Lender Liability

Bank Enters Into Settlement With EPA For Contaminated NY Site

EPA entered into a settlement agreement with the Bank of India (Bank) as part of an innovative settlement to facilitate the sale and reuse of an abandoned facility in Cortland, NY. The settlement was published in the todays’s Federal Register .The proposed settlement is subject to a 30-day comment period. The settlement involves the Buckbee-Mears …

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Banks Growing Concerned Over Liability Concerns in Brazil

Brazil has a robust economy but some foreign lenders are growing concerned about participating in this expanding market because of potential liability for environmental issues associated with projects they finance. This anxiety follows a 2009 decision by the Superior Court of Justice,Brazil’s highest federal court of appeals, that suggested a lender could be liable for …

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Foreclosing Lender RCRA Action May Proceed

A federal district court  declined to dismiss a RCRA 7002 action brought by a foreclosing lender against the owner of an adjacent dry cleaner in Forest Park National Bank & Trust  v Ditchfield,  2012 U.S. Dist. LEXIS 103007(N.D. Ill. 7/24/12).  The court also granted summary judgment on the bank’s CERCLA cost recovery claim. One reason …

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Contamination at Heart of Litigation Over Failed Subdivisions

The Great Recession caused hundreds of residential development projects to ground to a halt. Not surprising, these failed projects have spawned lots of litigation. An interesting Maryland lawsuit involves allegations of fraud and misrepresentation of environmental issues at a development site, and has ensnarled a foreclosing lender. In U.S. Home v Settler’s Crossing, 2010 U.S. …

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Bank Not Liable for Failing To Disclose Environmental Issues At Foreclosure Sale

In Rhima v JPMorgan Chase Bank, 2012 U.S. Dist.LEXIS 70492 (N.D.Tx. 5/18/02), plaintiff was the successful bidder at a foreclosure auction for a warehouse property. The advertised terms and conditions of the foreclosure sale offer indicated that bidders would be provided with environmental reports and access to the property for inspection but the sale was …

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Bank Not Liable For Auction Sale of Contaminated Property

In Lusk v First Century Bank, 2012 W. Va. LEXIS 241 (Sup. Ct. 4/27/12), the plaintiff/petitioners purchased a commercial property at an auction foreclosure sale. The Notice of Trustee’s Sale and Regency’s advertising notice stated that the sale was subject to “environmental regulations” and that the property was being sold in an “as is” condition. …

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State Appeals Ct Affirms Note Purchaser Cannot Bring Nuisance Action For Contamination

It is no secret that distressed debt investors are eagerly looking for opportunities to purchase defaulted or underwater loans. One strategy used by investors with a healthy risk appetite is to purchase promissory notes secured by contaminated property at deeply discounted pricing. The investor then brings an RCRA 7002 action seeking an order requiring the …

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Acquisitions Bring CERCLA Liability to Banking Conglomerate

From a purely legal standpoint, the recent ruling In Tennessee v. Roane Holdings Ltd., 2011 U.S. Dist. LEXIS 143703 (E.D.TN 12/14/11) was not unusual. The court ruled on a motion to dismiss that a party who had entered into an administrative order on consent could not bring a cost recovery action under CERCLA section 107 …

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Foreclosing Banks Increasingly Using Env Insurance For Sales Risks

As the nation slowly lifts itself out of the effects of the Great Recession, lenders are beginning to increase the pace of foreclosures on commercial properties. The volume of foreclosures is likely to significantly increase during the next few years as the loans that were orginated during the height of the credit bubble become due. With real …

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