The firm’s Banking, Business Financing & Creditors' Rights Practice Group plays a well-established role in New Jersey’s highly competitive commercial lending environment, serving as counsel to institutional clients in both routine and complex financing transactions. The group represents a number of New Jersey’s leading commercial lenders, providing responsive and efficient guidance at all stages of the lending process. We also serve as counsel to insurance companies, leasing companies, non-traditional lenders and financial institutions of all sizes.
Our team is highly proficient in all aspects of enforcement of creditors' rights and remedies, and the commercial litigation that financial institutions regularly encounter. We also serve as a valuable resource to business clients in their transactions with banks and other financing sources.
Our creditors' rights attorneys bring an experienced perspective and strong transactional knowledge to the enforcement of our clients' remedies, working pragmatically to assist in the negotiation of loan workouts and other out-of-court resolutions whenever possible. However, when necessary, we are aggressive and creative in our pursuit of remedies of foreclosure, repossession and litigation in federal, state and bankruptcy courts.
The firm’s attorneys have been involved in a number of leading cases in New Jersey pertaining to commercial paper and negotiable instruments. Our group has represented financial institutions in a wide range of cases involving fraudulent activities such as embezzlement, forgery, check kites and mortgage fraud. We also provide guidance on issues related to internal investigations and regulatory inquiries.
- Representation of a leading national lender in the negotiation, documentation and closing of a $17 million mortgage financing deal in 2013. The loan assisted a New Jersey manufacturer’s acquisition of its primary facility from a real estate investment trust. The transaction involved extensive negotiations with the borrower’s counsel over a six-month period. The firm’s services included the bank’s environmental review, material changes to the bank’s standard loan documentation, procuring consents from the manufacturer’s factoring lender, and the negotiation of an inter-company lease between the borrowing entity and the parent-manufacturer that occupies the facility.
- Representation of a commercial lender on the simultaneous closings of three mortgage loans in Maryland to finance the acquisition of three commercial properties by a New Jersey based company that is expanding its reach in the mid-Atlantic region. This transaction follows the group’s successful representation of this client in amending this borrower’s $40 million business line of credit.
- Representation of a New Jersey commercial lender in over $65 million in real estate financing transactions in 2013, including the $9 million construction/permanent mortgage refinancing of a self-storage facility in Jersey City.
- Representation of a regional commercial lender in its $23 million+ participation in an overall construction of approximately $67.5 million, secured by mortgage liens on a 120,000 sf shopping center and a multi-family rental apartment development. The transaction is one of series of participations the firm has handled for this bank.
Obtained a published opinion that clarified a long-standing issue under the New Jersey Prepayment Law and holds that prepayment fees are not prohibited on commercial loans where the collateral includes personal guarantees secured by mortgages on residential property. A guarantor of a commercial business loan, whose guarantee was secured by a mortgage on his residence, claimed that the prepayment fees charged by the lender violated the New Jersey Prepayment Law. In a unanimous decision, the Appellate Division concluded that the New Jersey Prepayment Law does not apply to a commercial loan to a corporate borrower. The decision clarified the distinction between mortgage loans to homeowners, to which the New Jersey Prepayment Law was intended to apply, and commercial loans to corporate borrowers, to which the Prepayment Law does not apply.
Successfully defended a financial institution in a case that resulted in the only published opinion under New Jersey’s elder financial abuse reporting statute. Following trial, the court dismissed the claims of an elderly depositor who had lost over $300,000 as a result of a scam. In its opinion, the court ruled that the New Jersey elder financial abuse reporting statute did not impose an affirmative duty to report cases of suspected abuse to law enforcement, but rather protects financial institutions from liability in the event they do make such reports.
Obtained the dismissal of a putative class action which challenged the order in which a bank paid checks presented for payment against customers’ accounts. The plaintiffs alleged the bank paid checks in an order designed to generate excessive overdraft and NSF fees. On our motion for summary judgment, the court ruled that under the bank’s deposit agreements and pursuant to the Uniform Commercial Code (UCC), the bank may charge checks against an account in any order within its “midnight deadline.”
Obtained a favorable jury verdict in a “lender liability” case, rejecting counterclaims and defenses alleging wrongful conduct on the part of a commercial lender in the administration of a business start-up and construction loan, and awarding the lender the full amount owed by the borrower and all guarantors.
Representation of commercial banks in numerous cases involving financial fraud. Examples include the successful defense of a claim arising out of a check embezzlement and fraudulent funds transfer scheme engineered by the controller of a multiple company conglomerate involving several million dollars; the dismissal, on motion for summary judgment, of a $1 million claim against our client bank by a large car dealership alleging a fraudulent check scheme perpetrated by its controller; the dismissal, on motion, of a $6 million claim arising out of a padded payroll and fraudulent check and funds transfer scheme involving a health care and rehabilitation facility.
Successfully represented a client bank in claims arising out of the distribution of IRA proceeds. After a favorable jury verdict and trial court rulings rejecting all but one of the claims, the firm successfully appealed and obtained a reversal of the remaining claim.
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