News + updates + recent press
On July 1, 2020, Uniform Commercial Real Estate Receivership Act (UCRERA) became effective under Chapter 714 of the Florida Statutes. The UCRERA codifies existing Florida common law regarding commercial foreclosures as a remedy to stakeholders and provides much needed uniformity. This is huge for Commercial Foreclosures in Florida, specifically, Fla. Stat. 714. 06, cited below. Prior to the enactment of this statute, there was not a statute that addressed the process for commercial real estate disputes. Of interest, is the fact that the statute states that the Court may condition the appointment of a receiver without prior notice of a hearing, on the giving of security by the person seeking the appointment for the payment of damages, reasonable attorney fees, and costs incurred.
Relevant Statute Below:
Fla. Stat. 714.06. Appointment of receiver
(1) The court may appoint a receiver:
(a) Before judgment, to protect a party that demonstrates an apparent right, title, or interest in real property that is the subject of the action, if the property or its revenue-producing potential:
1. Is being subjected to or is in danger of waste, loss, substantial diminution in value, dissipation, or impairment; or
2. Has been or is about to be the subject of a voidable transaction;
(b) After judgment:
1. To carry the judgment into effect; or
2. To preserve nonexempt real property pending appeal or when an execution has been returned unsatisfied and the owner refuses to apply the property in satisfaction of the judgment;
(c) In an action in which a receiver for real property may be appointed on equitable grounds, subject to the requirements of paragraphs (a) and (b); or
(d) During the time allowed for redemption, to preserve real property sold in an execution or foreclosure sale and secure its rents to the person entitled to the rents.
(2) In connection with the foreclosure or other enforcement of a mortgage, the court shall consider the following facts and circumstances, together with any other relevant facts, in deciding whether to appoint a receiver for the mortgaged property:
(a) Appointment is necessary to protect the property from waste, loss, substantial diminution in value, transfer, dissipation, or impairment;
(b) The mortgagor agreed in a signed record to the appointment of a receiver on default;
(c) The owner agreed, after default and in a signed record, to appointment of a receiver;
(d) The property and any other collateral held by the mortgagee are not sufficient to satisfy the secured obligation;
(e) The owner fails to turn over to the mortgagee proceeds or rents the mortgagee was entitled to collect; or
(f) The holder of a subordinate lien obtains appointment of a receiver for the property.
(3) The court may condition the appointment of a receiver without prior notice or hearing under s. 714.03 on the giving of security by the person seeking the appointment for the payment of damages, reasonable attorney fees, and costs incurred or suffered by any person if the court later concludes that the appointment was not justified. If the court later concludes that the appointment was justified and the order of appointment of the receiver becomes final and no longer subject to appeal, the court shall release the bond or other security. When any order appointing a receiver or providing for injunctive relief is issued on the pleading of a municipality or the state, or any officer, agency, or political subdivision thereof, the court may require or dispense with a bond, with or without surety, and conditioned in the same manner, having due regard for public interest.
(4) A party adversely affected by an order appointing a receiver may move to dissolve or modify the order at any time. If a party moves to dissolve or modify the order, the motion must be heard within 5 days after the movant applies for a hearing on the motion or at such time as the court determines is reasonable and appropriate under the circumstances after the movant applies for a hearing on the motion. After notice and a hearing, the court may grant relief for cause shown.
PLG BLOG DISCLAIMER
The information contained on this blog shall not constitute legal advice or a legal opinion. The existence of or review and/or use of this blog or any information hereon does not and is not intended to create an attorney-client relationship. Further, no information on this blog should be construed as investment advice. Independent legal and financial advice should be sought before using any information obtained from this blog. It is important to note that the cases are subject to change with future court decisions or other changes in the law. For the most up-to-date information, please contact Padgett Law Group (“PLG”). PLG shall have no liability whatsoever to any user of this blog or any information contained hereon, for any claim(s) related in any way to the use of this blog. Users hereby release and hold harmless PLG of and from any and all liability for any claim(s), whether based in contract or in tort, including, but not limited to, claims for lost profits or consequential, exemplary, incidental, indirect, special, or punitive damages arising from or related to their use of the information contained on this blog or their inability to use this blog. This Blog is provided on an "as is" basis without warranties of any kind, either express or implied, including, but not limited to, warranties of title or implied warranties of merchantability or fitness for a particular purpose.