Is a Master Lease to Operate Healthcare Facility Classified As ‘Residential’ or ‘Nonresidential’ In Bankruptcy?
January 01, 2025
One of the most significant calls on cash in a bankruptcy involves post-petition rent obligations due on leased facilities. Under the Bankruptcy Code, post-petition obligations with respect to leased “nonresidential real property” must be timely paid. While the code draws a distinction between residential and nonresidential real property, there is no explicit definition of “nonresidential,” thus creating difficult issues in certain health care cases.
What You Need to Know About PA’s Act 52
January 01, 2025
The Wholesale Real Estate Transaction Transparency and Protection Act, which requires real estate wholesalers to obtain licensing and grants additional protections to property owners in wholesale transactions, will take effect on Jan. 4, 2025.
Construing Separate Contractual Instruments As One
January 01, 2025
At times, disputes arise among parties in commercial transactions as to whether multiple contracts involving a common matter should be read as a single, integrated contract, or as separate and distinct agreements. This issue often surfaces where one or more such agreements contain arbitration clauses, but other related contracts do not.
Post-Petition Rent Obligations On ‘Residential’ Versus ‘Nonresidential’ Property
January 01, 2025
The lifeblood of any debtor operating in Chapter 11 is access to cash to maintain ongoing operations. This is particularly important in cases involving assisted living and skilled nursing facilities given the health, safety, and welfare concerns with respect to their residents. One of the most significant calls on cash involves post-petition rent obligations due on leased facilities.
No Guarantee NY's Guaranty Law Survives Constitutional Scrutiny
December 01, 2024
After nearly four years of litigation, the Second Circuit held recently that a small commercial landlord lacked standing to seek declaratory relief against the City of New York challenging the Guaranty Law under the Contracts Clause of the U.S. Constitution.
Landlord & Tenant Law
December 01, 2024
Tenant Who Stopped Paying Rent May Not Recover DamagesDoctrine of Emblements May Entitle Tenant to Collect Damages for Loss of CropsInsufficient Evidence to Support Use and Occupancy ClaimSuccessor Landlord Liable for Predecessor’s OverchargesGuaranty Law Did Not Protect Guarantor When Tenant Never Closed
Hospitality Performance Tests In the Real World
December 01, 2024
Hotel management agreements often contain language permitting a hotel owner to terminate if the hotel’s performance fails to meet certain financial metrics. This provision, colloquially referred to as the “performance test,” is touted as a form of protection for owners by providing a right to terminate (or to receive a “cure payment”) if the hotel underperforms. But the reality is performance tests are generally structured to make them difficult, if not impossible, to fail, leaving hotel owners without the financial protection they thought they bargained for — or worse.
