The firm represented two clients, Brewer Crane & Rigging Company and Division 8, Inc. with claims for payment on a private 14 unit luxury condominium project in San Diego, California. Despite an insolvent developer, the firm recovered judgment against a private-money lender on bonded stop notices claims for the principal amount of nearly $275,000.00, as well as pre-judgment interest, bond premiums, attorneys’ fees and costs.
[expand title=”Read More” swaptitle=”Less”]The case concerned a $13.5 million construction loan which the defendant lender ceased funding as the project property value fell to less than that amount, and claimed it was not a construction lender for purposes of stop notice claims. Ultimately the owner went through bankruptcy and a senior lender foreclosed, thereby preventing either our clients or the defendant lender from recovering anything through their liens against the real property. The firm successfully argued that all of the construction loan funds not used to pay construction costs, including points, interest, fees, etc., whether paid to the defendant lender, paid to its participating investor/lenders, or as reimbursement for transaction costs, had to be disgorged for the benefit of the bonded stop notice claimants.
San Diego Superior Court Case No. 37-2007-00074230
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Counsel: Jeffrey B. Baird and Jon F. Gauthier