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- The Show Must Go On: Shuttered Venues Operators Grant Provides Lifeline for Live Music and Theater Venues
- More Help For Arizona’s Restaurant & Hospitality Industry On the Way
- Married Couple’s Acquisition of Title as Joint Tenants Does Not Rebut the Presumption of Community Property
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Guarantors Remain Liable for “Carve-out” Obligations, Despite Non-recourse Loan
By: Ben Reeves
Introduction
Believe it or not, guaranty contracts mean what they say. If a guarantor agrees to reimburse a lender for misappropriated security deposits, unpaid taxes, and the cost of enforcement, then – not surprisingly – courts will hold the guarantors liable for these expenses.
In Investors Warranty of America, Inc. v. Arrowhead Business Center, L.P., the guarantors signed a limited guaranty contract obligating them to pay up to $350,000 if the borrower defaulted on the $5,250,000 commercial loan secured by an office building in Peoria. In addition to this capped amount, the guarantors agreed to pay for certain “carve-out” expenses, including misappropriated security deposits, unpaid taxes, and costs of enforcement. … Read More »
Author:
Ben Reeves
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Tagged bad-boy guaranty, carve-out, investors warranty v. arrowhead, non-recourse, real estate litigation
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