New Cherryland Twist May Plague Real Estate Deals Nationwide
Law360, New York (April 23, 2013, 9:34 PM EDT) -- Wells Fargo's high-profile loan default fight with Michigan's Cherryland Center mall took an unusual turn this month when a state appeals court backed a fast-tracked law designed in part to protect the Cherryland loan guarantor's assets, creating a bizarre precedent that attorneys say could complicate loan negotiations and jeopardize deals in other states.
The state law affirmed by the appeals court — Michigan's Nonrecourse Mortgage Loan Act — was passed quickly in the wake of the court's earlier finding that a guarantor was personally responsible for a defaulted loan on a Traverse City mall.
The law allows a lender to recover only...
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