25548.5
. The exemptions set forth in Sections 25548.2 and 25548.3
shall not apply:
(a) If, after foreclosure or its equivalent is conducted, the
lender does not undertake to sell, re-lease property held pursuant to
a finance lease, whether by a new finance lease or by substitution
of the lessee, or otherwise undertake to be divested of the property
in a reasonably expeditious manner, using whatever commercially
reasonable means are relevant or appropriate with respect to the
property, taking all facts and circumstances into consideration. For
purposes of establishing that a lender is seeking to sell, re-lease
property held pursuant to a finance lease, whether by a new finance
lease or substitution of the lessee, or be divested of property in a
reasonably expeditious manner, the lender may use whatever
commercially reasonable means as are relevant or appropriate with
respect to the property, or may employ the following means:
(1) For purposes of this subdivision, the exemption set forth in
subdivision (a) of Section 25548.2 shall apply following foreclosure
or its equivalent, if, within 12 months following foreclosure or its
equivalent, the lender does either of the following:
(A) Lists the property for sale, re-lease, or other disposition
with a broker, dealer, or agent who deals with that type of property.
(B) Advertises the property for sale, re-lease, or other
disposition on at least a monthly basis in either of the following:
(i) A real estate publication or trade or other publication
suitable for advertising the property.
(ii) A newspaper of general circulation, which is a newspaper with
a circulation over 10,000 or one suitable under any applicable
federal, state, or local rules of court for publication required by
court order or rules of civil procedure, covering the area where the
property is located.
(2) For purposes of this subdivision, the 12-month period shall
begin to run from the date that the lender acquires marketable title
to the property if the lender, after the expiration of any redemption
or other waiting period provided by law, has acted diligently to
acquire marketable title. If the lender has failed to act diligently
to acquire marketable title, the 12-month period shall begin to run
on the date of foreclosure or its equivalent.
(b) If, after foreclosure or its equivalent, the lender does not
comply with all applicable statutes, regulations, or ordinances that
require the disclosure of information or conditions regarding the
property to any person.
(c) If the fiduciary's negligent or intentional or reckless
conduct causes or contributes to the release or threatened release of
a hazardous material at, from, or in connection with a property held
by the fiduciary as part of the fiduciary estate.
(d) With respect to liability that arises from a voluntary removal
or remedial action taken by a fiduciary if, prior to initiating a
voluntary removal or remedial action, the fiduciary does not notify
the appropriate agency of the fiduciary's intent to conduct that
action.
(e) With respect to liability that arises from conduct of, or
ownership of the property by, the lender or fiduciary, other than in
its capacity as a lender or fiduciary.
(f) Where the loan or obligation or fiduciary relationship or
fiduciary transaction is structured for the purpose of evading
liability for a release or threatened release of hazardous materials.
(g) If the fiduciary is both a beneficiary and fiduciary with
respect to the same fiduciary estate, or as a fiduciary, receives
benefits that exceed customary or reasonable compensation for the
administration of the property permitted under other applicable law.
(h) To the extent of the actual benefit, if any, realized by a
lender upon the disposition of property acquired through foreclosure
or its equivalent as a result of a removal or remedial action
undertaken by another person.
(i) If the lender participated in the management of the property
before foreclosure or its equivalent, except that the lender's
liability shall be limited to any release or threatened release which
occurred while the lender participated in the management of the
property.
(j) If the lender, by an act or failure to act caused or
contributed to the release or threatened release of the hazardous
material.
(k) If the lender made, secured, held, or acquired the loan or
obligation primarily for investment purposes.
(l) If the lender outbids, rejects, or fails to act upon an offer
of fair consideration for the property acquired through foreclosure
or its equivalent, unless the lender is required, to avoid liability
under federal or state law, to make a higher bid, to obtain a higher
offer, or to seek or obtain an offer in a different manner. For
purposes of this subdivision, the following terms shall have the
following meaning:
(1) (A) "Fair consideration" means the sum of all of the following
less the amounts specified in subparagraph (B):
(i) The value of the security interest or loan or obligation
calculated as an amount equal to or in excess of, the sum of the
outstanding principal, or comparable amount in the case of a finance
lease, owed to the lender immediately preceding the acquisition of
full title pursuant to foreclosure or its equivalent.
(ii) Any unpaid interest, rent, or penalties, whether arising
before or after foreclosure or its equivalent.
(iii) All reasonable and necessary costs, fees, or other charges
incurred by the lender incident to workout, foreclosure or its
equivalent, retention, maintaining the business activities of the
enterprise, preserving, protecting, and preparing the property prior
to sale, re-leasing the property held pursuant to a finance lease,
whether by a new finance lease or substitution of the lessee, or
other disposition.
(iv) The lender's costs incurred for any removal or remedial
action, including but not limited to, response costs for response
action taken by the lender under Section 107(d)(1) of the
Comprehensive Environmental Response Compensation and Liability Act
of 1980 (42 U.S.C. Sec. 9607(d)(1)).
(B) In determining fair consideration, the following amounts shall
be subtracted from the sum calculated pursuant to subparagraph (A):
(i) Any amounts received by the lender in connection with any
partial disposition of the property.
(ii) Net revenues received as a result of maintaining the business
activities of the enterprise.
(iii) Any amounts paid by the borrower subsequent to the
acquisition of full title pursuant to foreclosure or its equivalent.
(C) In the case of a lender holding a junior security interest,
junior loan, or junior obligation, "fair consideration" is the value
of all outstanding higher priority security interests, loans or
obligations plus the value of the security interest, loan or
obligation held by the junior holder, calculated as set forth in this
paragraph.
(2) "Outbids, rejects, or fails to act upon an offer of fair
consideration" means that the lender outbids, rejects, or fails to
act upon within 90 days from the date of receipt of a written, bona
fide and firm offer of fair consideration for the property received
at any time after six months following foreclosure or its equivalent.
That six-month period shall begin to run from the date that the
lender acquires marketable title, if the lender, after the expiration
of any redemption or other waiting period provided by law, has acted
diligently to acquire marketable title. If the lender has failed to
act diligently to acquire marketable title, the six-month period
shall begin to run on the date of foreclosure or its equivalent.
(3) "Written, bona fide and firm offer" means a legally
enforceable, commercially reasonable, cash offer solely for the
property, including all material terms of the transaction, from a
ready, willing, and able purchaser who demonstrates to the lender's
satisfaction the ability to perform.