Mid City Bank v. Downey Land Ltd.
Nov
16
2006
Ruling
Lessor who allegedly misrepresented condition of health club purchased by debtor did not owe any duty to financing bank and its claim was not subject to equitable subordination.
Procedural posture
Plaintiff bank filed a motion for summary judgment in its action against defendant lessor, which sought equitable subordination of the lessor's claim against chapter 7 debtor pursuant to 11 U.S.C. § 510(c). The lessor also filed a motion for summary judgment, claiming that it could not have breached a duty which would have given rise to a cause of action for equitable subordination, and that it was not liable for fraud or misrepresentation.
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Court
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