FDIC Sues Akerman Senterfitt
Akerman Senterfitt and the chair of its banking practice William C. Arnhols have been hit with a $4.6 million malpractice lawsuit. The Federal Deposit Insurance Corp. filed the suit on behalf of defunct Peninsula Bank.
The Federal Deposit Insurance Corp. is suing the Akerman Senterfitt law firm and the Miami chair of its banking practice, alleging negligence by the firm over its handling of a real estate loan caused the failed Peninsula Bank to lose $4.6 million.
The lawsuit, filed June 14 in U.S. District Court in Tampa, names as defendants Akerman; Miami partner William C. Arnhols, who chairs the firm’s banking, lending and structured finance practice; and Drake Batchelder, former managing partner of the firm’s Fort Lauderdale office.
Ben Hill III, an attorney for Akerman with Hill Ward Henderson in Tampa, said, “We completely disagree with the FDIC position and believe Akerman acted properly in all respects.”
Batchelder is in St. Augustine and is no longer with the firm. He and Arnhols did not return calls seeking comment.
The complaint alleges Englewood-based Peninsula Bank retained Akerman in 2007 to represent the bank on a $7 million loan to North Bay Village Investment Trust LLC. The trust wanted the money to purchase a 1.4-acre parcel in North Bay Village to build condominiums. The Aqua Vista project at 1775 Kennedy Causeway has since been targeted for foreclosure by yet another bank.
Akerman represented the bank since 2000 on at least 150 other matters in collection, bankruptcy and regulatory matters, according to the suit.
In the North Bay Village matter, the bank provided the law firm and two lawyers with draft loan documents for their review, the complaint said. The transaction called for North Bay to pledge mortgages on the Aqua Vista property as collateral for the loan.
North Bay purchased the property in a foreclosure sale. On Oct. 3, 2007, the bank sent a copy of the executed assignment of judgment to Batchelder. However, the complaint said he never recorded the assignment of judgment.
North Bay obtained title to the property in April 2008 but failed to execute and deliver a mortgage to Peninsula. As a result, the bank had no security interest in the property, the suit alleges.
In February 2009, North Bay defaulted on the note when the property value was $4.6 million.
“Because defendants failed to record the assignment of judgment and failed to take any other steps to secure the bank’s interest in the property, Peninsula was unable to enforce its rights,” the lawsuit stated.
Rest from the Daily Business Review here…