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Bankruptcy | Case Law | Assignment Rents
ASSIGNMENT OF RENTS
In re Scottsdale Medical Pavilion. 52 F.3d 244 (9th Cir.1995), aff’d. 159 B.R. 295 (9th Cir.
B.A.P. 1993)
(Az. law) because creditor properly perfected security interest in rents, prepetition rents
constituted cash collateral
In re Days California Riverside Ltd. Partnership, 27 F.3d 374 (9th Cir.1994)
Postpetition hotel revenues, encumbered by a prepetition trust deed and security interest
are ‘proceeds, product, offspring, rents or profits’ under §552(b). A major premise of hotel
financing is the stream of revenues. Hotel room charges are held to be ‘rents’ for security
purposes and thus subject to the lender’s prepetition lien. However, the net revenues, after
allocation of expenses, derived form food and beverage service are not ‘rents.’ See also In re San
Francisco Drake Hotel Assocs., 131 B.R. 156 (Bankr. N.D. Cal. 1991), aff’d, 147 B.R. 538 (N.D.
Cal. 1992).