Secured creditor filed a NJ Lawsuit

[Daytona365]

I was recently served with a complaint. I purchased some commercial kitchen equipment about three years ago. In the meantime, the business closed and we left the commercial property and all the equipment behind at the location. 

The creditor has a perfected UCC security lien on all the equipment. The landlord doesn't want to release it.

I intend to answer the complaint, and file a third party complaint against the landlord. The UCC security lien is superior to any type of landlord lien in NJ.

Any advice or comments?

[WhoCares1000]

The creditor has filed a case as a replevin case so that they can get a writ of possession (or write of replevin depending on jurisdiction) for their equipment. I would, at a minimum, notify the former landlord of the case just so that they are not shocked when the sheriff shows up with the creditor and a moving company to forcibly take the equipment (note, this is also how banks can deal with auto repos). If you want to add the landlord as an additional defendant on the suit and they can both argue who has better right to the equipment than so be it.

Note that if the landlord has sold the equipment, the creditor will come after you for payment and you need to go after the landlord to get the amount they should the equipment, assuming you can win such a case.

I would suggest talking to an experienced New Jersey replevin lawyer to figure out the best course of action in this case.

[LaneBlane]

As soon as you closed the business and vacated the property you should have made the landlord aware there was a UCC lien on all the equipment.  This would have put them on notice if they considered selling or disposing of anything you abandoned.  When I worked in commercial real estate for a large, international company, we had a department that conducted lien searches for equipment left behind.  Smaller leasing and management offices may not do this.

As WhoCares1000 said, the creditor has every right to forcibly take the equipment.  If the landlord still has possession of it, the creditor will be going after them as a third party.

[Daytona365]

Thanks for your responses.

Would the landlord be also liable for conversion since they failed to surrender the UCC secured equipment?

 

[WhoCares1000]

Only if the landlord sold the equipment and only to you, not to the finance company. What would happen is that the finance company will go after you for the full amount of the loan and then you would have to sue the landlord for what the equipment brought, minus anything you owed to the landlord who you can be sure will have a claim against you.