Bank of Nova Scotia v. Dean, Civil No. 2011-64

• Decision Date: 26 September 2014
• Docket Number: Civil No. 2011-64
• Parties: THE BANK OF NOVA SCOTIA, Plaintiff, v. ANDREA DEAN, "JOHN DOE" being the unknown heirs of JAMES J. DEAN holding interest in Parcel No. 6-6 Estate Contant, No. 2 Cruz Bay Quarter, St. John, U.S. Virgin Islands, TROPICAL BREEZE DEVELOPMENT, LLC and WILLIAMS CONSTRUCTION COMPANY, Defendants.
• Court: U.S. District Court — Virgin Islands

THE BANK OF NOVA SCOTIA, Plaintiff, v. ANDREA DEAN, "JOHN DOE" being the unknown heirs ofJAMES J. DEAN holding interest in Parcel No. 6-6 Estate Contant,No. 2 Cruz Bay Quarter, St. John, U.S. Virgin Islands,TROPICAL BREEZE DEVELOPMENT, LLCand WILLIAMS CONSTRUCTION COMPANY, Defendants.

Civil No. 2011-64

DISTRICT COURT OF THE VIRGIN ISLANDS DIVISION OF ST. THOMAS AND ST. JOHN

September 26, 2014

MEMORANDUM OPINION AND ORDER

Before the Court is plaintiff's Emergency Motion for the Appointment of a Receiver [DE 89] for the real property described as Parcel No. 6-6 Estate Contant, No. 2 Cruz Bay Quarter, St. John, U.S. Virgin Islands as shown on PWD No. B9-451-T75 ("the Property"). Plaintiff seeks the appointment of a receiver based on the provision in the First Priority Mortgage Assignment of Leases and Rents and Construction Security Interest (the "First Priority Mortgage") that provides for the appointment of a receiver in the event of default and a subsequent foreclosure action. Pl.'s Mot., Ex. 1, Sec. 16 [DE 89-1 at 6].

This diversity suit is a residential foreclosure action. Plaintiff advises that an incomplete structure is situated on the Property. Plaintiff maintains that because construction is unfinished, a "danger of waste" is a concern, specifically the "potential for vandalism, theft and exposure to the elements." Accordingly, plaintiff requests the appointment of a receiver to "preserve" the Property and "prevent further waste."

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"[T]he intended purpose of the receiver . . . is to preserve and maintain the [property] site during the pendency of [] litigation, to preserve the value of the security, and to ensure that the laws and regulations of the U.S. Virgin Islands are fully complied with." First Am. Dev. Group/Carib, LLC v. WestLB AG, 53 V.I. 107, 130 (Super. Ct. 2010). The appointment of a receiver is considered "an equitable remedy of rather drastic nature available at the discretion of the Court." Mortg. Elec. Registration Sys., Inc. v. Patock, 51 V.I. 917, 928 (D.V.I. 2009) (quoting Nat'l Investors Pension Ins. Co., 1984 U.S. Dist. LEXIS 24701, at *5 (D.V.I. 1984)). The following factors guide the Court in its exercise of discretion: "(1) whether the security is adequate to cover the debt, (2) whether the mortgagor is insolvent, (3) whether there exists in the mortgage instrument a pledge of rent[s] and profits to the mortgagee, (4) whether waste has been committed, or (5) whether the security is endangered by nonpayment of taxes." Nat'l Investors Pension Ins. Co., 1984 U.S. Dist. LEXIS 24701,...