DWS Holdings, Inc. v. Hyde Park Associates

Prologue

In seeking the top development dollar for its land, appellant, DWS Holdings, Inc., (DES) was compelled to risk losing 10% of its selling price by taking back a note, secured by a deed of trust, for that portion of the price. Because land purchased for development presupposes substantial construction financing, appellant agreed to subordinate its deed of trust lien to the lien of “any Deed of Trust securing a bona fide construction loan. . . .” Anticipating that contingency, appellant sought to minimize its risk by obtaining personal sureties if such a construction loan subordination…