ELR Citation: ELR 20762
No(s). 91 Civ. 6685(MEL) (S.D.N.Y. Dec 16, 1991)

The court holds that the Resolution Trust Corp. (RTC) is entitled to a preliminary injunction requiring the owners and tenants of New York City properties to enter the properties to conduct environmental assessment studies in connection with mortgage foreclosures on the properties. The RTC seeks to conduct Phase II environmental assessment field studies on the properties to determine potential liability under the Comprehensive Environmental Response, Compensation, and Liability Act. The court first holds that the defendants have been properly served, because the RTC served copies of the summons and complaint at the individual defendants' usual places of abode, and the RTC served the New York Secretary of State as agent for service of process for the corporate defendants. The court next holds that the RTC has shown that it will suffer irreparable injury if the injunction is not granted. Not allowing the RTC to enter the property to perform environmental studies could force it to incur serious potential liability for environmental cleanup or else forego foreclosing on the property. The court holds that the RTC is likely to succeed on its claim that it is entitled to conduct the studies it proposes, because the mortgage instrument provides that the lender has an absolute right to the immediate possession of the mortgaged premises and may enter them. The court holds that the instrument authorizes reentry for the RTC tests. Finally, the court notes that according to expert witnesses on both sides, whatever burden the testing might cause is minimal.

Counsel for Plaintiff
Joseph J. Ortego, Michael E. Marsh
Rivkin, Radler, Bayh, Hart & Kremer
EAB Plaza, Uniondale NY 11556
(516) 357-3000

Counsel for Defendants
Morrell I. Berkowitz, Carl Kuntz, Kamran Moattar
Rudes, Lax, Berkowitz & Mittman
488 Madison Ave., New York NY 10022
(212) 308-6868