Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates thereof (each a “Borrower-Related Party”) against the Trust, the Master Servicer and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related Mortgage Loan documents, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents (“Trust-Related Litigation”). In the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation. (b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a), the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such Trust-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e); and provided, however, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the Master Servicer. (c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) (to the extent the identity of the Directing Certificateholder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) Business Day period, then the Directing Certificateholder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Holders, the Special Servicer may take such action without waiting for the Directing Certificateholder’s response. (d) Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may be, responsibilities under this Agreement. (e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.32, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement. (f) Further, nothing in this section shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement. (g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C). (h) In the event both the Master Servicer and the Special Servicer or Trust are named in Trust-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. This Section 3.32 shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. Notwithstanding the foregoing, (i) in the event that any action, suit, litigation or proceeding names the Trustee in its individual capacity, or in the event that any judgment is rendered against the Trustee in its individual capacity, the Trustee, upon prior written notice to the Master Servicer or the Special Servicer, as the case may be, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documents, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, (A) initiate an action, suit, litigation or proceeding in the name of the Trustee, whether in such capacity or individually, (B) engage counsel to represent the Trustee, or (C) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent); and (iii) in the event that any court finds that the Trustee is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) shall be interpreted to preclude the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trust.
Appears in 8 contracts
Samples: Pooling and Servicing Agreement (Morgan Stanley Capital I Trust 2016-Bnk2), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2017-Gs7), Pooling and Servicing Agreement (UBS Commercial Mortgage Trust 2017-C1)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicerServicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such Trust-Related Litigationnamed), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the such Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly quarterly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to material decisions and resolutions material monetary settlements related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; . If and/or once the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan-Related Litigation as provided that in Section 3.33(a) above, the Master Servicer shall no longer have the right reporting obligation set forth above and the Special Servicer’s selection of counsel shall be subject to engage separate counsel relating to claims against the consent of the Master Servicer to the extent set forth in Section 3.32(e); and providedwhich consent shall not be unreasonably withheld, howeverdelayed or conditioned. Further, that if there are claims against the Master Servicer Servicer, the Trust and the Master Servicer has not determined that separate counsel is required for such claimsSpecial Servicer, such counsel each party at the request of the other shall be reasonably acceptable to the Master Servicerenter into a joint defense agreement in accordance with Section 3.33(h) below.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither of the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.32, the Master Servicer shall retain the right at all times to make determinations final decisions in the Master Servicer’s reasonable discretion, relating to claims against the Master ServicerServicer where a settlement by the Special Servicer does not meet the conditions set forth in subclauses (i) through (v) of the first sentence of clause (g) below, including but not limited to the right to engage separate counsel counsel, to make settlement decisions with respect to claims asserted against the Master Servicer and to appear in any proceeding on its own behalf behalf. The cost related to or incurred in the Master Servicer’s reasonable discretion, the cost of which connection with exercising such rights shall be subject to indemnification as and to the extent provided in this Agreement. For the sake of clarity, the Master Servicer’s rights do not include the right to settle any claims against the Master Servicer without the Special Servicer’s consent if such settlement would (i) contain any admission of liability or wrongdoing on the part of the Master Servicer, the Trust, the Special Servicer or any other party to this Agreement, (ii) provide for the payment of damages or any sums for which the Master Servicer will seek indemnification from the Trust or any party to this Agreement or (iii) prejudice or impair the defense or counterclaims of the Trust or any party to this Agreement with respect to such Loan-Related Litigation.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) may not direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with without the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer unless (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (Ai) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master ServicerServicer and the Master Servicer is fully released, (Bii) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (Ciii) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (Div) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (Ev) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (Ai), (Bii), (iii) and (Civ). With respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall (i) to the extent that the Master Servicer and the Special Servicer deem it appropriate, use reasonable efforts to enter into a joint defense agreement and (ii) cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. Section.
(i) This Section 3.32 shall not apply in and to the event extent that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, Midland Loan Services, a Division of PNC Bank, National Association is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination whether or not such replacement is effective or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 7 contracts
Samples: Pooling and Servicing Agreement (UBS Commercial Mortgage Trust 2017-C1), Pooling and Servicing Agreement (CD 2017-Cd4 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2017-P7)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (other than a Non-and Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, Combination) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the Trust, the Master Servicer and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party Party, under the related Mortgage Loan documentsor Loan Combination, as applicable, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such TrustLoan-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)subsection, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.33(e); and provided, howeverfurther, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel selected by the Special Servicer shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section 3.33 to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.33, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation), provided in either case that (A) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C); and provided, further, that, with respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.33.
(i) This Section 3.32 shall not apply in the event event, and to the extent, that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, Rialto Capital Advisors, LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination (whether or not such replacement is effective) or such related Mortgage Loan or Loan Combination is an Excluded Special Servicer Mortgage Loan in respect of Rialto Capital Advisors, LLC as Special Servicer, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 7 contracts
Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2017-P8), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2017-Gs6), Pooling and Servicing Agreement (CD 2017-Cd4 Mortgage Trust)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicerServicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such Trust-Related Litigationnamed), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the such Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly quarterly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to material decisions and resolutions material monetary settlements related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; . If and/or once the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan-Related Litigation as provided that in Section 3.33(a) above, the Master Servicer shall no longer have the right reporting obligation set forth above and the Special Servicer's selection of counsel shall be subject to engage separate counsel relating to claims against the consent of the Master Servicer to the extent set forth in Section 3.32(e); and providedwhich consent shall not be unreasonably withheld, howeverdelayed or conditioned. Further, that if there are claims against the Master Servicer Servicer, the Trust and the Master Servicer has not determined that separate counsel is required for such claimsSpecial Servicer, such counsel each party at the request of the other shall be reasonably acceptable to the Master Servicerenter into a joint defense agreement in accordance with Section 3.33(h) below.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and the Uncertificated Interest Owners and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither of the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder Certificateholder, any Uncertificated Interest Owner or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.32, the Master Servicer shall retain the right at all times to make determinations final decisions in the Master Servicer's reasonable discretion, relating to claims against the Master ServicerServicer where a settlement by the Special Servicer does not meet the conditions set forth in subclauses (i) through (v) of the first sentence of clause (g) below, including but not limited to the right to engage separate counsel counsel, to make settlement decisions with respect to claims asserted against the Master Servicer and to appear in any proceeding on its own behalf behalf. The cost related to or incurred in the Master Servicer’s reasonable discretion, the cost of which connection with exercising such rights shall be subject to indemnification as and to the extent provided in this Agreement. For the sake of clarity, the Master Servicer’s rights do not include the right to settle any claims against the Master Servicer without the Special Servicer’s consent if such settlement would (i) contain any admission of liability or wrongdoing on the part of the Master Servicer, the Trust, the Special Servicer or any other party to this Agreement, (ii) provide for the payment of damages or any sums for which the Master Servicer will seek indemnification from the Trust or any party to this Agreement or (iii) prejudice or impair the defense or counterclaims of the Trust or any party to this Agreement with respect to such Loan-Related Litigation.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) may not direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with without the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer unless (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (Ai) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master ServicerServicer and the Master Servicer is fully released, (Bii) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (Ciii) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (Div) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (Ev) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (Ai), (Bii), (iii) and (Civ). With respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall (i) to the extent that the Master Servicer and the Special Servicer deem it appropriate, use reasonable efforts to enter into a joint defense agreement and (ii) cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. Section.
(i) This Section 3.32 shall not apply in and to the event extent that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, CWCapital Asset Management LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination, whether or not such replacement is effective, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 6 contracts
Samples: Pooling and Servicing Agreement (BMO 2022-C3 Mortgage Trust), Pooling and Servicing Agreement (BMO 2022-C2 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2022-Gc48)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the Trust, the Master Servicer and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party Party, under the related Mortgage Loan documentsor Loan Combination, as applicable, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such TrustLoan-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)subsection, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.33(e); and provided, howeverfurther, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel selected by the Special Servicer shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and the Uncertificated VRR Interest Owner and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder Certificateholder, the Uncertificated VRR Interest Owner or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section 3.33 to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.33, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation), provided in either case that (A) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C); and provided, further, that, with respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.33.
(i) This Section 3.32 shall not apply in the event event, and to the extent, that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, CWCapital Asset Management LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination (whether or not such replacement is effective) or such related Mortgage Loan or Loan Combination is an Excluded Special Servicer Mortgage Loan in respect of CWCapital Asset Management LLC as Special Servicer, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 6 contracts
Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2020-Gsa2), Pooling and Servicing Agreement (Benchmark 2020-B21 Mortgage Trust), Pooling and Servicing Agreement (JPMDB Commercial Mortgage Securities Trust 2020-Cor7)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (other than a Non-and Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, Combination) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the Trust, the Master Servicer and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party Party, under the related Mortgage Loan documentsor Loan Combination, as applicable, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such TrustLoan-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)subsection, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.33(e); and provided, howeverfurther, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel selected by the Special Servicer shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section 3.33 to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.33, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation), provided in either case that (A) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C); and provided, further, that, with respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.33.
(i) This Section 3.32 shall not apply in the event event, and to the extent, that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, KeyBank National Association is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination (whether or not such replacement is effective) or such related Mortgage Loan or Loan Combination is an Excluded Special Servicer Mortgage Loan in respect of KeyBank National Association as Special Servicer, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 5 contracts
Samples: Pooling and Servicing Agreement (CD 2017-Cd6 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2017-C4), Pooling and Servicing Agreement (Morgan Stanley Bank of America Merrill Lynch Trust 2017-C34)
Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named), and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related Mortgage Loan documents, documents or with respect to a Mortgage Loan (other than a Non-Serviced Mortgage Loan) or Serviced Whole Loan, as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or such Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such TrustLoan-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as reasonably practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly quarterly (unless requested in writing from time to time on a more frequent basis) status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to material decisions and resolutions material monetary settlements related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; . If and/or once the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan-Related Litigation as provided that in Section 3.32(a) above, the Master Servicer shall no longer have the right reporting obligations set forth above and the Special Servicer’s selection of counsel shall be subject to engage separate counsel relating to claims against the consent of the Master Servicer to the extent set forth in Section 3.32(e); and providedwhich consent shall not be unreasonably withheld. Further, however, that if there are claims against the Master Servicer Servicer, the Trust, and the Master Servicer has not determined that separate counsel is required for such claimsSpecial Servicer, such counsel each party at the request of the other shall be reasonably acceptable to the Master Servicerenter into a joint defense agreement in accordance with Section 3.32(h) below.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Loan for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related a Serviced Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Representative (for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding the foregoingSection 3.32(c) above, neither of the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.32, the Master Servicer shall retain the right at all times to make determinations in the Master Servicer’s sole discretion, relating to material and direct claims against the Master ServicerServicer where a settlement by the Special Servicer has not otherwise been resolved pursuant to the terms of clause (g) below, including but not limited to the right to engage separate counsel counsel, to make settlement decisions and to appear in any proceeding on its own behalf behalf. The cost related to or incurred in the Master Servicer’s reasonable discretion, the cost of which connection with exercising such rights shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section Section 3.32 shall require the Master Servicer, the Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Provisions, Grantor Trust Provisions, subject the Master Servicer, the Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, the Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding In the event where the Master Servicer’s right to make determinations relating to claims against the Master Servicer, Servicer or Special Servicer is a named party neither the Special Servicer shall have nor the right at Master Servicer will settle on behalf of the other such party, any time in accordance with the Servicing Standard to Loan-Related Litigation without such other party’s consent unless: (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (A) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master Servicersuch other party and such other party is fully released, (Bii) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this Agreement, (Ciii) the Master Servicer such other party is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any judgment, (Div) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (Ev) the Special Servicer provides the Master Servicer or the Special Servicer, as applicable, provides such other party with assurance reasonably satisfactory to the Master Servicer such other party, as to the items in clauses (Ai), (Bii), (iii) and (Civ).
(h) In the event both the Master Servicer and the Special Servicer or the Trust are named in TrustLoan-Related Litigation, to the extent that the Master Servicer and the Special Servicer deem it appropriate, the Master Servicer and the Special Servicer shall (i) use reasonable efforts to enter into a joint defense agreement and (ii) otherwise cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. .
(i) This Section 3.32 shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement, (i) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator or Custodian, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator or Custodian, as applicable, in its individual capacity, the Trustee, Certificate Administrator or Custodian, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documents, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator or Custodian, as applicable, (A) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator or Custodian, as applicable, whether in such capacity or individually, (B) engage counsel to represent the Trustee, Certificate Administrator or Custodian, as applicable, (C) settle any claim giving rise to liability to the Trustee, Certificate Administrator or Custodian, as applicable, in its individual capacity, or (CD) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator or Custodian, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator or Custodian to grant such consent); and (iii) in the event that any court finds that the Trustee Trustee, Certificate Administrator or Custodian, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator or the Custodian, as applicable, shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator or Custodian, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related Litigation, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee Trust. Notwithstanding the foregoing or anything to the contrary in this Section 3.32, this Section 3.32 shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, Rialto Capital Advisors, LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Whole Loan or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Whole Loan whether or not such replacement is effective or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) to such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Whole Loan (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, or affiliate that is such a party or holds such interest, and in each case under clauses (i) and (ii) above, the applicable party listed above shall provide notice of such occurrence to the Master Servicer pursuant to the terms of this Agreement. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth in this Agreement.
Appears in 5 contracts
Samples: Pooling and Servicing Agreement (CSAIL 2016-C6 Commercial Mortgage Trust), Pooling and Servicing Agreement (Morgan Stanley Capital I Trust 2015-Ubs8), Pooling and Servicing Agreement (CSAIL 2015-C3 Commercial Mortgage Trust)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicerServicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such Trust-Related Litigationnamed), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the such Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly quarterly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to material decisions and resolutions material monetary settlements related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; . If and/or once the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan-Related Litigation as provided that in Section 3.33(a) above, the Master Servicer shall no longer have the right reporting obligation set forth above and the Special Servicer’s selection of counsel shall be subject to engage separate counsel relating to claims against the consent of the Master Servicer to the extent set forth in Section 3.32(e); and providedwhich consent shall not be unreasonably withheld, howeverdelayed or conditioned. Further, that if there are claims against the Master Servicer Servicer, the Trust and the Master Servicer has not determined that separate counsel is required for such claimsSpecial Servicer, such counsel each party at the request of the other shall be reasonably acceptable to the Master Servicerenter into a joint defense agreement in accordance with Section 3.33(h) below.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) Business Day period, then the Directing Certificateholder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Holders, the Special Servicer may take such action without waiting for the Directing Certificateholder’s response.
(d) Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify and for so long as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may be, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.32, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a no Control Termination Event or the occurrence has occurred and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in Trust-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. This Section 3.32 shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. Notwithstanding the foregoing, (i) in the event that any action, suit, litigation or proceeding names the Trustee in its individual capacity, or in the event that any judgment is rendered against the Trustee in its individual capacity, the Trustee, upon prior written notice to the Master Servicer or the Special Servicer, as the case may be, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documents, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, (A) initiate an action, suit, litigation or proceeding in the name of the Trustee, whether in such capacity or individually, (B) engage counsel to represent the Trustee, or (C) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent); and (iii) in the event that any court finds that the Trustee is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) shall be interpreted to preclude the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trust.is
Appears in 5 contracts
Samples: Pooling and Servicing Agreement (COMM 2019-Gc44 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2019-Gc43), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2019-Gc42)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicerServicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such Trust-Related Litigationnamed), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the such Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly quarterly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to material decisions and resolutions material monetary settlements related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; . If and/or once the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan-Related Litigation as provided that in Section 3.33(a) above, the Master Servicer shall no longer have the right reporting obligation set forth above and the Special Servicer’s selection of counsel shall be subject to engage separate counsel relating to claims against the consent of the Master Servicer to the extent set forth in Section 3.32(e); and providedwhich consent shall not be unreasonably withheld, howeverdelayed or conditioned. Further, that if there are claims against the Master Servicer Servicer, the Trust and the Master Servicer has not determined that separate counsel is required for such claimsSpecial Servicer, such counsel each party at the request of the other shall be reasonably acceptable to the Master Servicerenter into a joint defense agreement in accordance with Section 3.33(h) below.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and the Uncertificated VRR Interest Owner and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither of the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder Certificateholder, the Uncertificated VRR Interest Owner or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any either Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.32, the Master Servicer shall retain the right at all times to make determinations final decisions in the Master Servicer’s reasonable discretion, relating to claims against the Master ServicerServicer where a settlement by the Special Servicer does not meet the conditions set forth in subclauses (i) through (v) of the first sentence of clause (g) below, including but not limited to the right to engage separate counsel counsel, to make settlement decisions with respect to claims asserted against the Master Servicer and to appear in any proceeding on its own behalf behalf. The cost related to or incurred in the Master Servicer’s reasonable discretion, the cost of which connection with exercising such rights shall be subject to indemnification as and to the extent provided in this Agreement. For the sake of clarity, the Master Servicer’s rights do not include the right to settle any claims against the Master Servicer without the Special Servicer’s consent if such settlement would (i) contain any admission of liability or wrongdoing on the part of the Master Servicer, the Trust, the Special Servicer or any other party to this Agreement, (ii) provide for the payment of damages or any sums for which the Master Servicer will seek indemnification from the Trust or any party to this Agreement or (iii) prejudice or impair the defense or counterclaims of the Trust or any party to this Agreement with respect to such Loan-Related Litigation.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) may not direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with without the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer unless (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (Ai) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master ServicerServicer and the Master Servicer is fully released, (Bii) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (Ciii) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (Div) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (Ev) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (Ai), (Bii), (iii) and (Civ). With respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall (i) to the extent that the Master Servicer and the Special Servicer deem it appropriate, use reasonable efforts to enter into a joint defense agreement and (ii) cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. Section.
(i) This Section 3.32 shall not apply in and to the event extent that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, Rialto Capital Advisors, LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination, whether or not such replacement is effective, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 4 contracts
Samples: Pooling and Servicing Agreement (GS Mortgage Securities Trust 2020-Gsa2), Pooling and Servicing Agreement (Benchmark 2020-B21 Mortgage Trust), Pooling and Servicing Agreement (Benchmark 2020-B20 Mortgage Trust)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicerServicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such Trust-Related Litigationnamed), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the such Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly quarterly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and any settlements or resolutions or material interim actions related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; . If and/or once the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan-Related Litigation as provided that in Section 3.33(a) above, the Master Servicer shall no longer have the right reporting obligation set forth above and the Special Servicer’s selection of counsel shall be subject to engage separate counsel relating to claims against the consent of the Master Servicer to the extent set forth in Section 3.32(e); and providedwhich consent shall not be unreasonably withheld, howeverdelayed or conditioned. Further, that if there are claims against the Master Servicer Servicer, the Trust and the Master Servicer has not determined that separate counsel is required for such claimsSpecial Servicer, such counsel each party at the request of the other shall be reasonably acceptable to the Master Servicerenter into a joint defense agreement in accordance with Section 3.33(h) below.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither of the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the such Special Servicer to direct the Master Servicer’s actions in accordance with this Section 3.32Section, the Master Servicer shall retain the right at all times to make determinations final decisions in the Master Servicer’s reasonable discretion, relating to claims against the Master ServicerServicer where a settlement by the Special Servicer does not meet the conditions set forth in subclauses (i) through (v) of the first sentence of clause (g) below, including but not limited to the right to engage separate counsel counsel, to make settlement decisions with respect to claims asserted against the Master Servicer and to appear in any proceeding on its own behalf behalf. The cost related to or incurred in the Master Servicer’s reasonable discretion, the cost of which connection with exercising such rights shall be subject to indemnification as and to the extent provided in this Agreement. For the sake of clarity, the Master Servicer’s rights do not include the right to settle any claims against the Master Servicer without the Special Servicer’s consent if such settlement would (i) contain any admission of liability or wrongdoing on the part of the Master Servicer, the Trust, the Special Servicer or any other party to this Agreement, (ii) provide for the payment of damages or any sums for which the Master Servicer will seek indemnification from the Trust or any party to this Agreement or (iii) prejudice or impair the defense or counterclaims of the Trust or any party to this Agreement with respect to such Loan-Related Litigation.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) may not direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with without the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer unless (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (Ai) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master ServicerServicer and the Master Servicer is fully released, (Bii) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (Ciii) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (Div) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (Ev) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (Ai), (Bii) and (Ciii). With respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall (i) use reasonable efforts to enter into a joint defense agreement and (ii) cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. Section.
(i) This Section 3.32 shall not apply in and to the event extent that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documents, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust. Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, C-III Asset Management LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination whether or not such replacement is effective or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 4 contracts
Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2016-P5), Pooling and Servicing Agreement (JPMCC Commercial Mortgage Securities Trust 2016-Jp3), Pooling and Servicing Agreement (Wells Fargo Commercial Mortgage Trust 2016-Lc24)
Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-an Outside Serviced Mortgage Loan or any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named), and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“Trust-Related Litigation”). In the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as reasonably practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)3.33(a) above, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, Servicer regarding such Trust-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the such lawsuit, consult with with, and act at the take direction of from, the Special Servicer with respect to material decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel. If and/or when the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Trust-Related Litigation as provided in Section 3.33(a) above; provided provided, that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.33(e); and provided, howeverfurther, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel selected by the Special Servicer shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until (A) it has notified in writing the applicable Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) Holder (to the extent the identity of the Directing Certificateholder Holder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing CertificateholderHolder) and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), ) and (B) the applicable Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the applicable Directing Certificateholder Holder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the applicable Directing Certificateholder Holder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a and any related Serviced Whole Loan, the related Companion HoldersLoan holders, the Special Servicer may take such action without waiting for the applicable Directing CertificateholderHolder’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the applicable Directing Certificateholder or the Risk Retention Consultation Party Holder (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided under this Section 3.33 to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.33, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section Section 3.33 shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith reasonable judgment and reasonable judgmentin accordance with the Servicing Standard, may (i) cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions, (ii) cause the Master Servicer to violate the Servicing Standard, (iii) result in a violation of applicable law or the REMIC Provisions related Loan Documents or (iiiv) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlementssettlements with respect to any Mortgage Loan, with the consent or consultation of or in consultation with the applicable Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) Holder and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), ; provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(h) In the event both the Master Servicer and the Special Servicer or the Trust are named in Trust-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.33.
(i) This Section 3.32 3.33 shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney (i) in the event that any action, suit, litigation or proceeding names the Trustee Certificate Administrator, the Trustee, the Custodian or the Operating Advisor or the Asset Representations Reviewer, as applicable, in its individual capacity, or in the event that any judgment is rendered against the Trustee Certificate Administrator, the Trustee, the Custodian or the Operating Advisor or the Asset Representations Reviewer, as applicable, in its individual capacity, the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, (A) initiate an action, suit, litigation or proceeding in the name of the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, whether in such capacity or individually, (B) engage counsel to represent the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, (C) settle any claim giving rise to liability to the Trustee, the Certificate Administrator, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, in its individual capacity, or (CD) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions action with the intent to cause, and that actually causes, the Trustee Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, to grant such consent); and (iii) in the event that any court finds that the Trustee Certificate Administrator, the Trustee, the Custodian or the Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the applicable Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, Holder to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party3.33(c)) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trust. References to Mortgage Loans (including references to Mortgagors, guarantors, obligors and Mortgaged Properties) in this Section 3.33 shall mean Mortgage Loans other than Outside Serviced Mortgage Loans.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Trust-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Trust-Related Litigation is commenced or at any time during the continuance of such Trust-Related Litigation, LNR Partners, LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination (whether or not such replacement is effective) or such related Mortgage Loan or Loan Combination is an Excluded Special Servicer Mortgage Loan in respect of LNR Partners, LLC as Special Servicer, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Trust-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Trust-Related Litigation relates, unless otherwise agreed to in writing by each of the Depositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Trust-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 4 contracts
Samples: Pooling and Servicing Agreement (Bank 2020-Bnk26), Pooling and Servicing Agreement (Benchmark 2020-B16 Mortgage Trust), Pooling and Servicing Agreement (Bank 2019-Bnk24)
Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-an Outside Serviced Mortgage Loan or any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named), and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“Trust-Related Litigation”). In the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as reasonably practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)3.33(a) above, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, Servicer regarding such Trust-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the such lawsuit, consult with with, and act at the take direction of from, the Special Servicer with respect to material decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel. If and/or when the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Trust-Related Litigation as provided in Section 3.33(a) above; provided provided, that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.33(e); and provided, howeverfurther, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel selected by the Special Servicer shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until (A) it has notified in writing the applicable Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) Holder (to the extent the identity of the Directing Certificateholder Holder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing CertificateholderHolder) and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), ) and (B) the applicable Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the applicable Directing Certificateholder Holder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the applicable Directing Certificateholder Holder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a and any related Serviced Whole Loan, the related Companion HoldersLoan holders, the Special Servicer may take such action without waiting for the applicable Directing CertificateholderHolder’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the applicable Directing Certificateholder or the Risk Retention Consultation Party Holder (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided under this Section 3.33 to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.33, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section Section 3.33 shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith reasonable judgment and reasonable judgmentin accordance with the Servicing Standard, may (i) cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions, (ii) cause the Master Servicer to violate the Servicing Standard, (iii) result in a violation of applicable law or the REMIC Provisions related Loan Documents or (iiiv) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlementssettlements with respect to any Mortgage Loan, with the consent or consultation of or in consultation with the applicable Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) Holder and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), ; provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(h) In the event both the Master Servicer and the Special Servicer or the Trust are named in Trust-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.33.
(i) This Section 3.32 3.33 shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney (i) in the event that any action, suit, litigation or proceeding names the Trustee Certificate Administrator, the Trustee, the Custodian or the Operating Advisor or the Asset Representations Reviewer, as applicable, in its individual capacity, or in the event that any judgment is rendered against the Trustee Certificate Administrator, the Trustee, the Custodian or the Operating Advisor or the Asset Representations Reviewer, as applicable, in its individual capacity, the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, (A) initiate an action, suit, litigation or proceeding in the name of the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or or the Asset Representations Reviewer, as applicable, whether in such capacity or individually, (B) engage counsel to represent the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, (C) settle any claim giving rise to liability to the Trustee, the Certificate Administrator, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, in its individual capacity, or (CD) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions action with the intent to cause, and that actually causes, the Trustee Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, to grant such consent); and (iii) in the event that any court finds that the Trustee Certificate Administrator, the Trustee, the Custodian or the Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee the Certificate Administrator, the Trustee, the Custodian, the Operating Advisor or the Asset Representations Reviewer, as applicable, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the applicable Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, Holder to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party3.33(c)) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trust. References to Mortgage Loans (including references to Mortgagors, guarantors, obligors and Mortgaged Properties) in this Section 3.33 shall mean Mortgage Loans other than Outside Serviced Mortgage Loans.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Trust-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Trust-Related Litigation is commenced or at any time during the continuance of such Trust-Related Litigation, LNR Partners, LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination (whether or not such replacement is effective) or such related Mortgage Loan or Loan Combination is an Excluded Special Servicer Mortgage Loan in respect of LNR Partners, LLC as Special Servicer, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Trust-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Trust-Related Litigation relates, unless otherwise agreed to in writing by each of the Depositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Trust-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 4 contracts
Samples: Pooling and Servicing Agreement (UBS Commercial Mortgage Trust 2019-C18), Pooling and Servicing Agreement (CF 2019-Cf3 Mortgage Trust), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2019-C7)
Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the The Special Servicer shall, shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates thereof (each a “Borrower-Related Party”) Mortgagor against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the TrustMortgagor, or of the Mortgagor guarantor or other Borrower-Related Party obligor under the related Mortgage Loan documents, documents or with respect to the related Mortgaged Property Trust or other collateral securing such Mortgage Loan (or Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party Mortgagor, guarantor or other obligor under the related Mortgage Loan documents (“Trust-Related Litigation”). In the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(aclause (a), the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such Trust-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel; provided provided, that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e9.34(e); and provided, howeverfurther, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a during any Subordinate Control Period or Collective Consultation Termination Event) (to the extent the identity of the Directing Certificateholder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing CertificateholderPeriod) and the related holder of any related Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), ) and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Representative (during any Subordinate Control Termination EventPeriod) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided provided, that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Loan Pair, any related Serviced Whole Loan, the related Companion HoldersLoan holder, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Pair, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause result in an Adverse REMIC Event with respect to any REMIC created hereunder Pool or an Adverse Grantor Trust Event with respect to fail to qualify as a REMICthe Grantor Trust, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.329.34, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent or consultation of the Controlling Class Representative during a Subordinate Control Period or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Collective Consultation Termination EventPeriod, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)respectively) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation); provided, provided that in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and under circumstances in which payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, and (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C). Any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in Trust-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 9.34.
(i) This Section 3.32 9.34 shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, (iA) in the event that any action, suit, litigation or proceeding names the Trustee in its individual capacity, or in the event that any judgment is rendered against the Trustee in its individual capacity, the Trustee, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiB) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding directly relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise directly relating to one or more Mortgage Loans or Mortgaged PropertiesProperties pursuant to the power of attorney granted to the Special Servicer or the Master Servicer, as applicable, under this Agreement, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, or (Ciii) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent); and (iiiC) in the event that any court finds that the Trustee is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of Controlling Class Representative during a Subordinate Control Termination Event Period or the occurrence and continuance of a Collective Consultation Termination EventPeriod, respectively, to the extent required in Section 3.32(c9.34(c) and only subject to the extent such Mortgage Loan is not an Excluded Loan as to such partySection 9.34(d)) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trust.
Appears in 3 contracts
Samples: Pooling and Servicing Agreement (Morgan Stanley Bank of America Merrill Lynch Trust 2014-C16), Pooling and Servicing Agreement (Morgan Stanley Bank of America Merrill Lynch Trust 2014-C14), Pooling and Servicing Agreement (Morgan Stanley Bank of America Merrill Lynch Trust 2014-C16)
Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the The General Special Servicer shall, in accordance with the Servicing Standard, (1) direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or Mortgagor (other obligor on the related Note or any Affiliates thereof (each than a “BorrowerMortgagor with respect to a Co-Related Party”op Mortgage Loan) against the Trust, the Master Servicer Trust and/or the General Special Servicer or any predecessor master servicer or special servicer, and (2) represent the interests of the Trust in any litigation relating to the rights and obligations of such Mortgagor or the Trust, or of the Mortgagor or other Borrower-Related Party under the related Mortgage Loan documents, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party such Mortgagor, under the related Mortgage Loan documents (“"General Trust-Related Litigation”"). In The Co-op Special Servicer shall, (1) direct, manage, prosecute and/or defend any action brought by a Mortgagor with respect to the event that Co-op Mortgage Loans against the Trust and/or the Co-op Special Servicer and (2) represent the interests of the Trust in any litigation relating to the rights and obligations of such Mortgagor or the Trust, or the enforcement of the obligations of such Mortgagor under the related Mortgage Loan documents ("Co-op Trust-Related Litigation" and, collectively with General Trust-Related Litigation, "Trust-Related Litigation"). To the extent either Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the applicable Special Servicer is named, in order to effectuate the role of the applicable Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the applicable Master Servicer shall (i1) notify the General Special Servicer (with respect to General Trust-Related Litigation) or the Co-op Special Servicer (with respect to Co-op Trust-Related Litigation) of such Trust-Related Litigation within ten (10) days of such Master Servicer receiving service of such Trust-Related Litigation; (2) provide monthly status reports to the applicable Special Servicer, Servicer regarding such Trust-Related Litigation; (ii3) seek to have the Trust replace the applicable Master Servicer as the appropriate party to the lawsuit; and (iii4) so long as the applicable Master Servicer remains a party to the lawsuit, consult with and act at the direction of the applicable Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e); and , provided, however, that if there are claims against the applicable Master Servicer and the such Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the applicable Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) (to the extent the identity of the Directing Certificateholder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) Business Day period, then the Directing Certificateholder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Holders, the Special Servicer may take such action without waiting for the Directing Certificateholder’s response.
(d) . Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may be, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicers otherwise set forth above and below, (i) the Special Servicer to direct shall provide the Master Servicer’s actions in this Section 3.32, the applicable Master Servicer with copies of any notices, process and/or pleadings submitted and/or filed in any such action, suit, litigation or proceeding; (ii) the applicable Master Servicer may retain its own counsel, whose reasonable costs shall retain be paid by the right to make determinations relating to claims against the Master ServicerTrust under Section 8.24, including but not limited to the right to engage separate counsel and to appear in any action, suit, litigation or proceeding on its own behalf in order to represent, protect and defend its interests; and (iii) the applicable Master Servicer shall have the right to approve or disapprove of any judgment, settlement, final order or decree that may impose liability on the applicable Master Servicer or otherwise materially and adversely affect the applicable Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and including, but not limited to, damage to the extent provided in this Agreement.
(f) applicable Master Servicer's reputation as a master servicer. Further, nothing in this section shall require the a Master Servicer to take or fail to take any action which, in the such Master Servicer’s 's good faith and reasonable judgment, may (i1) result in a violation of the an Adverse REMIC Provisions Event or Adverse Grantor Trust Event or (ii2) subject the such Master Servicer to liability or materially expand the scope of the such Master Servicer’s 's obligations under this Agreement.
(g) Notwithstanding . Subject to the rights of the Master Servicer’s right to make determinations relating to claims against the Master ServicerServicer set forth above and below, the General Special Servicer and the Co-op Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i1) direct the General Master Servicer and the NCB Master Servicer, respectively, to settle any claims Trust-Related Litigation brought against the Trust, including Trust-Related Litigation asserted against the General Master Servicer or the NCB Master Servicer, respectively (whether or not the Trust or the applicable Special Servicer is named in any such Trust-Related Litigation) and (2) otherwise reasonably direct the actions of the General Master Servicer and the NCB Master Servicer, respectively, relating to Trust-Related Litigation against such Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the applicable Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of such Master Servicer or otherwise materially and adversely affect the applicable Master Servicer, including, but not limited to, damage to the applicable Master Servicer's reputation as a master servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this AgreementTrust, (C) the such Master Servicer is and shall be indemnified as and pursuant to the extent provided in this Agreement Section 8.24 hereof for all costs and expenses of the such Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the such Master Servicer at the direction of the applicable Special Servicer shall be deemed (as to the such Master Servicer) to be in compliance with the Servicing Standard and (E) the such Special Servicer provides the applicable Master Servicer with assurance reasonably satisfactory to the such Master Servicer as to the items in clauses (A), (B) and (C).
(h) . In the event both more than one of the Master Servicer Servicers and the Special Servicer Servicers or Trust are named in Trust-Related Litigationlitigation, the applicable Master Servicer Servicers and the applicable Special Servicer Servicers shall cooperate with each other to afford the applicable Master Servicer Servicers and the applicable Special Servicer the rights afforded to such party in this Section 3.329.40. This Section 3.32 9.40 shall not apply in the event the General Special Servicer authorizes the General Master Servicer, or the Co-op Special Servicer authorizes the NCB Master Servicer, and the applicable Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing StandardTrust. Notwithstanding the foregoing, (ia) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, the Paying Agent and/or the Certificate Registrar in its individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, the Paying Agent and/or the Certificate Registrar in its individual capacity, the Trustee, the Paying Agent and/or the Certificate Registrar, upon prior written notice to the all applicable Master Servicer Servicers or the Special Servicer, as the case may beServicers, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not provided that the applicable Master Servicer or applicable Special Servicer shall retain the right to otherwise directmanage and direct any such action, manage or prosecute such suit, litigation or claimproceeding); (iib) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documents, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the General Master Servicer (with respect to the Mortgage Loans other than the NCB, FSB Loans) nor the General Special Servicer (with respect to the Mortgage Loans other than the Co-op Mortgage Loans) and neither the NCB Master Servicer (with respect to the NCB, FSB Loans) nor the Co-op Special Servicer (with respect to the Co-op Mortgage Loans) shall, without the prior written consent of the Trustee, the Paying Agent and/or the Certificate Registrar, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, the Paying Agent and/or the Certificate Registrar, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, the Paying Agent and/or the Certificate Registrar, or (Ciii) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions action with the intent to cause, and that actually causes, the Trustee Trustee, the Paying Agent and/or the Certificate Registrar to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent)state; and (iiic) in the event that any court finds that the Trustee Trustee, the Paying Agent and/or the Certificate Registrar is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Paying Agent and/or the Certificate Registrar shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, the Paying Agent and/or the Certificate Registrar or individually (but not to otherwise direct, manage provided that the applicable Master Servicer or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) shall be interpreted to preclude the applicable Special Servicer (with respect shall retain the right to manage and direct any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trustproceeding).
Appears in 3 contracts
Samples: Pooling and Servicing Agreement (Morgan Stanley Capital I Trust 2007-Iq13), Pooling and Servicing Agreement (Morgan Stanley Capital I Trust 2007-Iq13), Pooling and Servicing Agreement (Morgan Stanley Capital I Trust 2007-Iq13)
Litigation Control. (a) With The Special Servicer (with respect to any each Serviced Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named), and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Serviced Mortgage Loan documentsor Serviced Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Serviced Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such TrustLoan-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)subsection, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the such lawsuit, consult with and act at the direction of the Special Servicer with respect to material decisions and resolutions related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel. If and/or when the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan Related Litigation as provided in Section 3.33(a) above; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.33(e); and provided, howeverfurther, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel selected by the Special Servicer shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Serviced Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Serviced Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole LoanLoan Combination, the related Serviced Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party Controlling Class Representative (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section 3.33 to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.33, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) . Further, nothing in this section Section shall require the Master Servicer, the Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) cause any Trust REMIC to fail to qualify as a REMIC or the Grantor Trust to fail to qualify as a grantor trust for federal income tax purposes, result in the imposition of “prohibited transaction” or “prohibited contribution” tax under the Code, or otherwise result in a violation of the REMIC Provisions Provisions, (ii) cause the Master Servicer or the Special Servicer to violate the Servicing Standard, (iii) result in a violation of applicable law or the Loan documents or (iiiv) subject the Master Servicer, the Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, the Special Servicer or such party’s obligations under this Agreement.
(gf) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation), provided in either case that (A) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(hg) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.33.
(h) This Section 3.32 shall not apply in the event event, and to the extent, that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(i) Notwithstanding the foregoing, and subject to the power of attorney granted by the Trustee pursuant to the first sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Serviced Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust. Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, LNR Partners, LLC is no longer the Special Servicer with respect to the related Serviced Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Serviced Mortgage Loan or related Serviced Loan Combination (whether or not such replacement is effective) or such related Serviced Mortgage Loan or Serviced Loan Combination is an Excluded Special Servicer Mortgage Loan in respect of LNR Partners, LLC as Special Servicer, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Serviced Mortgage Loan or related Serviced Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 3 contracts
Samples: Pooling and Servicing Agreement (Benchmark 2019-B10 Mortgage Trust), Pooling and Servicing Agreement (GS Mortgage Securities Trust 2019-Gc38), Pooling and Servicing Agreement (Benchmark 2019-B9 Mortgage Trust)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (other than a Non-and Serviced Mortgage Whole Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named), and/or the Special Servicer or any predecessor master servicer or special servicerServicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Whole Loan, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such Trust-Related Litigationnamed), the Master Servicer shall notify the Controlling Class Representative (for so long as no Consultation Termination Event has occurred and is continuing) and the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e)herein; and provided, howeverfurther, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Loan for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Representative (for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding the foregoing, neither of the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in accordance with this Section 3.32Section, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section Section shall require the Master Servicer, the Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Provisions, Grantor Trust Provisions, subject the Master Servicer, the Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, the Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with the consent or consultation of or in consultation with the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each caserespectively), other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation), provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (C) Section 6.03 of this Agreement provides that the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, and (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. Section.
(i) This Section 3.32 shall not apply in and to the event extent that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documents, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related Litigation, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee Trust. Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, Rialto Capital Advisors, LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Whole Loan or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Whole Loan whether or not such replacement is effective or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) to such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Whole Loan (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 2 contracts
Samples: Pooling and Servicing Agreement (CSAIL 2015-C3 Commercial Mortgage Trust), Pooling and Servicing Agreement (CSAIL 2015-C2 Commercial Mortgage Trust)
Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the The Special Servicer shall, in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates thereof (each a “Borrower-Related Party”) Mortgagor against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor Mortgagor, guarantor or other Borrower-Related Party obligor, in each case under the related Mortgage Loan documents or Trust Companion Loan documents, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)as applicable, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party Mortgagor, guarantor or other obligor under the related Mortgage Loan documents or Trust Companion Loan documents (“Trust-Related Litigation”). In the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)subsection, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such Trust-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.35(e); and provided, however, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) (to the extent the identity of the Directing Certificateholder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), ) and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) -Business Day period, then the Directing Certificateholder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing Certificateholder’s response.
(d) Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan, Serviced Whole Loan or Serviced the U-Haul Self-Storage Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.35 below, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent or consultation of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)respectively) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in Trust-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.35.
(i) This Section 3.32 3.35 shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, (i) in the event that any action, suit, litigation or proceeding names the Trustee in its individual capacity, or in the event that any judgment is rendered against the Trustee in its individual capacity, the Trustee, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documents or Trust Companion Loan documents, or otherwise relating to one or more Mortgage Loans or the Trust Companion Loan or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, (A) initiate an action, suit, litigation or proceeding in the name of the Trustee, whether in such capacity or individually, (B) engage counsel to represent the Trustee, or (C) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent); and (iii) in the event that any court finds that the Trustee is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan or the Trust Companion Loan, the Trustee shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party3.35(c), respectively) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trust.
Appears in 2 contracts
Samples: Pooling and Servicing Agreement (JPMBB Commercial Mortgage Securities Trust 2014-C23), Pooling and Servicing Agreement (JPMBB Commercial Mortgage Securities Trust 2014-C22)
Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the The Special Servicer shall, shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates thereof (each a “Borrower-Related Party”) Mortgagor against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the TrustMortgagor, or of the Mortgagor guarantor or other Borrower-Related Party obligor under the related Mortgage Loan documents, Documents or with respect to the related Mortgaged Property Trust or other collateral securing such Mortgage Loan (or Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party Mortgagor, guarantor or other obligor under the related Mortgage Loan documents Documents, under the Mortgage Loan Documents (“Trust-Related Litigation”). In the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)subsection, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such Trust-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.31(e); and provided, however, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder Subordinate Class Representative (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a during any Subordinate Control Period or Collective Consultation Termination EventPeriod) (to the extent the identity of the Directing Certificateholder Subordinate Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing CertificateholderSubordinate Class Representative) and the related holder of any related Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), ) and the Directing Certificateholder Subordinate Class Representative (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a during any Subordinate Control Termination EventPeriod) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Subordinate Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Subordinate Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderSubordinate Class Representative’s response.
(d) Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Subordinate Class Representative that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.31 below, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent or consultation of the Subordinate Class Representative during a Subordinate Control Period or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Collective Consultation Termination EventPeriod, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)respectively) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in Trust-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.31.
(i) This Section 3.32 3.31 shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, (iA) in the event that any action, suit, litigation or proceeding names the Trustee in its individual capacity, or in the event that any judgment is rendered against the Trustee in its individual capacity, the Trustee, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiB) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, or (Ciii) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent); and (iiiC) in the event that any court finds that the Trustee is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of Subordinate Class Representative during a Subordinate Control Termination Event Period or the occurrence and continuance of a Collective Consultation Termination EventPeriod, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party3.31(c), respectively) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trust.
Appears in 2 contracts
Samples: Pooling and Servicing Agreement (Wells Fargo Commercial Mortgage Trust 2014-Lc16), Pooling and Servicing Agreement (Wells Fargo Commercial Mortgage Trust 2014-Lc16)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicerServicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such Trust-Related Litigationnamed), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the such Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly quarterly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to material decisions and resolutions material monetary settlements related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; . If and/or once the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan-Related Litigation as provided that in Section 3.33(a) above, the Master Servicer shall no longer have the right reporting obligation set forth above and the Special Servicer’s selection of counsel shall be subject to engage separate counsel relating to claims against the consent of the Master Servicer to the extent set forth in Section 3.32(e); and providedwhich consent shall not be unreasonably withheld, howeverdelayed or conditioned. Further, that if there are claims against the Master Servicer Servicer, the Trust and the Master Servicer has not determined that separate counsel is required for such claimsSpecial Servicer, such counsel each party at the request of the other, shall be reasonably acceptable to the Master Servicerenter into a joint defense agreement in accordance with Section 3.33(h) below.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither of the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.32, the Master Servicer shall retain the right at all times to make determinations final decisions in the Master Servicer’s reasonable discretion, relating to claims against the Master ServicerServicer where a settlement by the Special Servicer does not meet the conditions set forth in subclauses (i) through (v) of the first sentence of clause (g) below, including but not limited to the right to engage separate counsel counsel, to make settlement decisions with respect to claims asserted against the Master Servicer and to appear in any proceeding on its own behalf behalf. The cost related to or incurred in the Master Servicer’s reasonable discretion, the cost of which connection with exercising such rights shall be subject to indemnification as and to the extent provided in this Agreement. For the sake of clarity, the Master Servicer’s rights do not include the right to settle any claims against the Master Servicer without the Special Servicer’s consent if such settlement would (i) contain any admission of liability or wrongdoing on the part of the Master Servicer, the Trust, the Special Servicer or any other party to this Agreement, (ii) provide for the payment of damages or any sums for which the Master Servicer will seek indemnification from the Trust or any party to this Agreement or (iii) prejudice or impair the defense or counterclaims of the Trust or any party to this Agreement with respect to such Loan-Related Litigation.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) may not direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with without the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer unless (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (Ai) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master ServicerServicer and the Master Servicer is fully released, (Bii) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (Ciii) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (Div) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (Ev) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (Ai), (Bii), (iii) and (Civ). With respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall (i) to the extent that the Master Servicer and the Special Servicer deem it appropriate, use reasonable efforts to enter into a joint defense agreement and (ii) cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. Section.
(i) This Section 3.32 shall not apply in and to the event extent that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, Midland Loan Services, a Division of PNC Bank, National Association is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination whether or not such replacement is effective or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 2 contracts
Samples: Pooling and Servicing Agreement (Wells Fargo Commercial Mortgage Trust 2017-C41), Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2017-C4)
Litigation Control. (a) With The Special Servicer shall with respect to any Mortgage Loan (other than a Non-Specially Serviced Mortgage Loans and at the direction of the Controlling Class Representative any other Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, in accordance with the Servicing Standard, (1) direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates thereof (each a “Borrower-Related Party”) Mortgagor against the Trust, the Master Servicer Trust Fund and/or the Special Servicer or any predecessor master servicer or special servicer, and (2) represent the interests of the Trust Fund in any litigation relating to the rights and obligations of the TrustMortgagor or the Trust Fund, or of the Mortgagor or other Borrower-Related Party under the related Mortgage Loan documents, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party Mortgagor, under the related Mortgage Loan documents (“Trust-Related Litigation”). In the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the Fund or Special Servicer is not named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i1) notify the Special Servicer of such Trust-Related Litigation within ten (10) days of the Master Servicer receiving service of such Trust-Related Litigation; (2) provide monthly status reports to the Special Servicer, regarding such Trust-Related Litigation; (ii3) seek to have the Trust Fund replace the Master Servicer as the appropriate party to the lawsuit; and (iii4) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust Fund in such Trust-Related Litigation, including but not limited to the selection of counsel; , provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e); and provided, however, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) (to the extent the identity of the Directing Certificateholder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) Business Day period, then the Directing Certificateholder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Holders, the Special Servicer may take such action without waiting for the Directing Certificateholder’s response.
(d) Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may be, responsibilities under this Agreement.
(e) . Notwithstanding the right of the Special Servicer to represent the interests of the Trust Fund in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.31 below, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and pursuant to the extent provided in this Agreement.
(f) Section 3.31. Further, nothing in this section shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith and reasonable judgment, may (i1) result in a violation of the an Adverse REMIC Provisions Event or Adverse Grantor Trust Event or (ii2) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement.
(g) . Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i1) direct the Master Servicer to settle any claims brought against the Trust Fund, including claims asserted against the Master Servicer (whether or not the Trust Fund or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii2) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust Fund or the Special Servicer is named in any such claims or Trust-Related Litigation), ; provided in either case that (A) such settlement or other direction does not require any admission admission, or is not likely to result in a finding of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this AgreementFund, (C) the Master Servicer is and shall be indemnified as and pursuant to the extent provided in this Agreement Section 6.03 hereof for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(h) . In the event both the Master Servicer and the Special Servicer or Trust Fund are named in Trust-Related Litigationlitigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.323.31. This Section 3.32 shall not apply in Notwithstanding anything to the event the Special Servicer authorizes the Master Servicercontrary herein, and if the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control controls certain Trust-Related Litigation on behalf of the Trust Fund with respect to Performing Serviced Mortgage Loans in accordance with this Section 3.31, the Servicing StandardSpecial Servicer shall retain the right to make determinations relating to claims against the Special Servicer, including but not limited to the right to engage separate counsel in the Special Servicer’s reasonable discretion, the cost of which shall be subject to indemnification pursuant to Section 6.03. Notwithstanding Nothing in this Section 3.31 shall be intended to limit the foregoingrights of the Controlling Class Representative under any other section of this Agreement. The Special Servicer or the Master Servicer, as applicable, will have the right to direct, manage, prosecute and/or defend any and all litigation and/or claims relating to (a) the enforcement of the obligations of a Mortgagor under the related Mortgage Loan documents and (b) any claim or action brought by a Mortgagor against the Trust Fund; provided that (i) in the event that any action, suit, litigation or proceeding names the Trustee in its individual capacity, or in the event that any judgment is rendered against the Trustee in its individual capacity, the Trustee, upon prior written notice to the Master Special Servicer or the Special Master Servicer, as the case may beapplicable, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); , (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor Mortgagor under the related Mortgage Loan documents, documents or otherwise relating to one or more a Mortgage Loans Loan or Mortgaged PropertiesProperty, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, (A) initiate an any action, suit, litigation or proceeding in the name of the Trustee, whether in such capacity or individually, (B) engage counsel to represent the Trustee, or (C) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions action with the intent to cause, and that actually causes, the Trustee to be registered to do business in any state (provided that neither none of the Master Servicer nor Servicer, the Special Servicer or the Trustee shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent); , and (iii) in the event that any court finds that the Trustee is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee or individually interest (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) shall be interpreted to preclude the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trust.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (Wachovia Bank Commercial Mortgage Trust Series 2006-C28)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the Trust, the Master Servicer and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party Party, under the related Mortgage Loan documentsor Loan Combination, as applicable, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such TrustLoan-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)subsection, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.33(e); and provided, howeverfurther, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel selected by the Special Servicer shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and the Uncertificated VRR Interest Owner and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder Certificateholder, the Uncertificated VRR Interest Owner or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section 3.33 to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.33, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation), provided in either case that (A) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C); and provided, further, that, with respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.33.
(i) This Section 3.32 shall not apply in the event event, and to the extent, that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, Rialto Capital Advisors, LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination (whether or not such replacement is effective) or such related Mortgage Loan or Loan Combination is an Excluded Special Servicer Mortgage Loan in respect of Rialto Capital Advisors, LLC as Special Servicer, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (Citigroup Commercial Mortgage Trust 2019-Gc43)
Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the The General Special Servicer shall, in accordance with the Servicing Standard, (1) direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or Mortgagor (other obligor on the related Note or any Affiliates thereof (each than a “BorrowerMortgagor with respect to a Co-Related Party”op Mortgage Loan) against the Trust, the Master Servicer Trust and/or the General Special Servicer or any predecessor master servicer or special servicer, and (2) represent the interests of the Trust in any litigation relating to the rights and obligations of such Mortgagor or the Trust, or of the Mortgagor or other Borrower-Related Party under the related Mortgage Loan documents, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party such Mortgagor, under the related Mortgage Loan documents (“"General Trust-Related Litigation”"). In The Co-op Special Servicer shall, (1) direct, manage, prosecute and/or defend any action brought by a Mortgagor with respect to the event that Co-op Mortgage Loans against the Trust and/or the Co-op Special Servicer and (2) represent the interests of the Trust in any litigation relating to the rights and obligations of such Mortgagor or the Trust, or the enforcement of the obligations of such Mortgagor under the related Mortgage Loan documents ("Co-op Trust-Related Litigation" and, collectively with General Trust-Related Litigation, "Trust-Related Litigation"). To the extent either Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the applicable Special Servicer is named, in order to effectuate the role of the applicable Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the applicable Master Servicer shall (i1) notify the General Special Servicer (with respect to General Trust-Related Litigation) or the Co-op Special Servicer (with respect to Co-op Trust-Related Litigation) of such Trust-Related Litigation within ten (10) days of such Master Servicer receiving service of such Trust-Related Litigation; (2) provide monthly status reports to the applicable Special Servicer, Servicer regarding such Trust-Related Litigation; (ii3) seek to have the Trust replace the applicable Master Servicer as the appropriate party to the lawsuit; and (iii4) so long as the applicable Master Servicer remains a party to the lawsuit, consult with and act at the direction of the applicable Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e); and , provided, however, that if there are claims against the applicable Master Servicer and the such Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the applicable Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) (to the extent the identity of the Directing Certificateholder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) Business Day period, then the Directing Certificateholder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Holders, the Special Servicer may take such action without waiting for the Directing Certificateholder’s response.
(d) . Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may be, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicers otherwise set forth above and below, (i) the Special Servicer to direct shall provide the Master Servicer’s actions in this Section 3.32, the applicable Master Servicer with copies of any notices, process and/or pleadings submitted and/or filed in any such action, suit, litigation or proceeding; (ii) the applicable Master Servicer may retain its own counsel, whose reasonable costs shall retain be paid by the right to make determinations relating to claims against the Master ServicerTrust under Section 8.24, including but not limited to the right to engage separate counsel and to appear in any action, suit, litigation or proceeding on its own behalf in order to represent, protect and defend its interests; and (iii) the applicable Master Servicer shall have the right to approve or disapprove of any judgment, settlement, final order or decree that may impose liability on the applicable Master Servicer or otherwise materially and adversely affect the applicable Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and including, but not limited to, damage to the extent provided in this Agreement.
(f) applicable Master Servicer's reputation as a master servicer. Further, nothing in this section shall require the a Master Servicer to take or fail to take any action which, in the such Master Servicer’s 's good faith and reasonable judgment, may (i1) result in a violation of the an Adverse REMIC Provisions Event or Adverse Grantor Trust Event or (ii2) subject the such Master Servicer to liability or materially expand the scope of the such Master Servicer’s 's obligations under this Agreement.
(g) Notwithstanding . Subject to the rights of the Master Servicer’s right to make determinations relating to claims against the Master ServicerServicer set forth above and below, the General Special Servicer and the Co-op Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i1) direct the General Master Servicer and the NCB Master Servicer, respectively, to settle any claims Trust Related Litigation brought against the Trust, including Trust Related Litigation asserted against the General Master Servicer or the NCB Master Servicer, respectively (whether or not the Trust or the applicable Special Servicer is named in any such Trust-Related Litigation) and (2) otherwise reasonably direct the actions of the General Master Servicer and the NCB Master Servicer, respectively, relating to Trust Related Litigation against such Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the applicable Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of such Master Servicer or otherwise materially and adversely affect the applicable Master Servicer, including, but not limited to, damage to the applicable Master Servicer's reputation as a master servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this AgreementTrust, (C) the such Master Servicer is and shall be indemnified as and pursuant to the extent provided in this Agreement Section 8.24 hereof for all costs and expenses of the such Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the such Master Servicer at the direction of the applicable Special Servicer shall be deemed (as to the such Master Servicer) to be in compliance with the Servicing Standard and (E) the such Special Servicer provides the applicable Master Servicer with assurance reasonably satisfactory to the such Master Servicer as to the items in clauses (A), (B) and (C).
(h) . In the event both more than one of the Master Servicer Servicers and the Special Servicer Servicers or Trust are named in Trust-Related Litigationlitigation, the applicable Master Servicer Servicers and the applicable Special Servicer Servicers shall cooperate with each other to afford the applicable Master Servicer Servicers and the applicable Special Servicer the rights afforded to such party in this Section 3.329.40. This Section 3.32 9.40 shall not apply in the event the General Special Servicer authorizes the General Master Servicer, or the Co-op Special Servicer authorizes the NCB Master Servicer, and the applicable Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing StandardTrust. Notwithstanding the foregoing, (ia) in the event that any action, suit, litigation or proceeding names the Trustee in its individual capacity, or in the event that any judgment is rendered against the Trustee in its individual capacity, the Trustee, upon prior written notice to the all applicable Master Servicer Servicers or the Special Servicer, as the case may beServicers, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not provided that the applicable Master Servicer or applicable Special Servicer shall retain the right to otherwise directmanage and direct any such action, manage or prosecute such suit, litigation or claimproceeding); (iib) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documents, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the General Master Servicer (with respect to the Mortgage Loans other than the NCB, FSB Loans and the NCCB Loan) nor the General Special Servicer (with respect to the Mortgage Loans other than the Co-op Mortgage Loans) and neither the NCB Master Servicer (with respect to the NCB, FSB Loans and the NCCB Loan) nor the Co-op Special Servicer (with respect to the Co-op Mortgage Loans) shall, without the prior written consent of the Trustee, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, or (Ciii) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions action with the intent to cause, and that actually causes, the Trustee LaSalle to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent)state; and (iiic) in the event that any court finds that the Trustee is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee or individually (but not to otherwise direct, manage provided that the applicable Master Servicer or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) shall be interpreted to preclude the applicable Special Servicer (with respect shall retain the right to manage and direct any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trustproceeding).
Appears in 1 contract
Samples: Pooling and Servicing Agreement (Morgan Stanley Capital I Trust 2006-Iq11)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicerServicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such Trust-Related Litigationnamed), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the such Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly quarterly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to material decisions and resolutions material monetary settlements related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; . If and/or once the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan-Related Litigation as provided that in Section 3.33(a) above, the Master Servicer shall no longer have the right to engage separate counsel relating to claims against the Master Servicer reporting obligation set forth above and, to the extent set forth in Section 3.32(e); and provided, however, that if there are claims against the Master Servicer and the Master Servicer has not determined that engaged separate counsel is required for such claimscounsel, such the Special Servicer’s selection of counsel shall be reasonably acceptable subject to the consent of the Master Servicer, which consent shall not be unreasonably withheld, delayed, or conditioned.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither of the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.32, the Master Servicer shall retain the right at all times to (i) make determinations final decisions in the Master Servicer’s reasonable discretion relating to claims against the Master ServicerServicer where a settlement by the Special Servicer does not meet the conditions set forth in subclauses (i) through (v) of the first sentence of clause (g) below, including but not limited to the right to (ii) engage separate counsel counsel, (iii) make settlement decisions with respect to claims asserted against the Master Servicer where a settlement by the Special Servicer does not meet the conditions set forth in subclauses (i) through (v) of the first sentence of clause (g) below, and to (iv) appear in any proceeding on its own behalf behalf. The cost related to or incurred in the Master Servicer’s reasonable discretion, the cost of which connection with exercising such rights shall be subject to indemnification as and to the extent provided in this Agreement. For the sake of clarity, the Master Servicer’s rights do not include the right to settle any claims against the Master Servicer without the Special Servicer’s consent if such settlement would (i) contain any admission of liability or wrongdoing on the part of the Master Servicer, the Trust, the Special Servicer or any other party to this Agreement, (ii) provide for the payment of damages or any sums for which the Master Servicer will seek indemnification from the Trust or any party to this Agreement or (iii) prejudice or impair the defense or counterclaims of the Trust or any party to this Agreement with respect to such Loan-Related Litigation.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with without the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (Ai) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master ServicerServicer and the Master Servicer is fully released, (Bii) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (Ciii) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (Div) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (Ev) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (Ai), (Bii), (iii) and (Civ). With respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. Section.
(i) This Section 3.32 shall not apply in and to the event extent that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, Midland Loan Services, a Division of PNC Bank, National Association is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination (whether or not such replacement is effective) or such related Mortgage Loan or Loan Combination is an Excluded Special Servicer Mortgage Loan in respect of Midland Loan Services, a Division of PNC Bank, National Association as Special Servicer or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (CSAIL 2018-C14 Commercial Mortgage Trust)
Litigation Control. (a) With The Special Servicer (with respect to any each Mortgage Loan (and Serviced Loan Combination other than a Non-Serviced any Excluded Special Servicer Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, ) shall in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates affiliates thereof (each a “Borrower-Related Party”) against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicerServicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor or other Borrower-Related Party under the related a Mortgage Loan documentsor Loan Combination, or with respect to as applicable, the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)Loan Combination, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party under the related Mortgage Loan documents Documents (“TrustLoan-Related Litigation”). In the event that the Master Servicer is named in any TrustLoan-Related Litigation but the Special Servicer is not named in such TrustLoan-Related Litigation (and regardless of whether the Trust is named in such Trust-Related Litigationnamed), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such TrustLoan-Related Litigation.
(b) To the extent the Master Servicer is named in the TrustLoan-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the such Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i) provide monthly quarterly status reports to the Special Servicer, regarding such TrustLoan-Related Litigation; (ii) seek use reasonable efforts to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to material decisions and resolutions material monetary settlements related to the interests of the Trust in such TrustLoan-Related Litigation, including but not limited to the selection of counsel; . If and/or once the Trust and/or the Special Servicer are named, the Special Servicer shall assume control of the Loan-Related Litigation as provided that in Section 3.33(a) above, the Master Servicer shall no longer have the right reporting obligation set forth above and the Special Servicer's selection of counsel shall be subject to engage separate counsel relating to claims against the consent of the Master Servicer to the extent set forth in Section 3.32(e); and providedwhich consent shall not be unreasonably withheld, howeverdelayed or conditioned. Further, that if there are claims against the Master Servicer Servicer, the Trust and the Master Servicer has not determined that separate counsel is required for such claimsSpecial Servicer, such counsel each party at the request of the other shall be reasonably acceptable to the Master Servicerenter into a joint defense agreement in accordance with Section 3.33(h) below.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any TrustLoan-Related Litigation or (ii) initiate any material TrustLoan-Related Litigation unless and until it has notified in writing the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan and for so long as to such party and prior to the occurrence and continuance of a no Consultation Termination Event) (Event has occurred and is continuing and to the extent the identity of the Directing Certificateholder Controlling Class Representative is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) Controlling Class Representative), and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced a Companion Loan) (Loan and to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder Controlling Class Representative (only if the related Mortgage Loan is not an Excluded Mortgage Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a for so long as no Control Termination EventEvent has occurred and is continuing) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder Controlling Class Representative has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) 5 Business Day period, then the Directing Certificateholder Controlling Class Representative shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and the Uncertificated Interest Owners and, with respect to a Serviced Whole LoanLoan Combination, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing CertificateholderControlling Class Representative’s response.
(d) Notwithstanding anything to the foregoingcontrary in this Section 3.33, neither of the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) Controlling Class Representative that would require or cause the such Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the such Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole LoanLoan Combination, expose any Certificateholder Certificateholder, any Uncertificated Interest Owner or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any either Trust REMIC created hereunder to fail to qualify as a REMIC, or any Grantor Trust created hereunder to fail to qualify as a grantor trust for federal income tax purposes or result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions Provisions, or materially expand the scope of the Special Servicer’s or ’s, the Master Servicer’s, the Certificate Administrator’s or the Trustee’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer provided in this Section to represent the interests of the Trust in TrustLoan-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.32, the Master Servicer shall retain the right at all times to make determinations final decisions in the Master Servicer's reasonable discretion, relating to claims against the Master ServicerServicer where a settlement by the Special Servicer does not meet the conditions set forth in subclauses (i) through (v) of the first sentence of clause (g) below, including but not limited to the right to engage separate counsel counsel, to make settlement decisions with respect to claims asserted against the Master Servicer and to appear in any proceeding on its own behalf behalf. The cost related to or incurred in the Master Servicer’s reasonable discretion, the cost of which connection with exercising such rights shall be subject to indemnification as and to the extent provided in this Agreement. For the sake of clarity, the Master Servicer’s rights do not include the right to settle any claims against the Master Servicer without the Special Servicer’s consent if such settlement would (i) contain any admission of liability or wrongdoing on the part of the Master Servicer, the Trust, the Special Servicer or any other party to this Agreement, (ii) provide for the payment of damages or any sums for which the Master Servicer will seek indemnification from the Trust or any party to this Agreement or (iii) prejudice or impair the defense or counterclaims of the Trust or any party to this Agreement with respect to such Loan-Related Litigation.
(f) Further, nothing in this section Section shall require the Master Servicer, any Special Servicer or any other party to this Agreement to take or fail to take any action which, in the Master Servicersuch party’s good faith and reasonable judgment, may (i) result in a violation of the REMIC Provisions or (ii) Grantor Trust Provisions, subject the Master Servicer, any Special Servicer or other such party to liability liability, or materially expand the scope of the Master Servicer’s, any Special Servicer or such party’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) may not direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or TrustLoan-Related Litigation) (and with respect to any material settlements, with without the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer unless (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (Ai) such settlement or other direction does not contain or require any admission of liability liability, wrongdoing or wrongdoing consent to injunctive relief on the part of the Master ServicerServicer and the Master Servicer is fully released, (Bii) the cost of such settlement or any resulting judgment is and shall be paid by the Trust pursuant to the terms of this Agreement, and payment of such cost or judgment is provided for in this Agreement, (Ciii) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the TrustLoan-Related Litigation and for any related judgment, (Div) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (Ev) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (Ai), (Bii), (iii) and (Civ). With respect to any material settlements with respect to any Mortgage Loan other than an Excluded Mortgage Loan, the Special Servicer shall be required to obtain the consent or consultation of the Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or Consultation Termination Event, respectively.
(h) In the event both the Master Servicer and the Special Servicer or Trust are named in TrustLoan-Related Litigation, the Master Servicer and the Special Servicer shall (i) to the extent that the Master Servicer and the Special Servicer deem it appropriate, use reasonable efforts to enter into a joint defense agreement and (ii) cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. Section.
(i) This Section 3.32 shall not apply in and to the event extent that the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain TrustLoan-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, and subject to the requirements of the second sentence in the second paragraph of Section 3.01(a) of this Agreement and subject to the power of attorney, (ix) in the event that any action, suit, litigation or proceeding names the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, in its respective individual capacity, or in the event that any judgment is rendered against the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (iiy) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documentsDocuments, or otherwise relating to one or more Mortgage Loans or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (Ai) initiate an action, suit, litigation or proceeding in the name of the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, whether in such capacity or individually, (Bii) engage counsel to represent the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, (iii) settle any claim giving rise to liability to the Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, in its individual capacity, or (Civ) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor to grant such consent); and (iiiz) in the event that any court finds that the Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Trustee, the Certificate Administrator, the Custodian or the Operating Advisor, as applicable, shall have the right to retain separate counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee Trustee, Certificate Administrator, Custodian or Operating Advisor, as applicable, or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material TrustLoan-Related LitigationLitigation with respect to any Mortgage Loan other than an Excluded Mortgage Loan, with the consent or consultation of the Directing Certificateholder Controlling Class Representative prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its own name as representative of the Trustee Trust.
(k) Notwithstanding the foregoing or anything to the contrary in this Section, this Section shall not apply to any Loan-Related Litigation and shall have no force and effect with respect thereto, in the event that either (i) at the time such Loan-Related Litigation is commenced or at any time during the continuance of such Loan-Related Litigation, CWCapital Asset Management LLC is no longer the Special Servicer with respect to the related Mortgage Loan or related Loan Combination or has received notice of its replacement as Special Servicer with respect to the related Mortgage Loan or related Loan Combination, whether or not such replacement is effective, or (ii) the Depositor, any Sponsor, any Mortgage Loan Seller, any Initial Purchaser, any Underwriter, or any of their respective affiliates is an adverse party (with respect to the Trust or the Special Servicer) in such Loan-Related Litigation or holds any interest which is adverse to the Trust or the Special Servicer in the related Mortgage Loan or related Loan Combination (or any portion thereof) or the related Mortgaged Property to which Loan-Related Litigation relates, unless otherwise agreed to in writing by each of the TrustDepositor, Sponsor, Mortgage Loan Seller, Initial Purchaser, Underwriter, or affiliate that is such a party or holds such interest. For the avoidance of doubt, the rights and obligations of the Master Servicer and the Special Servicer relating to any Loan-Related Litigation shall be limited solely to the representation of the Trust and itself, separate and apart from the interests of any other party thereto. For the further avoidance of doubt, in such circumstance described in this paragraph, the rights and obligations of the Master Servicer and the Special Servicer relating to litigation shall be as otherwise set forth with respect to servicing in this Agreement.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (BMO 2022-C1 Mortgage Trust)
Litigation Control. (a) With The Special Servicer shall with respect to any Mortgage Loan (other than a Non-Specially Serviced Mortgage Loans and at the direction of the Controlling Class Representative any other Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the Special Servicer shall, in accordance with the Servicing Standard, (1) direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates thereof (each a “Borrower-Related Party”) Mortgagor against the Trust, the Master Servicer Trust Fund and/or the Special Servicer or any predecessor master servicer or special servicer, and (2) represent the interests of the Trust Fund in any litigation relating to the rights and obligations of the TrustMortgagor or the Trust Fund, or of the Mortgagor or other Borrower-Related Party under the related Mortgage Loan documents, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party Mortgagor, under the related Mortgage Loan documents (“Trust-Related Litigation”). In the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the Fund or Special Servicer is not named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)paragraph, the Master Servicer shall (i1) notify the Special Servicer of such Trust-Related Litigation within ten (10) days of the Master Servicer receiving service of such Trust-Related Litigation; (2) provide monthly status reports to the Special Servicer, regarding such Trust-Related Litigation; (ii3) seek to have the Trust Fund replace the Master Servicer as the appropriate party to the lawsuit; and (iii4) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust Fund in such Trust-Related Litigation, including but not limited to the selection of counsel; , provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e); and provided, however, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) (to the extent the identity of the Directing Certificateholder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) Business Day period, then the Directing Certificateholder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Holders, the Special Servicer may take such action without waiting for the Directing Certificateholder’s response.
(d) Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may be, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust Fund in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.30 below, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and pursuant to the extent provided in this AgreementSection 3.30.
(fd) Further, nothing in this section shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith and reasonable judgment, may (i1) result in a violation of the an Adverse REMIC Provisions Event or Adverse Grantor Trust Event or (ii2) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement.
(ge) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i1) direct the Master Servicer to settle any claims brought against the Trust Fund, including claims asserted against the Master Servicer (whether or not the Trust Fund or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii2) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust Fund or the Special Servicer is named in any such claims or Trust-Related Litigation), ; provided in either case that (A) such settlement or other direction does not require any admission admission, or is not likely to result in a finding of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this AgreementFund, (C) the Master Servicer is and shall be indemnified as and pursuant to the extent provided in this Agreement Section 6.03 hereof for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(hf) In the event both the Master Servicer and the Special Servicer or Trust Fund are named in Trust-Related Litigationlitigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. This Section 3.32 shall not apply in 3.30.
(g) Notwithstanding anything to the event the Special Servicer authorizes the Master Servicercontrary herein, and if the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control controls certain Trust-Related Litigation on behalf of the Trust Fund with respect to performing, serviced Mortgage Loans in accordance with this Section 3.30, the Servicing StandardSpecial Servicer shall retain the right to make determinations relating to claims against the Special Servicer, including but not limited to the right to engage separate counsel in the Special Servicer’s reasonable discretion, the cost of which shall be subject to indemnification pursuant to Section 6.03. Notwithstanding Nothing in this Section 3.30 shall be intended to limit the foregoingrights of the Controlling Class Representative under any other section of this Agreement.
(h) The Special Servicer or the Master Servicer, as applicable, will have the right to direct, manage, prosecute and/or defend any and all litigation and/or claims relating to (a) the enforcement of the obligations of a Mortgagor under the related Mortgage Loan documents and (b) any claim or action brought by a Mortgagor against the Trust Fund; provided that (i) in the event that any action, suit, litigation or proceeding names the Trustee in its individual capacity, or in the event that any judgment is rendered against the Trustee in its individual capacity, the Trustee, upon prior written notice to the Master Special Servicer or the Special Master Servicer, as the case may beapplicable, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); , (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor Mortgagor under the related Mortgage Loan documents, documents or otherwise relating to one or more a Mortgage Loans Loan or Mortgaged PropertiesProperty, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, (A) initiate an any action, suit, litigation or proceeding in the name of the Trustee, whether in such capacity or individually, (B) engage counsel to represent the Trustee, or (C) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions action with the intent to cause, and that actually causes, the Trustee to be registered to do business in any state (provided that neither none of the Master Servicer nor Servicer, the Special Servicer or the Trustee shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent); , and (iii) in the event that any court finds that the Trustee is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee or individually interest (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) paragraph shall be interpreted to preclude either the Master Servicer or the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its name as a representative of the Trustee of the Trustor Trust Fund.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (Wachovia Bank Commercial Mortgage Trust Series 2007-C34)
Litigation Control. (a) With respect to any Mortgage Loan (other than a Non-Serviced Mortgage Loan), any Serviced Companion Loan or any related REO Loan or related REO Property, the The Special Servicer shall, in accordance with the Servicing Standard, direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates thereof (each a “Borrower-Related Party”) Mortgagor against the TrustTrust (including, without limitation, any action in which both the Trust and the Master Servicer are named) and/or the Special Servicer or any predecessor master servicer or special servicer, and represent the interests of the Trust in any litigation relating to the rights and obligations of the Trust, or of the Mortgagor Mortgagor, guarantor or other Borrower-Related Party obligor, in each case under the related Mortgage Loan documents or the ESK Companion Loan documents, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan)as applicable, or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party Mortgagor, guarantor or other obligor under the related Mortgage Loan documents or the ESK Companion Loan documents (“Trust-Related Litigation”). In the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related Litigation.
(b) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the Special Servicer is named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding Section 3.32(a)subsection, the Master Servicer shall (i) provide monthly status reports to the Special Servicer, regarding such Trust-Related Litigation; (ii) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e3.35(e); and provided, however, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the Master Servicer.
(c) The Special Servicer shall not (i) undertake (or direct the Master Servicer to undertake) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) (to the extent the identity of the Directing Certificateholder is actually known to the Special Servicer; provided that the Special Servicer shall make due inquiry of the Certificate Administrator as to the identity of the Directing Certificateholder) and the related holder of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer), ) and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) -Business Day period, then the Directing Certificateholder shall be deemed to have approved the taking of such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders and, with respect to a Serviced Whole Loan, the related Companion Loan Holders, the Special Servicer may take such action without waiting for the Directing Certificateholder’s response.
(d) Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan, Serviced Whole Loan or Serviced the ESK Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may beapplicable, responsibilities under this Agreement.
(e) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s actions in this Section 3.323.35 below, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) Further, nothing in this section shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s good faith and reasonable judgment, may may
(i) result in a violation of the REMIC Provisions or (ii) subject the Master Servicer to liability or materially expand the scope of the Master Servicer’s obligations under this Agreement.
(g) Notwithstanding the Master Servicer’s right to make determinations relating to claims against the Master Servicer, the Special Servicer shall have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent or consultation of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)respectively) and (ii) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (A) such settlement or other direction does not require any admission of liability or wrongdoing on the part of the Master Servicer, (B) the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this Agreement, (C) the Master Servicer is and shall be indemnified as and to the extent provided in this Agreement for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Related Litigation and for any judgment, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(h) In the event both the Master Servicer and the Special Servicer or of the Trust are named in Trust-Related Litigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. 3.35.
(i) This Section 3.32 3.35 shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation on behalf of the Trust in accordance with the Servicing Standard. .
(j) Notwithstanding the foregoing, (i) in the event that any action, suit, litigation or proceeding names the Trustee in its individual capacity, or in the event that any judgment is rendered against the Trustee in its individual capacity, the Trustee, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not to otherwise direct, manage or prosecute such litigation or claim); (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor under the related Mortgage Loan documents or the ESK Companion Loan documents, or otherwise relating to one or more Mortgage Loans or the ESK Companion Loan or Mortgaged Properties, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Trustee, (A) initiate an action, suit, litigation or proceeding in the name of the Trustee, whether in such capacity or individually, (B) engage counsel to represent the Trustee, or (C) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions with the intent to cause, and that actually causes, the Trustee to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent); and (iii) in the event that any court finds that the Trustee is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan or the ESK Companion Loan, the Trustee shall have the right to retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests, whether as Trustee or individually (but not to otherwise direct, manage or prosecute such litigation or claim); provided, however, that nothing in this Section 3.32(h) subsection shall be interpreted to preclude the Special Servicer (with respect to any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party3.35(c), respectively) from initiating any action, suit, litigation or proceeding in its name as representative of the Trustee of the Trust.
Appears in 1 contract
Samples: Pooling and Servicing Agreement (JPMBB Commercial Mortgage Securities Trust 2014-C24)
Litigation Control. (ai) With The Special Servicer (with respect to any Specially Serviced Mortgage Loan and, if directed by the Directing Certificateholder, any Mortagage Loan) or the Master Servicer (other than a with respect to any Non-Specially Serviced Mortgage Loan, unless otherwise directed by the Directing Certificateholder), any Serviced Companion Loan or any related REO Loan or related REO Propertyas the case may be, the Special Servicer shall, in accordance with the Servicing Standard, (1) direct, manage, prosecute and/or defend any action brought by a Mortgagor, guarantor, or other obligor on the related Note or any Affiliates thereof (each a “Borrower-Related Party”) Mortgagor against the Trust, the Master Servicer Trust and/or the Special Servicer or any predecessor master servicer or special servicer, and (2) represent the interests of the Trust in any litigation relating to the rights and obligations of the Mortgagor or the Trust, or of the Mortgagor or other Borrower-Related Party under the related Mortgage Loan documents, or with respect to the related Mortgaged Property or other collateral securing such Mortgage Loan (or Serviced Whole Loan), or otherwise with respect to the enforcement of the obligations of a Borrower-Related Party borrower, under the related Mortgage Loan documents Documents (“for purposes of this Section 3.32(a), "Trust-Related Litigation”). In ") with respect to the event that the Master Servicer is named in any Trust-Related Litigation but the Special Servicer is not named in such Trust-Related Litigation (regardless of whether the Trust is named in such Trust-Related Litigation), the Master Servicer shall notify the Special Servicer of such litigation as soon as practicable but in any event no later than within ten (10) Business Days of the Master Servicer receiving service of such Trust-Related LitigationMortgage Loans.
(bii) To the extent the Master Servicer is named in the Trust-Related Litigation, and neither the Trust nor the or Special Servicer is not named, in order to effectuate the role of the Special Servicer as contemplated by the immediately preceding set forth in this Section 3.32(a), the Master Servicer shall (i1) notify the Special Servicer of such Trust Related Litigation within ten (10) days of the Master Servicer receiving service of such Trust Related Litigation; (2) provide monthly status reports to the Special Servicer, regarding such Trust-Related Litigation; (ii3) seek to have the Trust replace the Master Servicer as the appropriate party to the lawsuit; and (iii4) so long as the Master Servicer remains a party to the lawsuit, consult with and act at the direction of the Special Servicer with respect to decisions and resolutions related to the interests of the Trust in such Trust-Related Litigation, including but not limited to the selection of counsel; provided that the Master Servicer shall have the right to engage separate counsel relating to claims against the Master Servicer to the extent set forth in Section 3.32(e); and , provided, however, that if there are claims against the Master Servicer and the Master Servicer has not determined that separate counsel is required for such claims, such counsel shall be reasonably acceptable to the Master Servicer.
(c) The . If the Special Servicer shall not (i) undertake (or direct handles a claim in which the Master Servicer to undertake(individually or in such capacity) any material settlement of any Trust-Related Litigation or (ii) initiate any material Trust-Related Litigation unless and until it has notified in writing the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan as to such party and prior to the occurrence and continuance of a Consultation Termination Event) (to the extent the identity of the Directing Certificateholder is actually known to the Special Servicer; provided that named, the Special Servicer shall make due inquiry of provide the Certificate Administrator as to the identity of the Directing Certificateholder) and the related holder Master Servicer with copies of any Serviced Companion Loan (if such matter affects such related Serviced Companion Loan) (to the extent the identity of the holder of such Serviced Companion Loan is actually known to the Special Servicer)notices, and the Directing Certificateholder (only if the related Mortgage Loan is not an Excluded Loan with respect to the Directing Certificateholder or the Holder of the majority of the Controlling Class and prior to the occurrence and continuation of a Control Termination Event) has not objected process and/or pleadings submitted and/or filed in writing within five (5) Business Days of having been notified thereof and having been provided with all information that the Directing Certificateholder has reasonably requested with respect thereto promptly following its receipt of the subject notice (it being understood and agreed that if such written objection has not been received by the Special Servicer within such five (5) Business Day period, then the Directing Certificateholder shall be deemed to have approved the taking of any such action); provided that, if the Special Servicer determines (consistent with the Servicing Standard) that immediate action is necessary to protect the interests of the Certificateholders andsuit, with respect to a Serviced Whole Loan, the related Companion Holders, the Special Servicer may take such action without waiting for the Directing Certificateholder’s responselitigation or proceeding.
(d) Notwithstanding the foregoing, neither the Special Servicer nor the Master Servicer shall follow any advice, direction or consultation provided by the Directing Certificateholder or the Risk Retention Consultation Party (or any other party to this Agreement) that would require or cause the Special Servicer or the Master Servicer, as applicable, to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer or the Master Servicer, as applicable, to violate provisions of this Agreement, require or cause the Special Servicer or the Master Servicer, as applicable, to violate the terms of any Mortgage Loan or Serviced Whole Loan, expose any Certificateholder or any party to this Agreement or their Affiliates, officers, directors or agents to any claim, suit or liability, cause any REMIC created hereunder to fail to qualify as a REMIC, result in the imposition of a “prohibited transaction” or “prohibited contribution” tax under the REMIC Provisions or materially expand the scope of the Special Servicer’s or the Master Servicer’s, as the case may be, responsibilities under this Agreement.
(eiii) Notwithstanding the right of the Special Servicer to represent the interests of the Trust in Trust-Related Litigation, and subject to the rights of the Special Servicer to direct the Master Servicer’s 's actions in this Section 3.323.32(a)(iv) below, the Master Servicer shall retain the right to make determinations relating to claims against the Master Servicer, including but not limited to the right to engage separate counsel and to appear in any proceeding on its own behalf in the Master Servicer’s reasonable discretion, the cost of which shall be subject to indemnification as and to the extent provided in this Agreement.
(f) if necessary. Further, nothing in this section shall require the Master Servicer to take or fail to take any action which, in the Master Servicer’s 's good faith and reasonable judgment, may (i1) result in a violation of the an Adverse REMIC Provisions Event or (ii2) subject the Master Servicer to material liability or materially expand the scope of the Master Servicer’s 's obligations under this Agreement.
(giv) Notwithstanding the Master Servicer’s 's right to make determinations relating to claims against the Master Servicer, the Special Servicer shall (1) have the right at any time in accordance with the Servicing Standard to (i) direct the Master Servicer to settle any claims brought against the Trust, including claims asserted against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation) (and with respect to any material settlements, with the consent of or in consultation with the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively (in each case, other than a Mortgage Loan that is an Excluded Loan as to such party)) and (ii2) otherwise reasonably direct the actions of the Master Servicer relating to claims against the Master Servicer (whether or not the Trust or the Special Servicer is named in any such claims or Trust-Related Litigation), provided in either case that (A) such settlement the Master Servicer shall have the right to approve or other direction does not require disapprove of any admission of judgement, settlement, final order or decree that may impose liability or wrongdoing on the part of Master Servicer or otherwise materially and adversely affect the Master Servicer, including but not limited to, damage to the Master Servicer's reputation as a master servicer, (B) the Master Servicer may retain its own counsel, whose reasonable costs shall be paid by the Trust subject to Section 6.03, and appear in any action, suit, litigation or proceeding on its own behalf in order to represent, protect and defend its interests, the cost of such settlement or any resulting judgment is and shall be paid by the Trust and payment of such cost or judgment is provided for in this AgreementTrust, (C) the Master Servicer is and shall be indemnified as and pursuant to the extent provided in this Agreement Section 6.03 hereof for all costs and expenses of the Master Servicer incurred in defending and settling the Trust-Trust Related Litigation and for any judgmentLitigation, (D) any such action taken by the Master Servicer at the direction of the Special Servicer shall be deemed (as to the Master Servicer) to be in compliance with the Servicing Standard Standard, and (E) the Special Servicer provides the Master Servicer with assurance reasonably satisfactory to the Master Servicer as to the items in clauses (A), (B) and (C).
(hv) In the event both the Master Servicer and the Special Servicer or Trust are named in Trust-Related Litigationlitigation, the Master Servicer and the Special Servicer shall cooperate with each other to afford the Master Servicer and the Special Servicer the rights afforded to such party in this Section 3.32. .
(vi) This Section 3.32 3.32(a) shall not apply in the event the Special Servicer authorizes the Master Servicer, and the Master Servicer agrees (both authority and agreement to be in writing), to make certain decisions or control certain Trust-Related Litigation litigation on behalf of the Trust in accordance with the Servicing Standard. Trust.
(b) Notwithstanding the foregoing, (i) in the event that any action, suit, litigation or proceeding names the Trustee Paying Agent or the Trustee, as applicable, in its individual capacity, or in the event that any judgment is rendered against the Trustee Paying Agent or the Trustee, as applicable, in its individual capacity, the Paying Agent or the Trustee, as applicable, upon prior written notice to the Master Servicer or the Special Servicer, as the case may beapplicable, may retain counsel and appear in any such proceeding on its own behalf in order to protect and represent its interests (but not interests; provided that the Master Servicer or Special Servicer, as applicable, shall retain the right to otherwise directmanage and direct any such action, manage or prosecute such suit, litigation or claim)proceeding; (ii) in the event of any action, suit, litigation or proceeding, other than an action, suit, litigation or proceeding relating to the enforcement of the obligations of a Mortgagor, guarantor or other obligor Mortgagor under the related Mortgage Loan documents, documents or otherwise relating to one or more a Mortgage Loans Loan or Mortgaged PropertiesProperty, neither the Master Servicer nor the Special Servicer shall, without the prior written consent of the Paying Agent or the Trustee, as applicable, (A) initiate an any action, suit, litigation or proceeding in the name of the Paying Agent or the Trustee, as applicable, whether in such capacity or individually, (B) engage counsel to represent the TrusteePaying Agent, or (C) prepare, execute or deliver any government filings, forms, permits, registrations or other documents or take any other similar actions action with the intent to cause, and that actually causes, the Trustee Paying Agent or the Trustee, as applicable, to be registered to do business in any state (provided that neither the Master Servicer nor the Special Servicer shall be responsible for any delay due to the unwillingness of the Trustee to grant such consent); state, and (iii) in the event that any court finds that the Trustee Paying Agent or the Trustee, as applicable, is a necessary party in respect of any action, suit, litigation or proceeding relating to or arising from this Agreement or any Mortgage Loan, the Trustee Paying Agent or the Trustee, as applicable shall have the right to retain counsel and appear in any such proceeding proceedings on its own behalf in order to protect and represent its interestsinterest, whether as Trustee Paying Agent or individually (but not to otherwise directthe Trustee, manage as applicable or prosecute such litigation individually; provided that the Master Servicer or claim); provided, however, that nothing in this Section 3.32(h) shall be interpreted to preclude the Special Servicer (with respect Servicer, as applicable, shall retain the right to manage and direct any material Trust-Related Litigation, with the consent or consultation of the Directing Certificateholder prior to the occurrence and continuance of a Control Termination Event or the occurrence and continuance of a Consultation Termination Event, respectively, to the extent required in Section 3.32(c) and only to the extent such Mortgage Loan is not an Excluded Loan as to such party) from initiating any action, suit, litigation or proceeding in its name as representative proceeding. [End of the Trustee of the Trust.Article III]
Appears in 1 contract
Samples: Pooling and Servicing Agreement (J.P. Morgan Chase Commercial Mortgage Securities Trust 2006-Cibc17)
