Also known as: surpluses · excess
Written by attorneys · grounded in primary & secondary sources — see below
2 senses
An amount remaining after a foreclosure sale or other disposition of collateral satisfies the secured obligation and associated costs. The surplus is distributed first to junior lienholders in order of priority and then to the mortgagor or debtor.
An amount remaining after a foreclosure sale or other disposition of collateral satisfies the secured obligation and associated costs. The surplus is distributed first to junior lienholders in order of priority and then to the mortgagor or debtor.
Sterling Dynamics held a first mortgage on Blackacre for $400,000. After default, the property sold at foreclosure for $520,000. The sale satisfied the first mortgage debt and costs, leaving $110,000. Junior lienholders received payment in priority order from that amount, and the remaining balance went to the mortgagor.
The excess of a corporation's net assets over the amount of its capital. Directors may authorize distributions only from this excess or from current or prior net profits when no surplus exists.
Sapphire Technologies directors approved a $2 million dividend when net assets exceeded capital by only $800,000. A shareholder sued the directors for the $1.2 million excess. The court held each director personally liable for the unlawful portion because they failed to confirm compliance with the surplus restriction before authorizing the distribution.
The excess of a corporation's net assets over the amount of its capital. Directors may authorize distributions only from this excess or from current or prior net profits when no surplus exists.
Each sense below has its own examples, sources, and questions.
A junior mortgagee obtained a receiver who collected $90,000 in rents from the property. The receiver first paid $25,000 in taxes and maintenance costs. The remaining $65,000 constituted surplus that the junior mortgagee could apply to its own obligation before any senior receiver was appointed.
Solstice Ventures, a limited partnership, paid all creditors $300,000 during winding up. It then held $150,000 in remaining assets. The surplus was first returned to partners for unreturned contributions and the balance distributed according to their rights to share in distributions immediately before dissolution.
Sophia Singh contracted to build custom cabinets for Summit Bank but the bank breached by refusing delivery after partial performance. Singh had conferred $180,000 in labor and materials. Because the bank's breach discharged Singh's remaining duties, she recovered the surplus value of her part performance that exceeded the loss caused by her own breach.
Summit Bank, an LLC, satisfied all creditor claims during dissolution and held $220,000 in assets. The surplus was first paid to members for unreturned contributions and any remainder distributed in proportion to their rights to share in distributions immediately before dissolution.
The surplus equals the sale proceeds minus the foreclosed debt and allowable costs. It is then paid to junior lienholders in order of priority and finally to the mortgagor.
The junior receiver must first apply rents to taxes and reasonable maintenance expenses. Only the excess after those payments may be applied to the junior obligation.
After creditors are paid, surplus first returns unreturned contributions to those holding transferable interests and then distributes any remainder in proportion to pre-dissolution distribution rights.
A breaching party may recover the value of part performance or reliance that exceeds the loss caused by its own breach when the other party justifiably refuses further performance.
A corporation may distribute assets only when it possesses sufficient surplus, defined as net assets exceeding capital, or when current or prior net profits exist in the absence of surplus.
…who makes a disbursement for the direct costs of producing and airing electioneering communications in an aggregate amount in excess of $10,000 during any calendar year” must disclose “the names and addresses of all contributors who contributed an aggregate amount of $1,000 or more to the person making the…