[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

________________________

No. 14-11106

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D.C. Docket No. 1:13-cv-20708-RSR

B.C. No. 11-bkc-03122-AJC

In Re:SAGAMORE PARTNERS, LTD.

Debtor.

_____________________________________________________________

JPMCC 2006-LDP7 MIAMI BEACH LODGING, LLC, et al.,

Plaintiffs-Appellants

Cross-Appellees,

versus

SAGAMORE PARTNERS, LTD.,

Defendant-Appellee

Cross-Appellant.

________________________

Appeals from the United States District Court

for the Southern District of Florida

________________________

(July 13, 2015)

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Before JORDAN, JULIE CARNES, and LINN,

∗ Circuit Judges.

LINN, Circuit Judge:

JPMCC 2006-LDP7 Miami Beach Lodging, LLC (“JPMCC”), Berkadia 

Commercial Mortgage, LLC (“Berkadia”), LNR Partners, LLC (“LNR”), Wells 

Fargo Bank, N.A., and U.S. National Bank Association (collectively “appellants”)

appeal the district court’s judgment affirming the bankruptcy court’s Order 

Confirming the Amended Plan of Reorganization of Sagamore Partners, Ltd. 

(“Sagamore”) but vacating and remanding the bankruptcy court’s denial of 

attorney’s fees and costs. See In re Sagamore Partners, Ltd., Bankruptcy Appeals, 

512 B.R. 296 (S.D. Fla. 2014) (“Op.”); In re Sagamore Partners, Ltd., No. 11-

37867-AJC (Bankr. S.D. Fla. Jan. 10, 2013); In re Sagamore Partners, Ltd., No. 

11-37867-AJC (Bankr. S.D. Fla. Dec. 26, 2012) (“Bankruptcy Op.”). Appellants

claim that the district court erred in affirming the bankruptcy court’s finding that 

they are not entitled to default-rate interest; in affirming the bankruptcy court’s 

finding that Sagamore’s reorganization plan is feasible; and in failing to address 

their rights to fees and costs incurred in connection with Sagamore’s bankruptcy. 

Appellants request that, should this Court find that they are entitled to default-rate 

 ∗ Honorable Richard Linn, United States Circuit Judge for the Federal Circuit, sitting by 

designation.

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interest, it further declare that the interest is due immediately. Sagamore crossappeals the district court’s conclusion that the Bankruptcy Code could ever require 

a debtor to pay default-rate interest to reinstate the original terms of a loan and the 

district court’s reversal of the bankruptcy court’s holding that JPMCC’s faulty 

notice precludes appellants from receiving default-rate interest. Finally, Sagamore 

argues that equitable mootness precludes appellate review.

Because the district court correctly ruled that a debtor may be required to 

pay default-rate interest to reinstate the original terms of a loan but erred in 

concluding that appellants waived their rights to default-rate interest, because the 

district court was correct that JPMCC’s notice of default did not preclude defaultrate interest, and because this appeal is not equitably moot, we reverse the district 

court’s determination that appellants are not entitled to default-rate interest. 

Because the bankruptcy court did not err in concluding that Sagamore’s plan was 

feasible, we affirm the district court’s approval of Sagamore’s plan. Because the

courts below have not yet addressed the question of whether appellants are entitled 

to the fees and costs incurred in connection with Sagamore’s bankruptcy and have 

not yet addressed the question of when Sagamore is required to pay default-rate 

interest, we remand these questions to the district court to address in the first 

instance.

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BACKGROUND

Sagamore owns the eponymous hotel. Martin Taplin (“Taplin”) indirectly 

owns or controls a 100% interest in the Sagamore Hotel. In 2006, Arbor 

Commercial Mortgage, LLC (“Arbor”) loaned Sagamore $31.5 million to 

refinance the hotel. The details of the loan are set out in a promissory note (the 

“Note”) and in a related loan agreement (the “Agreement”). Arbor assigned the 

Note and Agreement to JPMCC.

As relevant here, the Agreement required Sagamore to make interest-only 

payments of 6.54% per year until 2016, when all outstanding amounts would come

due. However, in the “Event of Default,” Sagamore would be required to pay a 

default-rate interest of 11.54%. An “Event of Default” would occur if Sagamore 

missed “any regularly scheduled payment with respect to any portion of the Debt 

when due.” The Agreement states that any “required or permitted” notice to 

Sagamore must be addressed to Sagamore’s Florida address with a copy sent to

Sagamore’s New York counsel. The agreement also recites that Sagamore 

“expressly waives, and shall not be entitled to any notices of any nature 

whatsoever from Lender” except for those notices that the Agreement or applicable 

law expressly require. The parties agree that the Agreement does not require 

JPMCC to provide a notice of default. The Note provides that if there is an Event 

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of Default, “regardless of whether or not there has been an acceleration of the 

indebtedness[, default-rate] interest shall accrue.”

Beginning in August of 2009, Sagamore stopped making its payments. On 

September 28, 2009, JPMCC sent a letter to Sagamore, but not to its New York 

counsel, declaring that Sagamore was in default. On November 19, 2009, JPMCC 

sent a letter to Sagamore and its New York counsel accelerating the obligation to 

repay the loan. Upon Sagamore’s failure to cure the default, JPMCC commenced a 

foreclosure action in state court in December of 2009. Sagamore filed for 

bankruptcy on October 6, 2011.

In February of 2012, JPMCC filed a Proof of Claim demanding 

“$31,500,000.00, interest from July 11, 2009, default interest, late charges, costs, 

attorneys’ fees, expenses, and all other charges and amounts accruing and imposed 

pursuant to the Loan Documents.” In response, Sagamore filed a Plan of 

Reorganization in which it sought to cure and “nullify[] all consequences of any 

alleged default” by paying the accrued pre-default-rate interest. JPMCC objected 

that the plan did not allow for default-rate interest. The Bankruptcy Court rejected 

the plan because it did not allow for default-rate interest, but noted that no defaultrate interest would be due if Sagamore could show that its “default [should] be 

excused, or that default is not otherwise due in accordance with the underlying 

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agreement and/or applicable non-bankruptcy law.” In re Sagamore Partners, Ltd., 

No. 11-37867-BKC-AJC at 10 (July 10, 2012), ECF No. 213.

Sagamore then filed an amended plan, which proposed a fund that would 

“have all of the funds required to reinstate the indebtedness, whatever that amount 

is, as determined by the Court, and on the terms and conditions imposed by the 

Court.” In connection with the amended plan, Sagamore also filed an objection to 

JPMCC’s Proof of Claim in which it argued that it did not owe default-rate 

interest, because JPMCC demanded late fees and a creditor is not entitled to both 

default-rate interest and late fees. JPMCC responded by waiving late fees “for any 

time period for which the Court allows default rate interest.” JPMCC Response to 

Objection to Claim at 3, Sagamore, No. 11-37867-AJC (Bankr. S.D. Fla. Jan. 10, 

2013), ECF No. 400; accord id. at 5 n.4, 20.

The difference between late fees and default-rate interest in this case is 

substantial. The late fees total less than a quarter of a million dollars while the 

default-rate interest is almost five and a half million dollars. The bankruptcy court 

ruled in favor of Sagamore. It found that JPMCC’s notice of default was defective, 

and that “all that flowed from the defective Default Notice is improper,” including 

JPMCC’s acceleration letter, Sagamore’s subsequent foreclosure and appellants’

efforts to charge default-rate interest, attorneys’ fees and other costs. Bankruptcy 

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Op. at 8–9. In the alternative, the bankruptcy court found that JPMCC failed to 

demand default-rate interest, id. at 11–15, and, moreover, “having asserted its 

entitlement to late fees, is precluded from also recovering default interest,” id. at 

15. Finally, the bankruptcy court rejected appellants’ claim that the plan of 

reorganization was not feasible. Id. at 23.

On appeal from the bankruptcy court’s order, the district court determined 

that the Event of Default occurred notwithstanding JPMCC’s insufficient notice 

and therefore remanded to the bankruptcy court the question of whether appellants 

were entitled to a partial award of attorneys’ fees and costs. Op. at 318–19. 

However, it affirmed the bankruptcy court’s conclusion that appellants waived 

default-rate interest. Id. at 314–17. Finally, the district court affirmed the 

bankruptcy court’s determination that Sagamore’s plan was feasible. Id. at 320–

21. 

This Court has jurisdiction over both the appeal and cross-appeal pursuant to 

28 U.S.C. §§ 158(d)(1), 1291 (2012), notwithstanding the district court’s partial 

remand on the question of attorney’s fees and costs, see In re Porto, 645 F.3d 

1294, 1299 (11th Cir. 2011).

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ANALYSIS

I. Standard of Review

In bankruptcy cases, this Court reviews all the district court’s determinations

and the bankruptcy court’s legal determinations de novo. In re Gamble, 168 F.3d 

442, 444 (11th Cir. 1999). This Court reviews the bankruptcy court’s factual 

findings for clear error, id., even if the bankruptcy court adopted one party’s 

proposed findings verbatim, see Rhode v. Hall, 582 F.3d 1273, 1282 n.5 (11th Cir. 

2009). “The interpretation of a contract is a question of law that the court reviews 

de novo.” Ave. CLO Fund Ltd. v. Bank of Am., NA, 709 F.3d 1072, 1077 (11th Cir. 

2013) (citations omitted).

II. Default-Rate Interest

A. The Permissibility of Demanding Default-Rate Interest Under the 

Bankruptcy Code

Sagamore argues that even if appellants preserved their claim to default-rate 

interest, bankruptcy law does not allow a creditor to demand default-rate interest as 

a condition to reinstating the original terms of the loan. In support, Sagamore 

relies primarily on opinions issued by our sister circuits and other courts prior to 

the 1994 amendments to the Bankruptcy Code, and the corresponding legislative 

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history for those amendments. Appellants respond that the 1994 amendments to 

the Bankruptcy Code entitle them to default-rate interest. 

The Bankruptcy Code provides that, “[n]otwithstanding any otherwise 

applicable nonbankruptcy law, a plan shall . . . provide adequate means for the 

plan's implementation, such as . . . curing or waiving of any default.” 11 U.S.C. 

§ 1123(a)(5)(G) (2012). Before 1994 “[t]he Code d[id] not define ‘cure,’” so 

courts typically looked for guidance to § 1124’s discussion of what constitutes an 

impaired claim. In re Entz-White Lumber & Supply, Inc., 850 F.2d 1338, 1340 

(9th Cir. 1988); 11 U.S.C. § 1124. Because that section was read as allowing a 

debtor, upon cure of default, to bypass contractual provisions extending additional

relief to a creditor in the event of a default, some courts held that a debtor’s cure of 

its default returned the parties to the “status quo ante,” meaning that creditors lost 

any contractual right to recover default-rate interest. See, e.g., id. and In re 

Madison Hotel Assocs., 749 F.2d 410 (7th Cir. 1984).

But in 1994, Congress enacted amendments to the Bankruptcy Code that, 

among other things, provided the previously missing definition of “cure.” See 11 

U.S.C. § 1123(d). In pertinent part, § 1123(d) states that, “[n]otwithstanding

subsection (a) of this section . . . if it is proposed in a plan to cure a default the 

amount necessary to cure the default shall be determined in accordance with the 

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underlying agreement and applicable nonbankruptcy law.” Given this 

“straightforward statutory command” in § 1123(d), “there is no reason to resort to 

legislative history.” United States v. Gonzales, 520 U.S. 1, 6 (1997). Therefore, we 

read the current iteration of the Bankruptcy Code to require a debtor to cure its 

default in accordance with the underlying contract or agreement, so long as that 

document complies with relevant nonbankruptcy law. See In re Southland Corp., 

160 F.3d 1054, 1059 n.6 (5th Cir. 1998) (“Congress, in bankruptcy amendments 

enacted in 1994, arguably rejected the Entz-White denial of contractual default 

interest rates”); but see Sylmar, 314 F.3d 1070, 1075 (9th Cir. 2002) (holding that, 

with respect to 11 U.S.C. § 1129(a)(3), Entz-White remains good law). 

Accordingly, where, as here, “the underlying agreement” calls for default-rate 

interest and the “applicable nonbankruptcy law” permits it, a party cannot cure its 

default without paying the agreed-upon default-rate interest. Stated another way, 

because Sagamore’s loan documents require the payment of default-rate interest 

and those provisions comply with Florida law, Sagamore must pay default-rate 

interest to cure its default. See In re Sundale, Ltd., 410 B.R. 101, 105 (Bankr. S.D. 

Fla. 2009) (collecting state cases for the point that Florida law allows a lender to 

charge default-rate interest).

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We recognize that the requirements for reinstating the original terms of a 

loan under § 1123 may appear to be in some tension with the framework for 

determining when parties have the right to vote on a debtor’s reorganization plan. 

Under the bankruptcy code, all “impaired” creditors, as a general matter, have a 

right to indicate whether they wish to accept or reject a reorganization plan, but a 

creditor whose claim is not “impaired” is “conclusively presumed to have accepted 

the plan.” 11 U.S.C. § 1126 (2012). Section 1124 describes two ways for a 

creditor’s claim to be unimpaired: (1) if the proposed plan does not alter the legal 

rights of the claim, or (2) if, “notwithstanding any contractual provision or 

applicable law” allowing for default-rate interest, the plan “cures [the] default” 

(and fulfills certain other conditions not relevant here). Thus, under § 1124, any 

outstanding default-rate interest is ignored when determining whether a claim to a 

loan is impaired, but, as explained above, under § 1123, outstanding default-rate 

interest, if called for in the underlying agreement, precludes reinstating the original 

terms of the loan. “[T]his tension [merely] demonstrates that the Bankruptcy Code 

does not precisely equate curing a default [for the purposes of reinstating a loan] 

with unimpairment of a claim.” In re Moody Nat’l SHS Hous. H, LLC, 426 B.R. 

667, 676 n.5. (Bankr. S.D. Tex. 2010). It does not allow us to ignore the clear 

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mandate of § 1123 that allows a creditor to demand default-rate interest as a 

condition for reinstating the loan.

B. Waiver

Appellants contend that the bankruptcy court clearly erred in its factual 

finding that they chose late fees over default-rate interest. They also argue for 

default-rate interest based on state and federal law. Sagamore responds that the 

courts below properly found that appellants legally could, and actually did, choose 

late fees over default-rate interest.

We agree that appellants are entitled to default-rate interest. The bankruptcy 

court’s contrary conclusion was based on two clearly erroneous findings. The first 

was its finding that appellants’ claim for default interest “first surfaced . . . in 

February 2012.” Bankruptcy Op. at 13. 1

 This finding is contradicted by the 

record. JPMCC’s Second Amended Complaint, filed in the foreclosure proceeding 

in November of 2010, demanded “default interest[,]” and Sagamore’s answer

directly addressed this demand by declaring that “default interest should be 

negated.”

The bankruptcy court also clearly erred in finding that appellants

“consistently assessed late fees and not default interest” throughout 2010 and 2011. 

 1 Sagamore continues to maintain this is true. See Resp. Br. at 26.

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Bankruptcy Op. at 13–14. The bankruptcy court relied on databases from LNR, 

the special servicer of the loan, and Berkadia, the master servicer of the loan, that 

only included late fees and not default-rate interest. Id. Though these programs 

automatically assessed late fees and not default-rate interest, the bankruptcy court 

found it significant that appellants never manually inputted the default-rate interest. 

Id. at 14–15. These databases, however, were internal documents—Sagamore only 

obtained them through litigation discovery. As Sagamore conceded at oral 

argument, appellants never actually sent a single document to Sagamore (other 

than through discovery) that demanded late fees while omitting a claim to defaultrate interest. 2

 It was clearly erroneous for the Bankruptcy Court to find that 

appellants’ failure to manually update a database it believed would never see the 

light of day was a meaningful waiver. 

The record clearly demonstrates that appellants first demanded both defaultrate interest and late fees and later withdrew the claim to late fees. The November,

2010 Second Amended Complaint and February, 2012 Proof of Claim demanded 

both default-rate interest and late fees. After Sagamore objected that appellants

 2 We understand Sagamore’s concession at oral argument as a tacit retraction of the

statement in its brief that “[t]he foreclosure complaint filed by JPMCC . . . charged and sought to 

collect late fees but did not charge or seek to collect default rate interest,” Resp. Br. at 21. 

Regardless, the foreclosure complaint did, in fact, demand “default interest.”

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could not receive both default-rate interest and late fees, appellants expressly and 

clearly waived their claim to all late fees “for any time period for which the Court 

allows default rate interest.”

Further, under Florida law the claims for default-rate interest and late fees 

are consistent remedies because they are predicated upon the single factual 

assumption that Sagamore defaulted on its loan. “Under Florida law, all consistent 

remedies may in general be pursued concurrently even to final adjudication,” so 

long as a party does not receive “satisfaction of the claim by one remedy.” 

Princeton Homes, Inc. v. Virone, 612 F.3d 1324, 1334 n.6 (11th Cir. 2010)

(citations omitted). In November of 2012, when appellants waived their claim to 

late fees, none of their claims had been finally adjudicated.

The district court seems to have attached significance to the fact that JPMCC 

paid late fees. See Op. at 318. Yet, appellants note that they only accepted this 

payment under protest. See Appellants’ Br. at 48. Sagamore does not dispute this. 

Payment accepted under protest cannot be the basis of a waiver. See Klein v. 

Grynberg, 44 F.3d 1497, 1502–03 (10th Cir. 1995).

Given the above facts, appellants are entitled to default-rate interest. 

Because appellants have properly preserved their claim to default-rate interest and 

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have waived any claim to late fees, we need not, and do not, address whether a 

creditor could ever demand both default-rate interest and late fees.

C. The Sufficiency of the Notice of Default

In its cross-appeal, Sagamore argues that the bankruptcy court was correct to 

conclude that appellants are precluded from recovering default-rate interest

because they did not send a copy of the September, 2009 letter to Sagamore’s New 

York counsel. Appellants respond that the district court properly found that the 

faulty notice of default was legally irrelevant, because no notice of default was 

required.

We agree with the district court. The Agreement does not require that 

Sagamore provide any notice of default and “expressly waives” any notice not 

explicitly called for by the Agreement or applicable law. Moreover, the letter of 

September, 2009 expressly stated that it did not “constitute[] a waiver, 

modification, relinquishment or forbearance by [JPMCC] of any right or remedy 

under the Loan Documents.”

D. Equitable Mootness

Sagamore argues that we cannot review the confirmation plan because it is 

equitably moot. According to Sagamore, the plan has been substantially 

consummated and it would be nearly impossible to change the plan at this stage. 

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Appellants respond that relief is available because Taplin has sufficient funds and 

because the amended plan already allows for default-rate interest.

Equitable mootness applies when “effective relief is no longer available.” In 

re Club Assocs., 956 F.2d 1065, 1069 (11th Cir. 1992) (citations omitted). 

Requiring Sagamore to pay default-rate interest is effective relief. Indeed, it does 

not even require revising Sagamore’s amended plan, which already provides for 

“funds required to reinstate the indebtedness, whatever that amount is, as 

determined by the Court, and on the terms and conditions imposed by the Court.”

III. The Feasibility of Sagamore’s Plan

The bankruptcy court found that Sagamore’s proposed plan had a reasonable 

prospect of success based on Taplin’s claim that he could refinance and make up 

any difference personally. The district court affirmed. Appellants contend that the 

courts below erred in finding that Sagamore’s reorganization plan meets the 

requirements of 11 U.S.C. § 1129(a)(11) (2012). According to appellants, the plan 

is “likely to be followed by the liquidation, or the need for further financial 

reorganization, of the debtor or any successor to the debtor under the plan, [and] 

such liquidation or reorganization is [not] proposed in the plan,” id. Sagamore 

argues that the bankruptcy court properly found it reasonably likely that no further 

financial reorganization or liquidation would be necessary.

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We agree with the courts below. Appellants do not show any error, let alone 

clear error, in the bankruptcy court’s factual finding that Taplin could refinance or 

personally pay any outstanding debts. Accordingly, the plan is not reasonably 

likely to require liquidation or further financial reorganization and meets the 

requirements of § 1129. 

IV. Issues Unaddressed by the District Court

Appellants ask us to find that they are entitled to fees and costs incurred 

prior to and in connection with Sagamore’s bankruptcy. They also ask us to rule 

that the default-rate interest is due immediately. Sagamore argues that the district 

court’s remand on the question of fees and costs is not final and not appealable. It 

does not address the issue of when any default-rate interest may be due.

The issue of what fees and costs, outside of this appeal, are due to appellants

and the issue of when any default-rate interest is due were not addressed by the 

district court and will not be addressed by this Court in the first instance. These 

issues should be addressed by the district court on remand.

CONCLUSION

For the foregoing reasons, the district court’s decision affirming the 

bankruptcy court’s denial of default-rate interest is reversed; the district court’s 

decision that Sagamore’s reorganization plan is feasible is affirmed; and the 

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questions of costs and fees as they relate to Sagamore’s bankruptcy and the timing 

of payment of the default-rate interest are remanded. AFFIRMED-IN-PART,

REVERSED-IN-PART AND REMANDED.

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