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Lender Liability: Evaluating, Minimizing and Defending Claims

Defending Against Attacks on Loans in Workout, Default and Bankruptcy

Recording of a 90-minute CLE webinar/teleconference with Q&A

Conducted on Tuesday, March 16, 2010
Recorded event now available

This CLE webinar will offer guidance for counsel to lenders who are facing lender liability claims and lawsuits in record numbers. The panel will analyze the most common types of claims, discuss how they are arising at various stages of the lending cycle and in bankruptcies, and offer best practices for avoiding claims.

Description

With record numbers of loan defaults, foreclosures and corporate bankruptcy filings, borrowers are increasingly filing lawsuits as "preemptive strikes" to forestall foreclosure or loan default. Many times these suits appear as counterclaims to legal action filed by lenders.

Many lender liability problems arise in connection with a lender's conduct or statements made in the course of efforts to restructure or work out a problem loan. Borrowers and guarantors are asserting lender liability claims in an effort to increase leverage in workout negotiations.

Bankruptcy trustees and unsecured creditors are becoming more aggressive in alleging lender liability issues to increase recovery for unsecured creditors in bankruptcy cases. Lenders' and borrowers' counsel must understand claims and defenses from both sides to protect their client's interests.

Listen as our authoritative panel of legal specialists reviews various theories of lender liability and offers best practices to conduct loan workouts and exercise default remedies to minimize lender liability claims.

Outline

Contractual Liability
1. Covenant of good faith and fair dealing
2. Credit agreements
  1. Demand notes
  2. Insecurity, MAC and MAE, force majeure clauses
  3. Acceleration clauses
  4. Discretionary advance clauses
3. Construction loan agreements
4. Damages
Tort Theories of Liability
1. Fraud and misrepresentation
2. Economic duress
3. Intentional interference with contractual relations
4. Breach of fiduciary duty
5. Negligence loan processing
6. Instrumentality theory
7. Duty to other lenders
8. Damages
Best Practices to Minimize Lender Liability Claims
1. Retracting existing financing
2. Loan workouts
3. Foreclosures
4. Bankruptcy considerations
5. Multi-lender considerations

Benefits

The panel will review these and other key questions:

What are the most common mistakes lenders make in loan workouts that can lead to lender liability claims?
What theories of lender liability are commonly asserted by junior or participating lenders against senior lenders?
How are lender liability claims being asserted in bankruptcy—and what steps can lenders take to survive a challenge in bankruptcy?

Faculty

W. Mike Baggett, Chairman Emeritus
Winstead, Dallas

He is a highly respected leader in the Texas legal and business communities. He has successfully argued six published opinions of the Texas Supreme Court and has tried over 50 commercial cases at the trial level. He is a well-known author and lecturer before judicial conferences, bar associations, law schools, trade and industry groups.

Steven I. Fried, Principal
Capital Finance, Indian Wells, Calif.

He is sole owner of Capital Finance, a commercial finance and financial consulting concern established in 1987 that provides expert witness testimony, litigation support and consulting services to the banking, business, financial and legal communities. He represents commercial borrowers on obtaining new financing and restructuring of existing debt. He has more than 30 years of banking experience.

Mark J. Kalla, Partner
Dorsey & Whitney, Minneapolis

He is a Partner in the Finance and Restructuring Department focusing on bankruptcy and workout matters, corporate bond defaults, and representation of various entities in commercial disputes, as well as the documentation of asset-based loans including debtor-in-possession financing.

Ordering

Online CLE

Includes audio streaming of full program plus handouts (available 24 hours after live seminar).

CLE: Pre-approved for participatory or non-traditional/alternate format credit in: CA, HI*, NY*, WV*. Pre-approved for self-study credit in: AK, AZ, MO, MT, TX, UT, VT, WA.
Upon request, also available in: CO, CT*, FL, GA, ID, KY, LA, ME, NC, ND, NE, NH, NM, NV, OR*, SC, TN, WI*, WY. If you are applying for credit in one of these states, make sure to select those states when placing your order.
(*Indicates that Strafford must report attendance.)

Online CLE Audio $297.00
Available 24 hours after the live event

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Recorded Event

Includes full event recording plus handouts (available after live seminar).

CLE: Pre-approved for self-study credit in: AK, AZ, CA, CT, HI, MO, MT, NY, TX, UT, VT, WA, WV. Upon request, self-study credit is also available in: CO, FL, GA, ID, KY, ME, ND, NE, NH, NM, NV, OR, WI, WY. If you are applying for self-study credit in one of these states, contact Strafford CLE at 1-800-926-7926 ext. 35 or CLE@straffordpub.com.

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Available three business days after the live event

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CD (Audio with Slide PDFs) $297.00 plus $9.45 S&H
Available ten business days after the live event

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Available ten business days after the live event

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