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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Real Property - Finance

Date & Time
  • event Date

    Thursday, June 29, 2023

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

$347.00
CLE
ALL

This CLE webinar will analyze the most common types of lender liability claims, discuss how they are being asserted in various phases of the lending cycle, and explain lessons learned from recent financial litigation. The panel will outline best practices to minimize and avoid the risk of lender liability claims.

Faculty

Jason E. Goldstein
Shareholder, Co-Chair Mortgage Banking Group
Buchalter

Mr. Goldstein specializes in resolving complex business disputes for a diverse cross-section of clients, ranging from national banks to insureds, private money lenders, credit unions, individuals, loan servicers, landowners, pharmaceutical companies, vaping companies, equipment finance companies, brokers and investors. He is Co-Chair of the firm’s Mortgage Banking Group, a fellow of the American College of Mortgage Attorneys (ACMA) and a member of the ACMA Title Insurance Committee. Mr. Goldstein has an extensive legal background in state and federal courts across the country, which includes business litigation, real property related litigation, “private money,” title insurance claims and litigation (as well as CGL, D&O, etc.), escrow claims and litigation and misappropriation of trade secrets litigation. He also handles litigation involving wrongful foreclosure, lender liability defense, leases (commercial, residential and equipment), general contractors, receiverships and judicial foreclosures.

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John L. Hosack
Shareholder
Buchalter

Mr. Hosack focuses his transactional practice on commercial real property loan documentation, loan workouts, REO sales and foreclosures. He represents secured lenders and property owners at trial and on appeal in complex real property disputes, including lender liability, fraud, class actions, breaches of contract, wrongful foreclosures, mechanic’s liens, stop notices, judicial foreclosures, receiverships, escrow claims and title insurance claims.

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Joffrey G. Long
Private Money Lender
Miscellaneous

Mr. Long has been active as a private money lender for more than 41 years. He has also been qualified by numerous courts and testifies frequently as an expert witness in private money lending and related matters. His company makes, (as a lender) arranges, (as a broker), and acts as a loan servicer for real estate loans. Mr. Long is the Past President and Education Chair of the California Mortgage Association, the California trade association for private money lenders, brokers, and loan servicers.

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Description

Lender liability issues can arise at any stage in the loan cycle. Breach of contract claims may arise from lenders' refusal to advance funds, failure to provide new financing, or alleged breach of loan commitments. Tort claims range from constructive fraud based on fiduciary duty to duress or tortious interference.

Loan documentation should be drafted in anticipation of potential lender liability claims, with jury waiver, arbitration, statute of limitations, damages limitations, and attorneys' fees language satisfactory to the lender. In administering a loan, all communications and demands of the borrower and guarantor should be clearly expressed in writing and made in compliance with loan documents. In a default scenario, the lender should avoid the appearance of improper control over the borrower and avoid becoming a mortgagee in possession through the appointment of a receiver.

Listen as our authoritative panel of practitioners reviews various theories of lender liability, including a litigator's perspective on these cases. The panel will offer best practices for handling loan origination and administration, as well as workouts, modifications, and defaults while minimizing lender liability claims.

Outline

  1. Phases of the loan cycle where liability may arise
    1. Advertising
    2. Standards of conduct/code of ethics
    3. Underwriting
      1. Predatory lending and loan-to-own
      2. Conflicts of interest
    4. Loan origination
      1. Documentation
      2. Payment structure practices
      3. Know your customer
    5. Syndication/participation
    6. Loan administration
    7. Restructuring of defaulted loans
    8. Foreclosure
    9. Bankruptcy
  2. Theories of lender liability
    1. Breach of contract
    2. Fraud, duress, and misrepresentation
    3. Negligence
    4. Infliction of emotional distress (on an individual borrower)
    5. Violation of statutory duties
    6. Breach of fiduciary duty
    7. Improper control of the borrower
    8. Breach of the covenant of good faith and fair dealing

Benefits

The panel will review these and other key issues:

  • What are the common mistakes lenders make at origination, in loan administration, or in loan workouts that can lead to lender liability claims?
  • What theories of lender liability are most often asserted by borrowers after a loan default?
  • What theories of lender liability are 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?