Bankruptcy Law Section

The Bankruptcy Law Section focuses on issues involving bankruptcy law. The section’s executive committee develops projects for its members ranging from legislative proposals to their annual two-day Bankruptcy Forum and associated social events.

Chair
Wilson & Assoc PLLC
5050 Poplar Ave., Suite 115
Memphis, TN 38157
(901)578-9914
Immediate Past Chair
Scarborough & Fulton
620 Lindsay Street, Suite 240
Chattanooga, TN 37403
(423)648-1880
Staff Coordinator
Tennessee Bar Association
221 4th Avenue N. Suite 400
Nashville, TN 37219
(615)383-7421

Court Clarifies Law When Bank Sells Loan Collateral Without Proper Notice

The Tennessee Supreme Court today issued guidance on the steps courts should follow when a creditor sells collateral used to obtain a loan, but does not provide the required notice of the sale. The case involved a bank loan that was used to purchase an airplane, with the plane itself and additional guarantors securing the transaction. When the debtor failed to maintain insurance, the bank, Regions Bank, placed the loan in default, and the resulting accelerated payments were not made. The bank filed suit against the guarantors. While that action was pending, Regions also repossessed the plane and spent money to make it flightworthy and marketable. Regions then ultimately sold the plane at a private sale for less than the amount owed to Regions. The Court concluded that resolution of this issue was a fact question for the trier of fact, in this case the trial court, to decide. The court expressly rejected the Court of Appeals’ evidentiary requirement regarding proof negating a debtor’s or guarantor’s ability or motivation to redeem or purchase the collateral. The court then spelled out the proper procedures for a trial court to utilize to resolve this issue.

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Free Legal Advice Clinic in Maryville

Volunteer attorneys from the Blount County Bar Association will join staff attorneys from Legal Aid of East Tennessee to provide free advice on various legal matters. The public will be able to seek advice on topics such as adoption, child custody and support, divorce, elder law, foreclosure, identity theft, personal injury, VA benefits, wills, worker’s comp, and more.  Legal help will be available on a first come, first served basis. The clinic is open to the public. No appointment is necessary. The Advice Clinic is part of LAET’s Pro Bono Project, and is offered in celebration of Pro Bono Month. The event is Oct. 14 from 9 a.m. to 12 p.m.
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