Creditors Practice Section

This section was created for attorneys who are in the creditors practice field. It provides its members the opportunity to exchange information with other practitioners in this area of practice, provides timely CLE and legislative updates.

Chair
Attorney at Law
1275 Habersham Way
Franklin, TN 37067
(615)403-6556
Immediate Past Chair
Cheadle Law
2404 Crestmoor Road
Nashville, TN 37215
(615)254-1009
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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Creditors Practice Annual Forum 2017

Make plans to join us for this year's exciting forum. The TBA's Creditors Practice Section offers current developments in this area of the law. This year's program will provide new information on creditors practice in estate claims and an update on the Telephone Consumer Protection Act. Other topics include a crash course in bankruptcy and an ethics session about the Consumer Financial Protection Bureau. Click here to sign up today.

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