01/27/2012 11:56:00 AM EST
Do Bankers Ever Have Fiduciary Duties To Their Customers?
If a bartender serves a visibly intoxicated customer with
even more alcohol and the customer then causes an accident while driving drunk,
the bartender can be liable under North Carolina's Dram Shop Act, N.C. Gen.
Stat §18B-120, et seq. But if a banker showers cash on a borrower to fund
a deal which goes bad, does the borrower have any claim against the
banker for not cutting him off?
The short answer is that bartenders are held to a
higher standard than bankers. A claim against a lending bank for anything
other than a violation of the terms of the loan documents -- say such as a
claim for breach of fiduciary duty -- is almost always doomed to
dismissal Judge Gale of the Business Court last week did exactly that to
the borrower's claim in Wells
Fargo Bank, N.A. v. Vandorn, 2012 NCBC 6, saying that "[I]n an ordinary
lender-borrower relationship, the lender does not owe any duty to its borrower
beyond the terms of the loan agreement[,]" Op. ¶__. (quoting Branch
Banking & Trust Co. v. Thompson, 107 N.C. App. 53, 418 S.E.2d 694,
Wells Fargo had sued Vandorn, Cook and an LLC formed by
the two individuals to collect on a defaulted loan made for the LLC to
buy a lot in a high-end resort development called Laurelmor. Laurelmor
was billed as a 6,000 acre golf resort, with the course designed by PGA great
Tom Kite, to be developed in the North Carolina mountains. The
Winston-Salem Journal says that Laurelmor "collapsed
under the bad economy and a massive loan."
Read this article in
its entirety on North
Carolina Business Litigation Report, a blog for lawyers focusing on issues
of North Carolina business law and the day-to-day practice of business
litigation in North Carolina courts.
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