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socrateaser, Lawyer
Category: Legal
Satisfied Customers: 39027
Experience:  Retired (mostly)
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What rule, statute, regulation etc is violated (if any) when

Customer Question

What rule, statute, regulation etc is violated (if any) when an officer of the bank used by both seller and buyer of a business while negotiating the terms of purchase for the business, assists one party to the detriment of another, with both honest and false information being provided to the party(ies) by said bank officer.
Submitted: 3 years ago.
Category: Legal
Expert:  socrateaser replied 3 years ago.
The only rule potentially violated would be a breach of fiduciary, owed by an agent to a principal/client. An agent cannot represent parties on both sides of a transaction (except for real estate agents, who are expressly exempt from the common law of agency under the law of every U.S. jurisdiction, including Tenn.).

The problem with the theory is that an injured party would have to show that the bank officer was impliedly acting in an agency capacity for both parties to the transaction -- or, alternatively, that the officer was acting on behalf of the adverse party while his/her conduct indicated that he/she was acting on behalf of the injured party, or only on behalf of the bank.

The law of agency provides that an agency relationship can be created expressly, via an oral or written contract; impliedly via the actual conduct between parties (termed, "actual authority"); via a manifestation of the principal to third parties (termed, "apparent authority"), or via operation of law (termed "ostensible authority") -- such as where a parent acts to bind a minor child to a particular activity, to which the child could not bind his/herself.

Also, an agent can create a warranty of agency authority, even if no actual, apparent or ostensible authority exists, by manifesting agency authority to a third party -- and thereby the agent becomes liable for the promises made, even if the agent's principal/client never authorized the agent's actions.

Anyway, that's the broad stroke. If you want to hold the bank officer liable, you will have to show that he/she misrepresented his/her actions so as to induce your justifiable reliance, and that as a result, you suffered some sort of definite and certain injury and consequent economic damage.

Please let me know if my answer is helpful, and if I can provide further assistance.

And, thanks for using!
Customer: replied 3 years ago.
That's helpful but need follow up after you add following facts: Ok to assume bank officer aided other to my detriment, plus my Account Rep resigned when new guy (former Rep of other bank client) replaced her as my Rep which i never spoke to, received call from or any contact. he supplied letter to buyer that allowed him to get out of locked contract. then i agreed new terms only to have buyer not pay me but start competing biz with my employees and some property in same tow Plus,had multi-million dollar loss when bank without cause or notice, froze all assets and placed line of credit $250 debt immediately past due, attempted to seize collateralized assets of $13mill inventory. To stop that I put biz into Reorg and became Debtor in Possession paying $20k monthly. But bank still pursued by then filing against me personally (I consigned personally with company) and forced me into Chapter 7 after refusing full pay off from associate who the banks counsel convinced o withdraw offer to pay off all debt. Then bank seized with simple letter and cooperation of auction house where I had moved four-million of inventory to be auctioned in order to pay debt. But bank cut me out and auction failed to describe signed books as signed, sold in bulk (20at a time) when they and I had agreed to do two max per auction and pic of each autograph. Then my attorney withdrew, I'm pro sea and never received any info as to result of auction sales or anything else....not a single other piece of mail or call. Discharged two years ago with no other creditors complaining or showing up at debtors conference.
Expert:  socrateaser replied 3 years ago.
The core issue appears to be the "letter" that permitted the buyer to cancel a locked contract. Not knowing what either the contract or the letter stated, I can't comment intelligently on the bank officer's representations or their legal effect.

Additionally, there seems to be a long chain of subsequent events, any one of which could cut off your rights against the bank -- because wherever a court order is made, it may operate to collaterally estop the parties from suing on issues that were already tried, or which could have been tried in a previous action.

My educated guess is that you are probably SOL. But, again, without reviewing your contract and the letter, I'm just guessing.

I wish I could offer more, here -- but, your information has quickly gone from very straighforward to unbelievably complex.

Hope this helps.
Customer: replied 3 years ago.
It is complex agreed. But, I'm looking for the exact location, by citation, of the law that governs banks and issues like mine. Cases would not be helpful unless they have further defined the laws. In addition to statutes, are there "rules" applied to banks by the US Congress? I was worth $15mil+ until this Billionaire wanted and was going to buy it from me. But he kept changing the terms. First change I agreed, second change I said no. That's when bank came against me. Billionaire now has my employees, vendors, etc and I went to bankruptcy to keep bank away from my assets but eventually lost most of those too. What I need is a good lawyer on contingency and haven't found one. Can you help with that too? I was thinking about taking my case to the US Senate Banking Committee. I worked for Congress thirty years ago, in my 20s.
Expert:  socrateaser replied 3 years ago.
I will reopen your question to others for further comment. Please don't reply to this note. It will slow down getting someone else involved. If no one engages with you during the next 24 hours, then I suggest that you withdraw the question entirely, and open a new question on the same subject, so that other contributors will see the question as new.

Best of luck with your search.
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