Court Decides Issue of First Impression for Lenders

Writing for the Alabama Supreme Court on an issue of first impression, Justice See held in Flying J Fish Farm et al. v. Peoples Bank of Greensboro, No. 1061833 (Ala. Oct. 24, 2008), that a lender does not owe a no duty to its borrower to make certain that the project in which the borrower invests is sufficiently feasible to allow repayment of the loan.  Lenders are not insurers of borrowers’ business decisions.  The issue was brought to the Court through a question that the trial court certified for permissive appeal from an order in which the trial court denied the defendants’ motion for summary judgment.