• Blog Post,  Uncategorized

    North Carolina Business Court Recognizes New Duty to Negotiate in Good Faith

    While North Carolina has never recognized a fiduciary relationship between lenders and borrowers, in June the North Carolina Business Court did recognized a new cause of action: breach of a duty to negotiate in good faith.[1]    The Court confined its decision to the particular facts present in the case, leaving many questions unanswered regarding this type of claim.   BB&T gave two loans totaling $5.275 million to an experienced real-estate developer.  BB&T and the client had a long (30 year) borrower-lender relationship, which the Court characterized as “multifaceted and unique.”[2]  The loans needed restructuring, so BB&T and the borrower spent over eight (8) months extensively negotiating their terms.  The negotiations…