Denver Law Review Volume 67 Issue 3 Article 5 February 2021 Stemming the Tide of Lender Liability: Judicial and Legislative Reactions William N. Medlock Follow this and additional works at: https://digitalcommons.du.edu/dlr Recommended Citation William N. Medlock, Stemming the Tide of Lender Liability: Judicial and Legislative Reactions, 67 Denv. U. L. Rev. 453 (1990). This Note is brought to you for free and open access by the Denver Law Review at Digital Commons @ DU. It has been accepted for inclusion in Denver Law Review by an authorized editor of Digital Commons @ DU. For more information, please contact
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[email protected]. STEMMING THE TIDE OF LENDER LIABILITY: JUDICIAL AND LEGISLATIVE REACTIONS I. NAVIGATING THE WATERS OF LENDER LIABILITY Banks and lending institutions have recently found themselves en- gulfed in a wave of lender liability actions. Troubled borrowers have successfully turned to the doctrine of lender liability to assert their legal rights. Fraud,' breach of the implied obligation of good faith and fair dealing,2 breach of the fiduciary duty,3 liability for excessive control re- 1. See Richfield Bank & Trust Co. v. Sjogren, 309 Minn. 362, 244 N.W.2d 648 (1976) (Banks have a moral duty to the community in which they do business, and a bank which had actual knowledge of the fraudulent activities of one of its depositors was under an affirmative duty to disclose this knowledge before making a loan in furtherance of the fraud.); Farah Mfg. v. State Nat'l Bank, 678 S.W.2d 661 (Tex. Ct.