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Changes to Missouri Statutes Affect Foreclosure, Uniform Commercial Code, Credit Agreements

Three notable pieces of Missouri legislation will become effective August 28, 2013, nullifying foreclosure mediation initiatives in St. Louis City and County, modifying certain provisions of the Missouri Uniform Commercial Code, and altering certain standard language required in all Missouri “credit agreements.”

Foreclosure Mediation:

Missouri House Bill 446, sponsored by Armstrong Teasdale partner Representative John Diehl and Representative Stanley Cox, will become effective August 28, 2013, due to the governor’s failure to veto or sign it. The bill explicitly prevents local municipalities from modifying foreclosure requirements. This will preempt the new foreclosure mediation programs implemented by St. Louis City and St. Louis County, which required mediation and imposed various fees/fines on banks seeking to foreclose.

Uniform Commercial Code 2010 Amendments:

Missouri House Bill 212 was enacted to address confusion regarding the name used for an individual in UCC searches and filings. Courts had both upheld and rejected use of nicknames and shortened names (e.g., Ronnie/Ron). Effective August 28, 2013, Missouri will require that UCC filings be in the name shown on the individual’s driver license (if they have one). Other notable changes include:

  • for companies, in the event of any discrepancy, the name shown on the most recently filed charter document should be used (rather than what may be shown on the Secretary of State’s website or even a certificate of good standing);

  • “correction statements” will now be known as “information statements” and can now be filed by secured parties to address unauthorized filings;

  • information required on financing statements will be simplified (entity type, jurisdiction, and ID number are no longer required); and

  • new forms will be available (http://www.sos.mo.gov/ucc/forms.asp) on August 28, 2013.

Statutory Language for Credit Agreements:

Lastly, the oral statements language required for "credit agreements" under RSMo 432.047 will change slightly due to Missouri Senate Bill No. 100.  As to any loan documents or workout documents that are "credit agreements," the new language should be included after August 28, 2013 (at least 10 point boldface type):

ORAL OR UNEXECUTED AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE, REGARDLESS OF THE LEGAL THEORY UPON WHICH IT IS BASED THAT IS IN ANY WAY RELATED TO THE CREDIT AGREEMENT. TO PROTECT YOU (BORROWER(S)) AND US (CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.

Changes are highlighted below:

ORAL OR UNEXECUTED AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE, REGARDLESS OF THE LEGAL THEORY UPON WHICH IT IS BASED THAT IS IN ANY WAY RELATED TO THE CREDIT AGREEMENT.  TO PROTECT YOU (BORROWER(S)) AND US (CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.

 

 

 

© Copyright 2020 Armstrong Teasdale LLP. All rights reserved National Law Review, Volume III, Number 212

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About this Author

John J. O'Brien, Armstrong Teasdale Law firm, Real Estate Attorney
Partner

John O’Brien counsels clients in connection with all aspects of lending transactions, mergers and acquisitions and general corporate matters.

He devotes his practice principally to the representation of banks and commercial finance companies. He handles lending transactions, including asset-based and cash flow loans, syndicated credit facilities, loan participations, subordinated debt arrangements, mezzanine financings, loan workouts, restructuring and foreclosures.

In addition, John advises clients with respect to buying and selling businesses...

314-552-6626
John L. Sullivan, Armstrong Teasdale Law firm, Financial Institutions Attorney
Partner

Leader of the firm’s Banking and Financial Institutions practice group, John Sullivan directs national and international financial institutions through issues affecting the ever-changing financial services industry. His background in litigation aids him in effectively advising on the structure and documentation of each project.

314-342-8093
Daniel J. Burke, Jr., Real Estate Attorney, Armstrong Teasdale Law firm
Partner

Dan Burke, a member of the Financial and Real Estate Services practice group, counsels clients on matters that include the purchase, sale, leasing, financing and development of real estate. Recognizing that the best result may not always be the most obvious, Dan prides himself in providing actionable, results-oriented advice that goes beyond basic legal analysis.

National and regional companies turn to Dan for guidance in the site selection and project approval process. He has helped obtain planning and zoning approvals for a variety of uses.

 

314-259-4771