The borrowing relationship of debtor and creditors is at the heart of the American economy, and therefore the subject of many lawsuits. In the case of Atlantic Stewardship Bank v. Puddingstone Funding, LLC, (2013 WL 5777539) the New Jersey’s Appellate Division held that the amount of the outstanding debt the defendants were required to re-pay should not have a “fair market value credit” applied to it.
Plaintiff Atlantic Stewardship Bank sought to collect on a $2.5 million note that matured on July 1, 2009 and it also alleged defendants had defaulted on their loan obligations by failing to make two monthly payments in June and July 2009. Defendants Puddingstone Funding, LLC, et al. rebutted by stating, among other things, that plaintiff had acted in bad faith by not allowing Puddingstone to liquidate collateral to satisfy the debt, reneged on a verbal agreement to lower the interest rate on the loan, and disseminated defendants’ private financial information. Continue reading →