Little Big Mistakes: The Second Circuit Rules on GM/JP Morgan

Culminating a two-year appeals process, the United States Court of Appeals for the Second Circuit just ruled that the statement filed to terminate a financing statement perfecting a security interest was effective. Yes, the parties intended to terminate a different financing statement, but that doesn't change the outcome under the facts of this dispute (these facts have been the subject of several prior Credit Slips posts; see here and here and here).

Today's per curiam decision cites the Restatement (Third) of Agency for the proposition that "Actual authority . . .  is created by a principal's manifestation to an agent that the agent take action on the principal's behalf."  And, says the panel, that's what happened. Again, full (and fairly brief) opinion is here.

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