In Fordyce Bank and Trust v. Bean Timberland, the bank lent Bean money to buy timber from landowners. Bean gave the bank security interests in the timber, which he sold to lumber companies that milled the logs into lumber. When Bean defaulted on the loan, the bank tried to collect from the lumber companies because it had a secured interest in the timber. The courts held that:
a. since there was abundant evidence that purchasing gatewood without performing a lien search was the standard practice in the timber industry, the timber companies had no duty to perform a lien search and so there was no breach of duty
b. since there no evidence that purchasing gatewood without performing a lien search was the standard practice in the timber industry, the timber companies had a duty to perform a lien search and so there was a breach of duty
c. without more evidence, the court could not decide whether purchasing gatewood without performing a lien search was the standard practice in the timber industry
d. the case should be dismissed because neither side could present sufficient evidence regarding whether purchasing gatewood without performing a lien search was the standard practice in the timber industry
e. none of the other choices are correct
Quick Reply
