In The News

Sean Kirk will Discuss the Impact of the Greenbank Decision in CLE Webinar, June 26

Bone McAllester Norton’s Sean C. Kirk will lead a webinar with Business and Legal Resources on Wednesday, June 26. The webinar, “Impact of the Greenbank Decision: Challenges to Foreclosure Sales in Tennessee,” will take place from 2 to 3 p.m. and will discuss a landmark case that interpreted what “materially less” means in foreclosure sales.

The agenda includes:

  • Background of Greenbank: Legislative change

  • Facts of the case: Foreclosure bid price of 89% of the highest appraisal

  • Holding the court: What is the “materially less” standard?

  • Impact of the court’s decision: What should lenders do?


This webcast will count for one hour of CLE.

Bone McAllester Norton PLLC is a full-service law firm with 33 attorneys and offices in Nashville and Sumner County, Tennessee. Our attorneys focus on 16 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.

Bonelaw Attorneys Involved in Court Decision of “Materially Less” in Foreclosure Sales

Tennessee Court of Appeals Issues First Opinion Examining Tennessee Deficiency Judgment Statute
Background:  In the wake of the real estate market collapse, the Tennessee legislature passed, effective September 1, 2010, a statute dealing with deficiency judgment on real property after a trustee’s or foreclosure sale. The statute created a rebuttable presumption that the amount bid at a foreclosure sale equal the fair market value of the property. Debtors could overcome this presumption by showing that the bid was “materially less” than the fair market value.

Case:  Bone McAllester Norton PLLC attorneys David Anthony, Sean Kirk and Tucker Herndon represented the Lender who filed suit to obtain a judgment for the deficiency against the Borrower and Guarantors ( the “Defendants”) after completion of foreclosure against the real property collateral. The Defendants contested the foreclosure sale price as being materially less than fair market value. On a motion for summary judgment filed by the Lender,  the Trial Court and Tennessee Court of Appeals examined the deficiency statute and decided what “materially less” means.  The phrase “materially less” had never been used in any other Tennessee statute or court opinion.

The Lender purchased its own collateral at foreclosure for a mid-range bid based upon a current appraisal. Based upon an Affidavit, the debtor asserted that the fair market value of the property was greater. On Motion for Summary Judgment, the Trial Court held in favor of the Lender that a sales price of 89% - 91% of the recent appraisal was not “materially less.”

On appeal, the Tennessee Court of Appeals agreed with the Bone McAllester Norton PLLC attorneys, affirming the Trial Court decision on summary judgment, finding that the foreclosure bid price of 89% of the highest appraisal was not “materially less” and finding that the debtor had failed to raise sufficient facts to present a defense to summary judgment and the deficiency lawsuit.  The Court did not set a bright line percentage above or below which the statutory presumption is rebutted.

Lenders are well advised to continue the practice of obtaining current appraisals prior to foreclosure and base the foreclosure bid price on the current appraisals, taking into account costs of foreclosure and costs of owning the property.

David Anthony Explains “Materially Less” in Foreclosure Auctions to Nashville Post

Bone McAllester Norton attorney David Anthony shed some light on what constitutes “materially less” in foreclosure auctions in a December 14 Nashville Post article. This clarification gives banks the backing they might need in court.

Read more about this explanation here.

David Anthony Explains “Materially Less” in Foreclosure Auctions to Nashville Post

Bone McAllester Norton attorney David Anthony shed some light on what constitutes “materially less” in foreclosure auctions in a December 14 Nashville Post article. This clarification gives banks the backing they might need in court.

Read more about this explanation here.