In Stonehill Capital Management v. Bank of the West , 28 NY3d 439 (2016), the New York Court of Appeals held that an agreement to sell a distressed loan, in the auction loan trading market, was enforceable without the execution of a formal written contract. While Stonehill may simply reflect the court’s pragmatic acknowledgement of the trading practices that prevail in fast-paced loan trading, there has been concern expressed by some real estate attorneys that the decision may adversely impact longstanding practices in the negotiation of real estate contracts. The authors of this article do not share that concern, but we do believe that the decision does highlight points that real estate attorneys should consider when advising their clients. This article discusses when emails will be deemed a real estate contract and how to prevent or create such a binding contract.
Adam Leitman Bailey and John M. Desiderio