Lender Best Practices In Light Of 'Confess Judgment' Risks

Law360, New York (October 16, 2013, 6:37 PM EDT) -- A warrant of attorney to confess judgment, or a cognovit clause, in a lease, mortgage or other loan document is a powerful remedy available to lenders when a commercial lessee or borrower defaults on its obligations. It is so powerful, in fact, that the Pennsylvania Supreme Court has likened the effect of a warrant of attorney on the lessee/borrower to "a warrior of old entering a combat by discarding his shield and breaking his sword."

Essentially, a warrant of attorney to confess judgment permits a creditor's...
To view the full article, register now.