Confessed Judgment Set Aside

    The United States District Court at Alexandria, Virginia, set aside a confessed judgment in the case of Benton Land Fund, L.P. v. NvMercure Ltd Partnership because the entry of the judgment was by a party not specifically authorized to confess judgment.  The Court found that the provisions in the note at issue stated that judgment may be confessed by "any attorney admitted to practice in any jurisdiction or any vice president or senior vice president of the bank".  The Court found that this language was not sufficiently specific to allow the plaintiff limited partnership to confess judgment because of certain ambiguities among the documents in identifying the "Bank" referred to in the note.  Further, the language in the note did not entitle the person who actually confessed judgment to act as the attorney-in-fact for that purpose.

This case serves as another reminder as to why competent legal advice should be sought, and why loan documents and contracts should be carefully read and strictly followed.