The Fall 2020 Meeting of the Working Group on Legal Opinions Foundation (“WGLO”) concluded last October. In past years, the meetings were conducted, in New York, each as an in-person meeting lasting several hours on a single day preceded by small group breakout dinner sessions devoted to substantive opinion-related topics the evening before. Due to COVID-19 considerations, the 2020 Spring Meeting of WGLO was canceled and the 2020 Fall Meeting was conducted as a virtual meeting through Zoom. The Fall 2020 Meeting was conducted over several days on October 20, 2020, October 22, 2020, October 27, 2020 and October 29, 2020 and addressed a variety of topics of interest to the attorneys that issue and review opinion letters.
As a reminder, WGLO is an organization whose mission, per its website is “… to bring together all constituencies concerned with giving and receiving legal opinions in order to foster a national opinion perspective, broaden the consensus that exists and provide a continuing forum for discussion of opinion issues.” There are three categories of members of WGLO: the ABA’s Business Law Section, law firms and bar associations (such as the ABA’s Section of Real Property, Trust and Estate Law and state bar associations). Among WGLO’s activities is the hosting of a Spring meeting and a Fall Meeting each year (although in 2020, as noted above, only the Fall 2020 virtual conference was held). Lawyers that are partners in, or, employed by member law firms may, as of the writing of this article, access written materials from the Fall 2020 conference through the WGLO website (note that a log-in is required to access those materials).
Two programs were presented on October 20. The first program, “Is There a Consensus on Opinion Practice: How Practitioners Are Addressing Current Opinion Issues”, addressed a variety of issues regarding areas of consensus in opinion practice, including discussions of opinion-related issues affected by Dodd-Frank, CFIUS, the Hague Securities Convention and bail-in provisions in documents. One topic dealt with during the first program pertained to third-party reliance on opinion letters such as reliance by assignees, rating agencies and loan participants and discussed limitations on who may rely on opinion letters. This topic will be presented again in a webinar scheduled for January 12, 2021 at 1:00pm ET. The second program, “Takeaway: Another Look at the Use of Representations in Opinion Practice,” addressed the use of representations in opinion practice.
Two programs were also presented on October 22. The first program, “Recent Opinion Developments”, reviewed recent judicial decisions. The decisions are not necessarily decisions related to opinion letters themselves, but, rather addressed substantive legal issues bearing upon opinions. There was not time during the session to cover all of the over 30 decisions that were referenced in the written materials presented in connection with the program. The referenced decisions covered topics such as corporate authority, securities, contract formation, contract interpretation, contract modification, jurisdiction, choice of law, choice of forum, third-party beneficiary, contract claims, risk allocation, secured transactions-UCC, guaranties, and lawyer liability. The second program, “Disclosure in the Context of Opinion Practice”, dealt with disclosures to non-clients in the context of opinion practice and whether opinion givers have disclosure obligations to non-client opinion letter recipients beyond those in the opinion letter itself.
The programming presented on October 27, 2020 began with the presentation of the Fuld Award to Richard Howe, of New York. The Fuld Award, named for James J. Fuld, who wrote the seminal article on opinion practice in 1973, has been awarded annually (except for 2013) by WGLO to an individual or organization that has made a significant contribution to legal opinion practice in business transactions.
The initial program on October 27, 2020, “Current Ethics Issues Relating to Transactions Practice”, pertained to current ethics issues in business transactions. The programming on October 27, 2020 concluded with a meeting of six affinity groups. WGLO has established various affinity groups where lawyers can meet with lawyers practicing in similar practice areas. The six affinity groups that met were the Capital Markets/Public Securities, Commercial Law and Finance, Corporate/Alternative Entities, Cross-Border Transactions, Private Equity/Venture Capital and Real Estate Affinity Groups.
During the Real Estate Affinity Group meeting, there was a discussion concerning the initiation of the project that will update the 2003 Real Estate Opinion Letter Guidelines issued by the opinions committees of RPTE and ACREL. The opinions committees of ACREL, ACMA and RPTE (as well as the WGLO’s Real Estate Affinity Group) have all approved the initiation of that project. The 2003 Real Estate Opinion Letter Guidelines adopted the BLS Guidelines and Principles in their entirety and added real estate-centric provisions to deal with opinion practice issues of particular interest to real estate attorneys. Substantial changes were made to the BLS Principles and Guidelines by the Statement of Opinion Practices, and, accordingly, the 2003 Real Estate Opinion Letter Guidelines will be updated. Concern was expressed that those portions of the BLS Guidelines not addressed by the Statement of Opinion Practices might at some future time be the subject of an effort by WGLO and BLS to address those portions of the Guidelines not addressed by the Statement. Efforts are underway to establish a steering committee for the update project. In addition, one of the participants in the Real Estate Affinity Group meeting indicated that the WGLO’s local counsel opinion letter project remains ongoing and there may be a revised draft of the report that will be circulated later this year. There was also some discussion regarding the (then) upcoming WGLO program on follow-on opinions in light of the practice in many real estate loan modification transactions where opinions are requested and provided. The consensus was that this topic has been largely unaddressed in the existing opinion-letter literature and might be a subject for a potential project. It was pointed out that real estate lawyers will be interested in that program and possible follow-on work inasmuch as real estate lawyers frequently deal with opinions in the context of mortgage loan amendments (which, as was pointed out, may be especially timely due to COVID-19 relief amendments and LIBOR transition related amendments that are anticipated to be forthcoming).
The final day of programming was October 29, 2020 and consisted of a single program, “Follow-On Opinions: Advancing the Practice”. This program was presented as a break-out session. Conference attendees divided into three “virtual” groups where the break-out program leaders worked through a variety of topics in interactive sessions with attendees. The breakout sessions were, in a way, a follow-on to a webinar presented by WGLO in August 2020. A feature of the break-out program format is that attendees speak without attribution in order to facilitate discussion. Follow-on opinions are opinions that may be issued in a transaction following the origination of that transaction. Among the topics discussed were opinions to be provided in the context of loan modifications. There was a consensus that the opinion giver in the loan modification context had to address the documents provided at the origination of the loan either by assuming certain matters with respect to those documents (e.g., that the documents delivered at loan origination are enforceable and have not been subsequently modified except for the modification wrought by the loan modification in question) or establishing (or re-establishing) the facts and legal conclusions reached in the context of the opinions provided in connection with the origination of the loan.
WGLO’s Fall Meeting provided attendees with a deep-dive into several opinion-related topics. The affinity group session and the break-out session on the final day of the conference provided participants with an opportunity to discuss opinion issues on an interactive basis.
