FH Partners argued on appeal that, although the FDIC didn’t own the loan on December 16, 2008, the FDIC’s backdated transaction with Weatherford remedied the problem retroactively.
The appellate court determined two separate issues: (1) whether the FDIC’s June 10, 2009 transaction with Weatherford was effective to retroactively transfer the loan to the FDIC as between the FDIC and Weatherford and (2) whether a retroactive effect applied to the FDIC’s earlier transaction with FH Partners.
For a shorter piece with a few practical tips see Backdating – it’s illegal isn’t it?
Setting aside such issues, avoiding unwanted side effects of backdating contracts can be tricky, especially when the purported effective date of an agreement is several months before the date it was actually signed, as can be seen in involves the ownership of a promissory note that was made to a bank in connection with a loan.
Thus, the FDIC and Weatherford could have made their transaction retroactive, but they didn’t document the deal clearly enough to do so.