I'd like to make a clarification, there seem to be a good many posts which infer that Lendy have promised follow up cash, the assumption being that Lendy would go back and ask for their lender base to fund say a tranche 2, 3...etc. The follow on assumption being that the borrower has misunderstood how Lendy works, and I may be wrong but in some posts this seems to form the basis for an argument of 'specific investors' v 'the entire Lendy loan pool'.
So, to clarify, when Lendy first drew this to our attention I asked a number of specific questions, one being why Lendy had withheld funds, since this seemed to be the core to the borrowers claim, injury through fund starvation, this forms part of that answer and is direct from Lendy support -
'With any development loan through Lendy (and is common practice), funds are lent out to the developer in tranches through out the build. This is so that funds for the build are only lent out according to how much building work has progressed, rather than lending them the whole amount at once meaning that we would have no control as to what the funds are used for.
To monitor the progress of any development an Independent Monitoring Surveyor (IMS) is used. They will visit the site and need access to documentation to assess the progress of the build. As part of the contract, the borrowers agree to co-operated with the IMS and provide the suitable information and documentation'.
So, unless anyone has an alternate take, we are only talking the original monies we provided, fed in by part and not new money subsequently offered for funding.
I don't want to go into detail on a public forum other that to say Lendy then assured me, as they have in our other updates, that the contract terms were not met.
So, if I can summarise, if an act which breaches the contract has occurred, on either side, then the only parties involved, and the only parties with knowledge of specifics, are Lendy, the IMS and the borrower. We are not given access to IMS reports, we are not asked for opinion and neither do Lendy seek direction on the outcomes of IMS reports, in fact the only time we have sight or control is at the point of investment or when we offer a preference on a settlement offer, such as 'walk away and I'll not sue you'. That being the case, I fail to understand at a moral level how we can be accused of any wrong doing, and fail to reason any way a court could see it differently. WHICH LEAVES CONTRACT LAW.
If we are contract to/by Lendy in such a way that we are liable for miss-management (or criminality?) on Lendy's part, then we would be seen in effect as Lendy, their actions being our actions. DOES ANYONE KNOW IF THIS IS THE CASE?
If it is, then Lendy, it appears to me, have a duty of disclosure to inform us of the risks we co-opt in doing business with them, and I at least am unaware of anywhere we are so informed. DOES ANYONE KNOW DIFFERENT?
If we are so linked in risk, but only now come to know it I'd say that's a breach of trust worthy of court action and a referral to the FCA?