The bank is considering making a loan on a piece of property that is home to a chemical factory. There is no evidence of any contamination, but the bank is concerned about being liable if there is a chemical spill. Should the bank be concerned?
What will be an ideal response?
The bank should not be concerned. The bank would be a secured creditor because the property is collateral for the loan. As long as the bank does not participate in the management of the factory, it should be exempt from liability for a spill.
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