Report on Third-Party Remedies Opinions - 2007 Update
Appendix 5: Third-Party Legal Opinion Survey

Introduction

The California State Bar Business Law Section's Task Force on Legal Opinions is gathering information about customary practices in California concerning third-party legal (closing) opinions.

We do not plan to disclose individual responses outside the Task Force. However, the Task Force may disclose to others compilations of the survey results and participants.

If you have any questions about this survey, please contact Morris Hirsch at (415) 765-3874.

Please return your survey response (by regular mail, fax or e-mail) by July 19, 2001, to:

Morris Hirsch
400 California Street, 16th Floor
San Francisco, CA 94104
Fax: (415) 765-3391
E-mail: morris.hirsch@uboc.com

Thank you very much for your assistance.

Background Information

Name of person completing survey: Blank line for inserting response
Phone number:  Blank line for inserting response
Law firm: Blank line for inserting response

Size of law firm:

Check box for marking response a. up to 10 lawyers
Check box for indicating response b. 11 to 100 lawyers
Check box for indicating response c. more than 100 lawyers

Is your firm a multistate law firm?

Check box for indicating response a. Yes.
Check box for indicating response b. No.

Does your firm have an Opinion Committee (or a designated group of lawyers within your firm) that (1) sets firm policy for the delivery of legal opinions and/or (2) approves (or a member of which approves) a legal opinion before the firm delivers the opinion?

Check box for indicating response a. Yes.
Check box for indicating response b. No.

What is your current position in the firm? (Check all that apply.)

Check box for indicating response Partner
Check box for indicating response Associate
Check box for indicating response Chair of Opinion Committee
Check box for indicating response Member (but not Chair) of the Opinion Committee
Check box for indicating response Managing Partner of the firm
Check box for indicating response In-house General Counsel for the firm
Check box for indicating response In-house Ethics Counsel for the firm
Check box for indicating response Other. Please describe:

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Survey

Unless otherwise indicated, all questions relate solely to your firm's customary practices when issuing third-party legal (closing) opinions under California law. This survey focuses on remedies opinions, as opposed to other types of legal opinions. Remedies opinions can be expressed in various ways, but essentially relate to the enforceability of one or more contracts.

1. In what types of transactions does your firm customarily issue remedies opinions (assuming any legal opinion is given in the transaction)?

Check box for indicating response a. Securities offerings
Check box for indicating response b. Mergers & acquisitions
Check box for indicating response c. Real estate sales
Check box for indicating response d. Loans, including loans:
           Check box for indicating response i. Secured by personal property
           Check box for indicating response ii. Secured by real estate
           Check box for indicating response iii. Unsecured
e. Lease transactions:
           Check box for indicating response i. Personal property
           Check box for indicating response ii. Real estate
Check box for indicating response f. Other types of transactions. Describe:

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2. When giving a remedies opinion with respect to the enforceability of a contract, does your firm customarily consider the opinion to include:

Check box for indicating responsea. Each and every provision of the contract.
Check box for indicating response b. Only the essential, material or some similar subset of the contract’s provisions.
Check box for indicating response c. My firm believes 2.b is customary, but as a precaution we prepare remedies opinions as if 2.a were applicable.

3. Does your firm customarily include a "generic exception"* when it issues remedies opinions?
Check box for indicating response a. Yes.
Check box for indicating response b. No.
Check box for indicating response c. Only in certain types of transactions. Describe:

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* Specific forms of a "generic exception" vary, but here is an example: Our opinion is subject to the qualification that certain provisions of the Agreement may be unenforceable, but such unenforceability will not, subject to the other exceptions, qualifications and limitations contained in this opinion letter, render the Agreement invalid as a whole or substantially interfere with realization of the principal benefits intended to be provided by the Agreement.

4. Please indicate which, if any, of the following types of contractual provisions your firm customarily expressly excludes from its remedies opinions:
Check box for indicating response a. Choice-of-law provisions.
Check box for indicating response b. Covenants not to compete.
Check box for indicating response c. Provisions for penalties, liquidated damages, acceleration of future amounts due (other than principal) without appropriate discount to present value, late charges, prepayment charges, or increased interest rates upon default.
Check box for indicating response d. Time-is-of-the-essence clauses.
Check box for indicating response e. Confession of judgment clauses.
Check box for indicating response f. Provisions that contain a waiver of broadly or vaguely stated rights.
Check box for indicating response g. Provisions that contain a waiver of the benefits of statutory, regulatory, or constitutional
rights, unless and to the extent the statute, regulation, or constitution explicitly allows waiver.
Check box for indicating response h. Provisions that contain a waiver of unknown future defenses.
Check box for indicating response i. Provisions that contain a waiver of rights to damages.
Check box for indicating response j. Provisions that contain a waiver of obligations of good faith, fair dealing and commercial reasonableness.
Check box for indicating response k. Provisions that attempt to change or waive rules of evidence or fix the method or quantum of proof to be applied in litigation or similar proceedings.
Check box for indicating response l. Provisions for the appointment of a receiver.
Check box for indicating response m. Forum selection clauses and consent to jurisdiction clauses (as to personal jurisdiction or subject matter jurisdiction).
Check box for indicating response n. Provisions appointing one party as an attorney-in-fact for an adverse party.
Check box for indicating response o. Waivers of rights to jury trials.
Check box for indicating response p. Provisions requiring arbitration of disputes arising out of the transaction.
Check box for indicating response q. Provisions that by their express terms state that fewer than all parties to the contract are entitled to recover attorneys’ fees and expenses.
Check box for indicating response r. Provisions that prohibit oral modifications.
Check box for indicating response s. Indemnity of a party for damages arising out of its own misconduct.
Check box for indicating response t. Self-help remedy provisions.
Check box for indicating response u. Indemnification for securities law liabilities.
Check box for indicating response v. Voting agreements.
Check box for indicating response w. Other. Describe:

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5. Which, if any, of the types of contractual provisions referred to in Question 4 does your firm customarily consider to be excluded by an “equitable principles limitation”** expressly or impliedly included in an opinion? Specify by reference to letters in Question 4:

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** A typical “equitable principles limitation” is as follows: The enforceability of the Company’s obligations under the Agreement is subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

6. In real property transaction opinions, does your firm customarily refuse to issue opinions covering:
Check box for indicating response a. Land use matters.
Check box for indicating response b. Environmental matters.
Check box for indicating response c. Leases.
Check box for indicating response d. Title.
Check box for indicating response e. Assignments of rents.
Check box for indicating response f. Other. Describe:

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7. Does the following paragraph substantially describe your firm's customary practices in deciding whether and to what extent to conduct legal research in support of a remedies opinion? When we give a remedies opinion: (i) we do not conduct legal research as to any provision of a contract covered by the opinion unless, in applying reasonable professional judgment to that provision, we recognize, without conducting legal research, that there is a not insignificant degree of uncertainty as to the enforceability of that provision based on the existence of California law directly applicable to our client, the transaction, or both; and (ii) we rely on general contract law principles to support an opinion as to the enforceability of such a provision in the absence of California law that we, in applying reasonable professional judgment to that provision, recognize, in accordance with (i) above, as being directly applicable to our client, the transaction, or both.
Check box for indicating response a. Yes.
Check box for indicating response b. No. How do your firm's customary practices substantially differ from this?

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8. a. Does your firm customarily issue legal opinions governed by the 1991 Legal Opinion Accord of the ABA Business Law Section?
Check box for indicating response i. Yes.
Check box for indicating response ii. No.
b. If you answered “Yes” in Question 8.a, are your firm’s ABA Accord legal opinions customarily governed by the “California Provisions” as defined in the California State Bar Business Law Section’s 1992 Report on the Third-Party Legal Opinion Report of the ABA Section of Business Law?
Check box for indicating response i. Yes.
Check box for indicating response ii. No.
c. If you answered “Yes” in Question 8.a, are your firm’s ABA Accord legal opinions in real property transactions customarily issued in accordance with the 1995 California Real Property Legal Opinion Report and the 1998 First Supplement to 1995 California Real Property Legal Opinion Report?
Check box for indicating response i. Yes.
Check box for indicating response ii. No.

9. [Answer only if your firm customarily issues remedies opinions under the law of states other than California, as well as under California law.] Do your firm's customary practices (as to the form of the opinion or exceptions/limitations/qualifications, as to legal research supporting the opinion, or otherwise) substantially differ when your firm issues remedies opinions under the law of states other than California than when issuing remedies opinions under California law?
Check box for indicating response a. No.
Check box for indicating response b. Yes. Please describe the substantial differences:

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10. Would your responses to any of the above questions substantially differ when your firm is requesting a legal opinion rather than issuing one?
Check box for indicating response a. No.
Check box for indicating response b. Yes. Please describe the substantial differences:

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11. Would the chair of your firm’s Opinion Committee or another representative of your firm be willing to serve as an advisor to the Business Law Section’s Task Force on Legal Opinions?
Check box for indicating response a. No.
Check box for indicating response b. Yes. If other than the person completing this survey, please specify:

Name: Blank line for inserting response

Phone number: Blank line for inserting response

12. [Optional] Please attach the form(s) of California remedies opinion, and the applicable exceptions/limitations/qualifications, which your firm customarily issues.
13. [Optional] Please note any additional comments you think would be useful to the Task Force on Legal Opinions.

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Thank you very much for completing this survey. Please return your response by July 19, 2001, to the address set forth in the Introduction.

Appendix 6 / Report on Third-Party Remedies Opinions