The Limits of Lawyering: Legal Opinions in Structured Finance
The most up-to-date version of this piece can be found in the Duke Law Scholarship
Significant controversy surrounds the issuance of legal opinions in structured finance transactions, particularly where accountants separately use these opinions, beyond their traditional primary use, for determining whether to characterize the transactions as debt. Reflecting at its core the unresolved boundaries between public and private in financial transactions, this controversy raises important issues of first impression: To what extent, for example, should lawyers be able to issue legal opinions that create negative externalities? Furthermore, what should differentiate the roles of lawyers and accountants in disclosing information to investors? Resolution of these issues not only helps to demystify the mystique, and untangle the morass, of legal-opinion giving but also affects the very viability of the securitization industry, which dominates American, and increasingly global, financing.
Date of Authorship for this Version
Schwarcz, Steven L., "The Limits of Lawyering: Legal Opinions in Structured Finance" (2005). Duke Law School Faculty Scholarship Series. Paper 12.