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The parties’ intent for the transaction to have retroactive effect must be clear.Merely stating a retroactive effective date in the main agreement may not do the trick.In this article, the author writes: “Backdating by itself is not generally, at least with respect to private agreements, illegal.
It is of common occurrence in connection with deeds, leases and other contracts that, while they are not in effect at all and have no legal existence until delivered, yet, in respect to the date of delivery, they, in point of commencement, relate back or commence in the future.Lawyers who were trained in commonwealth jurisdictions may have an ingrained concept that backdating a document is generally improper, if not illegal.This is reflected in the Linklaters article Execution of Documents: Five Common Questions Answered, which offers the following advice for in-house lawyers: “(i) contracts may only be backdated, absent fraud, in circumstances where an original form has been lost or where terms have been fully agreed but signatures have been left to a later date and (ii) deeds may never be backdated.” Unfortunately, the article offers scant authority, and a search on Google reveals little else on the subject from the commonwealth world.The trial court granted the defendants summary judgment, holding that FH Partners didn’t own the loan and so it couldn’t enforce it.On appeal, the Missouri Court of Appeals, Western District agreed.
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The commonwealth-trained (and more prudent) approach would be to insert the date only when the last party has signed and to use a date no earler than the date of that last signature.