<em>Wellenkamp v. Bank of America</em>: Exercise of Due-on-Sale Clauses as an Unreasonable Restraint Upon Alienation
Galt, Robert
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Abstract
The author examines the history of due-on-sale clauses, tracing its treatment in the Supreme Court of California to its most recent pronouncement, where the court found the clause to be an unreasonable restraint on alienation absent proof from the institutional lender that enforcement was necessary to protect against risk of default or impairment of its security. The author concludes that the rationale of the court reasonably balances the common law rule against restraint on alienation and the lender's interest.