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7th Circuit upholds ruling in favor of borrowers

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A dispute between a lender and subsidiaries created by a restaurant owner to refinance its debt made its way before the 7th Circuit Court of Appeals for the second time. This time, the judges ruled in favor of the borrowers.

Quality Dining Inc. created subsidiaries BKCAP LLC, GRAYCAP LLC, and SWCAP LLC and made a deal with Captec Financial and GE Capital for 34 separate loans, with each loan secured by a restaurant. Captec assigned 13 of its loans to Captec Franchise Trust 2000-1. The borrowers and lender disagreed about the prepayment requirements for 12 of the loans, landing the parties in court and before the 7th Circuit in 2009.

There is ambiguity in the prepayment provision of the loan agreements, so the judges sent the case back to the District Court for a full trial on the merits. The 7th Circuit found both parties’ arguments as to how to interpret the loan agreement impossible without additional evidence. The District Court then ruled in favor of the borrowers, awarded prejudgment interest, and denied attorney fees for lender Captec Franchise Trust 2000-1.

The lender appealed, claiming the borrowers’ interpretation of the prepayment provision is unreasonable based on the language of the decision issued by the 7th Circuit in the first appeal. The judges did say the borrowers’ interpretation was unreasonable, but the lender’s argument is way off base, wrote Judge John Tinder. The judges didn’t call the lender’s interpretation unreasonable, but they should have, he wrote.

The evidence offered at trial supports the borrowers’ interpretation, and the District Court didn’t err in considering the testimony of the borrowers’ lead negotiator, who testified about an original lenders’ lead negotiator’s construction of the prepayment provision.

There is also no question that the borrowers are entitled to prejudgment interest after September 2009, Tinder wrote, and that the lender is not entitled to attorney fees.

 

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  1. Indianapolis employers harassment among minorities AFRICAN Americans needs to be discussed the metro Indianapolis area is horrible when it comes to harassing African American employees especially in the local healthcare facilities. Racially profiling in the workplace is an major issue. Please make it better because I'm many civil rights leaders would come here and justify that Indiana is a state the WORKS only applies to Caucasian Americans especially in Hamilton county. Indiana targets African Americans in the workplace so when governor pence is trying to convince people to vote for him this would be awesome publicity for the Presidency Elections.

  2. Wishing Mary Willis only God's best, and superhuman strength, as she attempts to right a ship that too often strays far off course. May she never suffer this personal affect, as some do who attempt to change a broken system: https://www.youtube.com/watch?v=QojajMsd2nE

  3. Indiana's seatbelt law is not punishable as a crime. It is an infraction. Apparently some of our Circuit judges have deemed settled law inapplicable if it fails to fit their litmus test of political correctness. Extrapolating to redefine terms of behavior in a violation of immigration law to the entire body of criminal law leaves a smorgasbord of opportunity for judicial mischief.

  4. I wonder if $10 diversions for failure to wear seat belts are considered moral turpitude in federal immigration law like they are under Indiana law? Anyone know?

  5. What a fine article, thank you! I can testify firsthand and by detailed legal reports (at end of this note) as to the dire consequences of rejecting this truth from the fine article above: "The inclusion and expansion of this right [to jury] in Indiana’s Constitution is a clear reflection of our state’s intention to emphasize the importance of every Hoosier’s right to make their case in front of a jury of their peers." Over $20? Every Hoosier? Well then how about when your very vocation is on the line? How about instead of a jury of peers, one faces a bevy of political appointees, mini-czars, who care less about due process of the law than the real czars did? Instead of trial by jury, trial by ideological ordeal run by Orwellian agents? Well that is built into more than a few administrative law committees of the Ind S.Ct., and it is now being weaponized, as is revealed in articles posted at this ezine, to root out post moderns heresies like refusal to stand and pledge allegiance to all things politically correct. My career was burned at the stake for not so saluting, but I think I was just one of the early logs. Due, at least in part, to the removal of the jury from bar admission and bar discipline cases, many more fires will soon be lit. Perhaps one awaits you, dear heretic? Oh, at that Ind. article 12 plank about a remedy at law for every damage done ... ah, well, the founders evidently meant only for those damages done not by the government itself, rabid statists that they were. (Yes, that was sarcasm.) My written reports available here: Denied petition for cert (this time around): http://tinyurl.com/zdmawmw Denied petition for cert (from the 2009 denial and five year banishment): http://tinyurl.com/zcypybh Related, not written by me: Amicus brief: http://tinyurl.com/hvh7qgp

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