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COA finds argument that documents were ambiguous is really ‘a failure to read’

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A real estate investor who argued that he should not be held personally liable because the loan documents were ambiguous was reminded by the Indiana Court of Appeals that “a failure to read does not equate with an ambiguity….”  

In Steven Weinreb v. Fannie Mae, 49A04-1211-PL-587, the appeals court affirmed the trial court’s partial grant of summary judgment and grant of monetary award to Fannie Mae. Specifically, the court found the loan documents were not ambiguous; the non-recourse carve-outs and prepayments premium provisions of the note were enforceable; and the guaranty as well as the loan documents were not unconscionable.

It also concluded that claim preclusion and collateral estoppel do not preclude Steven Weinreb from challenging the lower court’s partial grant of summary judgment.

Weinreb, a resident of New York, and his business partners formed WK Strawbridge, LLC, in 2006 to acquire the title to Strawbridge Green Apartments in Indianapolis. Permanent financing was eventually sought from Arbor Commercial Funding, LLC, which provided a commercial loan in the principal amount of $6 million through Fannie Mae.

Beginning in December 2009, a series of mechanic’s liens were filed against the apartments, totaling $72,287.12. In July 2010, Strawbridge LLC failed to pay its monthly installments under the promissory note. A month later, Fannie Mae sent Strawbridge LLC and Weinreb a demand letter for immediate payment of the loan installments, ordering Strawbridge LLC to remit tenant rental payments directly to Fannie Mae, and advised that failure to pay amounted to a default under the terms of the note.

On July 20, 2011, Fannie Mae was awarded summary judgment in rem in the amount of $7.81 million. The trial court ordered foreclosure but found that Fannie Mae’s claims against Weinreb were not resolved by this judgment and could be pursued at a later date.

Fannie Mae then bought the apartments from the sheriff’s sale for $6.61 million, leaving a deficiency of $1.81 million plus interest and expenses. In Feb. 2012, Fannie Mae filed a complaint against Weinreb for the deficiency.

Weinreb argued he had not read the loan documents prior to signing them because the complexity of the papers was overwhelming. However, the trial court rejected Weinreb’s arguments and issued a partial summary judgment in favor of Fannie Mae and against Weinreb in the amount of $1.81 million.

Weinreb appealed, again asserting, in part, that the loan documents were extrinsically ambiguous which made summary judgment inappropriate. He did not raise an issue with the language but, rather, he argued that the implementation of the agreements resulted in latent ambiguity.

The court of appeals found no ambiguity in either the note, the mortgage or the guaranty. It also did not find any ambiguity coming during the implementation.

“A failure to read does not equate with an ambiguity arising from the implementation of the clear terms of the Note, Mortgage and Guaranty,” Judge Patricia Riley wrote for the court.
 

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  1. My husband financed a car through Wells Fargo In dec 2007 and in Jan 2012 they took him to court to garnish his wages through a company called autovest llc . Do u think the statue of limitations apply from the day last payment was received or from what should have been the completion of the loan

  2. Andrew, you are a whistleblower against an ideologically corrupt system that is also an old boys network ... Including old gals .... You are a huge threat to them. Thieves, liars, miscreants they understand, identify with, coddle. But whistleblowers must go to the stake. Burn well my friend, burn brightly, tyger.

  3. VSB dismissed the reciprocal discipline based on what Indiana did to me. Here we have an attorney actually breaking ethical rules, dishonest behavior, and only getting a reprimand. I advocated that this supreme court stop discriminating against me and others based on disability, and I am SUSPENDED 180 days. Time to take out the checkbook and stop the arrogant cheating to hurt me and retaliate against my good faith efforts to stop the discrimination of this Court. www.andrewstraw.org www.andrewstraw.net

  4. http://www.andrewstraw.org http://www.andrewstraw.net If another state believes by "Clear and convincing evidence" standard that Indiana's discipline was not valid and dismissed it, it is time for Curtis Hill to advise his clients to get out the checkbook. Discrimination time is over.

  5. Congrats Andrew, your street cred just shot up. As for me ... I am now an administrative law judge in Kansas, commissioned by the Governor to enforce due process rights against overreaching government agents. That after being banished for life from the Indiana bar for attempting to do the same as a mere whistleblowing bar applicant. The myth of one lowly peasant with the constitution does not play well in the Hoosier state. As for what our experiences have in common, I have good reason to believe that the same ADA Coordinator who took you out was working my file since 2007, when the former chief justice hired the same, likely to "take out the politically incorrect trash" like me. My own dealings with that powerful bureaucrat and some rather astounding actions .. actions that would make most state courts blush ... actions blessed in full by the Ind.S.Ct ... here: https://www.scribd.com/doc/299040839/2016Petitionforcert-to-SCOTUS

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