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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. The voices of the prophets are more on blogs than subway walls these days, Dawn. Here is the voice of one calling out in the wilderness ... against a corrupted judiciary ... that remains corrupt a decade and a half later ... due to, so sadly, the acquiescence of good judges unwilling to shake the forest ... for fear that is not faith .. http://www.ogdenonpolitics.com/2013/09/prof-alan-dershowitz-on-indiana.html

  2. So I purchased a vehicle cash from the lot on West Washington in Feb 2017. Since then I found it the vehicle had been declared a total loss and had sat in a salvage yard due to fire. My title does not show any of that. I also have had to put thousands of dollars into repairs because it was not a solid vehicle like they stated. I need to find out how to contact the lawyers on this lawsuit.

  3. It really doesn't matter what the law IS, if law enforcement refuses to take reports (or take them seriously), if courts refuse to allow unrepresented parties to speak (especially in Small Claims, which is supposedly "informal"). It doesn't matter what the law IS, if constituents are unable to make effective contact or receive any meaningful response from their representatives. Two of our pets were unnecessarily killed; court records reflect that I "abandoned" them. Not so; when I was denied one of them (and my possessions, which by court order I was supposed to be able to remove), I went directly to the court. And earlier, when I tried to have the DV PO extended (it expired while the subject was on probation for violating it), the court denied any extension. The result? Same problems, less than eight hours after expiration. Ironic that the county sheriff was charged (and later pleaded to) with intimidation, but none of his officers seemed interested or capable of taking such a report from a private citizen. When I learned from one officer what I needed to do, I forwarded audio and transcript of one occurrence and my call to law enforcement (before the statute of limitations expired) to the prosecutor's office. I didn't even receive an acknowledgement. Earlier, I'd gone in to the prosecutor's office and been told that the officer's (written) report didn't match what I said occurred. Since I had the audio, I can only say that I have very little faith in Indiana government or law enforcement.

  4. One can only wonder whether Mr. Kimmel was paid for his work by Mr. Burgh ... or whether that bill fell to the citizens of Indiana, many of whom cannot afford attorneys for important matters. It really doesn't take a judge(s) to know that "pavement" can be considered a deadly weapon. It only takes a brain and some education or thought. I'm glad to see the conviction was upheld although sorry to see that the asphalt could even be considered "an issue".

  5. In response to bryanjbrown: thank you for your comment. I am familiar with Paul Ogden (and applaud his assistance to Shirley Justice) and have read of Gary Welsh's (strange) death (and have visited his blog on many occasions). I am not familiar with you (yet). I lived in Kosciusko county, where the sheriff was just removed after pleading in what seems a very "sweetheart" deal. Unfortunately, something NEEDS to change since the attorneys won't (en masse) stand up for ethics (rather making a show to please the "rules" and apparently the judges). I read that many attorneys are underemployed. Seems wisdom would be to cull the herd and get rid of the rotting apples in practice and on the bench, for everyone's sake as well as justice. I'd like to file an attorney complaint, but I have little faith in anything (other than the most flagrant and obvious) resulting in action. My own belief is that if this was medicine, there'd be maimed and injured all over and the carnage caused by "the profession" would be difficult to hide. One can dream ... meanwhile, back to figuring out to file a pro se "motion to dismiss" as well as another court required paper that Indiana is so fond of providing NO resources for (unlike many other states, who don't automatically assume that citizens involved in the court process are scumbags) so that maybe I can get the family law attorney - whose work left me with no settlement, no possessions and resulted in the death of two pets (etc ad nauseum) - to stop abusing the proceedings supplemental and small claims rules and using it as a vehicle for harassment and apparently, amusement.

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