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Interest rate charged by bank upheld by Court of Appeals

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The Indiana Court of Appeals relied on a similar case out of Ohio to find that a bank did not exceed the agreed-upon interest rate of commercial borrowers by applying a 365/360 interest calculation method as some borrowers claimed in a class action.

Lake City Bank filed a commercial foreclosure action against certain borrowers. John M. Abbott LLC was the lead plaintiff in a counterclaim seeking certification as a class and alleging that Lake City Bank had breached the terms of promissory notes pertaining to the interest rate. The promissory note John Abbott on behalf of the LLC says, “The annual interest rate for this Note is computed on a 365/360 basis; that is, by applying the ration of the annual interest rate over a year of 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding.”  The note also includes information with regard to the variable interest rate.

The trial court granted the bank’s motion for summary judgment.

In John M. Abbott, LLC, Class Representative and All Others Similarly Situated v. Lake City Bank, 02A05-1402-PL-53, the judges noted it seems that the Abbott LLC challenged the 365/360 method of calculating payments, claiming this method conflicts with the interest rate term “per annum” and results in a higher effective interest rate than the initial rate specified in the note. But this method has been consistently upheld in federal courts and other jurisdictions, Judge Terry Crone pointed out.

Abbott LLC claimed the bank’s note is intrinsically ambiguous and challenges the use of the term “annual interest rate” instead of “annual interest payments” or “annual interest amount” immediately proceeding the statement concerning the use of the 365/360 method.

The COA found the Ohio Supreme Court decision, JNT Props., LLC v. KeyBank Nat’l Ass’n, 981 N.E.2d 804, 806 (Ohio 2012), to be persuasive. Just as the Ohio court held, the Indiana judges found that the explanatory phrase that immediately follows the disputed clause negates any confusion that otherwise might have been caused by the inclusion of the term “annual interest rate” instead of “annual interest amount” when specifying the method of calculating payments.

“As in KeyBank, the Note makes it clear that the term being defined (the 365/360 method) is the method of computing regular interest payments, not the annual interest rate. As for the interest rate, the ‘VARIABLE INTEREST RATE’ paragraph clearly states that the interest rate will be tied to the ‘Five Year Treasury Bill’ index.

There is also no designated evidence to indicate that John Abbott did not understand what he was signing or that he sought clarification before doing so, the judges noted.
 

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  1. All the lawyers involved in this don't add up to a hill of beans; mostly yes-men punching their tickets for future advancement. REMF types. Window dressing. Who in this mess was a real hero? the whistleblower that let the public know about the torture, whom the US sent to Jail. John Kyriakou. http://www.nytimes.com/2013/01/26/us/ex-officer-for-cia-is-sentenced-in-leak-case.html?_r=0 Now, considering that Torture is Illegal, considering that during Vietnam a soldier was court-martialed and imprisoned for waterboarding, why has the whistleblower gone to jail but none of the torturers have been held to account? It's amazing that Uncle Sam's sunk lower than Vietnam. But that's where we're at. An even more unjust and pointless war conducted in an even more bogus manner. this from npr: "On Jan. 21, 1968, The Washington Post ran a front-page photo of a U.S. soldier supervising the waterboarding of a captured North Vietnamese soldier. The caption said the technique induced "a flooding sense of suffocation and drowning, meant to make him talk." The picture led to an Army investigation and, two months later, the court martial of the soldier." Today, the US itself has become lawless.

  2. "Brain Damage" alright.... The lunatic is on the grass/ The lunatic is on the grass/ Remembering games and daisy chains and laughs/ Got to keep the loonies on the path.... The lunatic is in the hall/ The lunatics are in my hall/ The paper holds their folded faces to the floor/ And every day the paper boy brings more/ And if the dam breaks open many years too soon/ And if there is no room upon the hill/ And if your head explodes with dark forbodings too/ I'll see you on the dark side of the moon!!!

  3. It is amazing how selectively courts can read cases and how two very similar factpatterns can result in quite different renderings. I cited this very same argument in Brown v. Bowman, lost. I guess it is panel, panel, panel when one is on appeal. Sad thing is, I had Sykes. Same argument, she went the opposite. Her Rooker-Feldman jurisprudence is now decidedly unintelligible.

  4. November, 2014, I was charged with OWI/Endangering a person. I was not given a Breathalyzer test and the arresting officer did not believe that alcohol was in any way involved. I was self-overmedicated with prescription medications. I was taken to local hospital for blood draw to be sent to State Tox Lab. My attorney gave me a cookie-cutter plea which amounts to an ALCOHOL-related charge. Totally unacceptable!! HOW can I get my TOX report from the state lab???

  5. My mother got temporary guardianship of my children in 2012. my husband and I got divorced 2015 the judge ordered me to have full custody of all my children. Does this mean the temporary guardianship is over? I'm confused because my divorce papers say I have custody and he gets visits and i get to claim the kids every year on my taxes. So just wondered since I have in black and white that I have custody if I can go get my kids from my moms and not go to jail?

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