PAYDAY INC v. HAMILTON today. Court of Appeals of Indiana

PAYDAY TODAY, INC., Edward R. Hall, Appellants-Defendants, v. Maria L. HAMILTON, Appellee-Plaintiff.

No. 71A03-0805-CV-255.


Defendants/Counterclaimants-Appellants Payday Today, Inc. (“Payday”) and Edward R. Hall (“Hall”) (collectively, “the defendants”) appeal from the test court’s grant of judgment from the pleadings plus the grant of summary judgment in support of Plaintiff-Appellee Maria L. Hamilton (“Hamilton”). We affirm in part, reverse to some extent, and remand.

The defendants raise five dilemmas for the review, which we restate since:

We. Or perhaps a test court erred in giving summary judgment on Hamilton’s claim underneath the Small Claims Act.

II. Whether or not the test court erred in giving summary judgment on Hamilton’s claim beneath the Fair business collection agencies ways Act.

III. Or perhaps a test court erred in giving judgment for Hamilton from the defendants’ counterclaims.

IV. Perhaps the defendants had been unfairly rejected leave to amend their counter-complaint.

V. Perhaps the test court erred in giving lawyer charges to Hamilton.


Payday is really a payday financial institution, and Hall is its lawyer. A“small loan” as defined by Ind.Code В§ 24-4.5-7-104(a) in July of 2004, Payday loaned $125.00 to Hamilton. Underneath the regards to the mortgage contract, Hamilton would be to spend $143.75, such as the $125.00 principal plus an $18.75 solution cost, inside a fortnight through the date regarding the loan. As safety when it comes to loan, Hamilton supplied Payday having a post-dated search for $143.75. Whenever Hamilton’s check ended up being returned to Payday, Hall mailed her a page demanding the quantity of the check, along with a $20.00 returned check cost and $300.00 in lawyer charges. The page claimed that payment of the quantities had been essential for Hamilton to prevent a lawsuit. Particularly, the page claimed in pertinent component:

Re: DISHONORED CHECK TO Payday Today, Inc./South Bend

Please be encouraged that this workplace happens to be retained to represent the above lender with respect to a tiny loan contract No ․, dated 06/03/2004. This loan provider accepted your check as protection for the loan into the quantity of ($143.75). The contract called for the check to be cashed pursuant to your regards to the mortgage contract, in the event that you hadn’t formerly made plans to meet the mortgage. You have got neglected to make re re payment towards the loan provider as agreed, and upon presentation, the banking organization upon which it absolutely was drawn failed to honor your check. You’ve been formerly notified because of the loan provider of the returned check and now have taken no action to solve the situation.

IF YOU WISH TO RESOLVE THIS SITUATION WITHOUT HAVING A LAWSUIT, the time has come for action. To take action, you need to spend the next quantities, (1) the amount that is full of check plus, (2) a $20 returned check cost, and (3) lawyer costs of $300. This re payment must certanly be by means of a cashier’s money or check purchase payable to Attorney Edward R. Hall. In the event that you neglect to spend in complete the quantity due within ten times through the date for this page, we might register suit straight away, where you are responsible for the after amount under I.C. В§ 24-4.7-5 et seq.; (1) the amount of the check; (2) a twenty buck returned check cost; (3) court expenses; (4) reasonable lawyer charges; (5) all the other reasonable expenses of collection; (6) 3 x (3x) the amount of the verify that the facial skin number of the check wasn’t higher than $250.00, or (7) in the event that face level of the check ended up being $250.00 or maybe more, the check quantity plus five hundred bucks ($500.00), and pre-judgment interest at the price of 18per cent per year.

(Appellants’ App. 1 at 13; Appellant’s App. 2 at 17). (Emphasis in initial). Hall’s page further recommends Hamilton that she might be accountable for different damages if she had been discovered to own presented her sign in a fraudulent way.

Hamilton filed a grievance against Payday and Hall alleging violations associated with Indiana Uniform customer Credit Code-Small Loans (Ind.Code § 24-4.5-7 et seq.) (“SLA”) in addition to federal Fair Debt Collection techniques Act (15 U.S.C. § 1692) (“FDCPA”). In Count We of this issue, Hamilton alleged that Payday violated the SLA whenever

a. Hall threatened ․ to file case against Hamilton that will demand damages in overabundance what the defendants are allowed to recoup under I.C. 24-4.5-7-202, thus breaking I.C. 24-4.5-7-410(b), and Payday caused this hazard to be manufactured, thus breaking I.C. 24-4.5-7-410(b).

b. Hall made misleading and misleading statements to Hamilton ․ concerning the quantity the defendants could recover for a tiny loan, thus breaking I.C. 24-4.5-7-410(c), and Payday caused these statements to be manufactured, therefore breaking I.C. 24-4.5-7-410(c).

c. Hall represented in their letter that Hamilton, as being a debtor of a tiny loan, is likely for lawyer charges compensated by the loan provider associated with the assortment of the little loan, therefore breaking I.C. 24-4.5-7-410(d), and Payday caused these representations to be manufactured, therefore breaking I.C. 24-4.5-7-410(d).

d. Hall made deceptive and fraudulent representations in their page regarding the quantity a loan provider is eligible to recover for a tiny loan, therefore breaking I.C. 24-4.5-7-410(g), and Payday caused these representations to be produced, therefore breaking I.C. 24-4.5-7-410(g).

(Appellant’s Appendix 2 at 100-01). Hamilton alleged in Count II that Hall violated the FDCPA. Id. at 101. She asked for declaratory judgment pursuant to Ind.Code В§ 24-4.5-7-409( 4)( ag ag ag e) that Payday had no right to gather, get, or retain any principal, interest, or any other fees through the loan. She additionally asked for statutory damages of $2000 and expenses and damages pursuant to Ind.Code В§ 24-4.5-7-409(4)(e). She further asked for statutory damages of $500 pursuant to Ind.Code В§ 24-4.5-7-409(4)(c) and Ind.Code В§ 24-5-0.5-4. Finally, she asked for statutory damages of $1000 pursuant to 15 U.S.C. В§ 1692k(a) and “such other and relief that is further the court deems simply and equitable.” Id.

Payday and Hall reacted by filing a remedy and three counterclaims against Hamilton for (1) defrauding an institution that is financial Ind.Code В§ 35-43-5-8, (2) moving a negative check under Ind.Code В§ 26-2-7-6, and (3) breach of the agreement.