Cole v. Davis
Decision Date | 26 August 2016 |
Docket Number | No. 1–15–2716.,1–15–2716. |
Citation | 407 Ill.Dec. 514,63 N.E.3d 946 |
Parties | Franklin A. COLE, as Trustee or Representative of the Franklin A. Cole IRA–PEN, Bank One N.A. Account No. XXXXXX–XXXX, Plaintiff–Appellant, v. Allison S. DAVIS; Gallery Park Place, LLC; Davis Group V; Davis Group, LLC; All Chicago, LLC; New Kenwood, LLC; and American Housing, LLC, Defendants–Appellees. |
Court | United States Appellate Court of Illinois |
Paul E. Peldyak and Charles A. Brizzolara, both of Chicago, for appellant.
Arnold H. Landis, of Chicago, for appellees.
delivered the judgment of the court, with opinion.
¶ 1 The present interlocutory appeal arises out of defendants' alleged default on a promissory note. The parties entered into an agreement under the promissory note (the note) on November 17, 2000, by which defendants agreed to pay plaintiff, by December 15, 2000, the principal sum of $100,000 with interest accruing at the publicly announced prime rate of Bank One, N.A. The note contains a confession of judgment clause, which authorizes any attorney to confess judgment on behalf of defendants for the amount outstanding at any time after the payment's due date. After defendants allegedly failed to pay off the principal and interest to plaintiff by the due date, plaintiff filed a confession of judgment suit on December 24, 2014.
¶ 2 On January 7, 2015, the trial court entered judgment in favor of plaintiff for $153,453.97 and costs of suit. Thereafter, defendants filed a motion to vacate and/or open the judgment, arguing that the confession of judgment clause in the note was invalid because it contained a variable interest rate. The trial court granted defendants motion. Plaintiff then filed a motion to certify a question under Illinois Supreme Court Rule 308
(eff. Jan. 1, 2015), arguing that Illinois courts have not addressed whether or not a confession of judgment clause is invalid where it contains a definite principal and a variable interest rate. Plaintiff further argued that section 3–112 of the Uniform Commercial Code (UCC) (810 ILCS 5/3–112 (West 2000) ) expressly authorizes the use of a variable interest rate in instruments like the promissory note in question. The trial court granted plaintiff's motion, and we granted the appeal. For the following reasons, we answer the certified question in the affirmative.
¶ 4 Plaintiff filed a complaint against defendants on December 24, 2014. The complaint alleges that on or about November 17, 2000, defendants made and delivered the note to plaintiff. The complaint attaches a copy of the note, which is dated November 17, 2000. The note heading specifies that it is for $100,000 and designates the location as Chicago, Illinois. The body of the note provides:
The note contains defendants' signatures.
¶ 5 The complaint further alleges that on June 12, 2001, by which date defendants had not paid their debt under the note, the parties entered into a letter agreement amending the note. The complaint attaches a copy of this letter agreement. The letter agreement is addressed to Allison S. Davis, Esq., and is signed by plaintiff, the sender of the letter agreement. The letter agreement is dated June 12, 2001. The body of the letter agreement provides:
The letter agreement contains the signatures of plaintiff and defendants.
¶ 6 The complaint next alleges that defendants failed to pay their debt under the note according to its amended terms and defaulted on it. It alleges that demand for payment was made upon defendants, but they failed to pay. The complaint alleges that plaintiff was the holder and owner of the note and that no part thereof had been paid except the principal sum of $6999.97, and several interest payments aggregating $24,088.07, for which defendants had been credited. The complaint alleges that a schedule of payments that were made and amounts paid is attached to the complaint, although no schedule of payments is attached to the complaint in the record.
¶ 7 The complaint alleges that defendants owe plaintiff the sum of $93,000.03, “with interest at that certain rate of interest announced from time to time as its Prime Rate by Bank One N.A. (and its successor bank, J.P. Morgan Chase N.A.) (the ‘Prime Rate’), and after September 30, 2001, the Prime Rate plus 200 basis points (the ‘Interest Charge’) percent per annum from September 30, 2001 to the present, on the principal outstanding and unpaid.” The complaint prays that judgment be entered against defendants “in...
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YL Chi. Fund, LLC v. 5035 N. Lincoln Ave., LLC
...judgment is comprised of two figures and two figures only: principal plus interest. Plaintiff cites to several Illinois cases, including Cole v. Davis, which confirm that a confession of judgment provision is enforceable even if it includes a variable interest rate. See Cole v. Davis, 63 N.......
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Janssen v. Bri Holding, LLC
...under Article 3.3 See In re W-S Assocs., No. 94-B-21227, 1996 WL 691347, at *7 (Bankr. N.D. Ill. Nov. 26, 1996); Cole v. Davis, 63 N.E.3d 946, 958 (Ill. App. Ct. 2016). B. Plaintiff Is Entitled To Enforcement Of The Note Unless Defendant Can Establish A Defense Or Claim In Recoupment Articl......