PAYDAY TODAY INC v. HAMILTON. 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 regarding the pleadings and also 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 because:

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

II. If the test court erred in giving summary judgment on Hamilton’s claim underneath the Fair business collection agencies tactics Act.

III. Perhaps the test court erred in giving judgment for Hamilton regarding the defendants’ counterclaims.

IV. Whether or not 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 a payday lender, 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, like the $125.00 principal plus an $18.75 solution fee, within fourteen days through the date of this loan. As protection for the loan, Hamilton offered Payday by having a check that is post-dated $143.75. Whenever Hamilton’s check had been returned to Payday, Hall mailed her a page demanding the amount of the check, in conjunction with a $20.00 returned check cost and $300.00 in lawyer costs. The page claimed that payment among these quantities ended up being essential for Hamilton to prevent a lawsuit. Especially, the page reported in pertinent component:

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

Please be encouraged that this workplace was 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 safety for the loan when you look at the number 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 fulfill the mortgage. You have got didn’t make re re re re payment towards the loan provider as agreed, and upon presentation, the banking organization by which it absolutely was drawn would not honor your check. You have got been formerly notified because of the loan provider of one’s returned check while having taken no action to solve the situation.

IF YOU’D LIKE TO RESOLVE THIS THING WITH OUT A LAWSUIT, this is the time to use it. To do this, you have to spend the next quantities, (1) the complete number of the check plus, (2) a $20 returned check charge, and (3) lawyer costs of $300. This re re re payment needs to be in the shape of a cashier’s money or check purchase payable to Attorney Edward R. Hall. We may file suit immediately, in which you may be liable for the following amount under I.C. В§ 24-4.7-5 if you fail to pay in full the amount due within ten days from the date of this letter et seq.; (1) the total amount of the check; (2) a twenty buck returned check cost; (3) court expenses; (4) reasonable lawyer costs; (5) all the other reasonable expenses of collection; (6) 3 x (3x) the amount of the verify that the face area number of the check had not been more than $250.00, or (7) in the event that face number of the check ended up being $250.00 or higher, 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 if she was found to have presented her check in a fraudulent manner that she could be liable for various damages.

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

a. Hall threatened ․ to file case against Hamilton that could demand damages in overabundance what the defendants are allowed to recoup under I.C. 24-4.5-7-202, therefore breaking I.C. 24-4.5-7-410(b), and Payday caused this danger to be manufactured, therefore breaking I.C. 24-4 online payday NE.5-7-410(b).

b. Hall made misleading and misleading statements to Hamilton ․ concerning the quantity the defendants could recover for a little loan, therefore 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 little 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 produced, 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 manufactured, 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 ag e) that Payday had no right to get, get, or retain any principal, interest, or other costs 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 further relief as the court deems simply and equitable.” Id.

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