Opinion ID: 1763556
Heading Depth: 2
Heading Rank: 3

Heading: Category Six

Text: Finally, we address the Bank's contentions regarding the transaction at issue, specifically, Campbell's affidavit testimony that the loans issued by The Citizens Bank and the debt restructuring at issue facilitated the operation of Alafabco, Inc., which did business affecting interstate commerce, and directly engaged in interstate commerce, including contract work in North Carolina and the state of Tennessee, as demonstrated by the attached records. This testimony touches on a valid consideration, and, if supported by the record, could afford a basis for arbitrability. This is so, because it suggests that part of the money specifically involved in the debt restructuring was used to finance operations in North Carolina and Tennessee. In that connection, the record contains four invoices, three of which evidence interstate transactions. In particular, Alafabco invoice 676 in the amount of $39,574.36, dated August 21, 1995, is addressed to Champion International, Main Street, Canton, NC. The subject of invoice 676 is Doctor Blade Maintenance, Canton Mill, and the invoice includes an itemization of charges for materials, labor, lodging, and travel. Alafabco invoice 681 for $9,209, dated August 18, 1995, bears the same address. The subject of invoice 681 is the installation of a fan, and the prices are itemized as in invoice 676. Alafabco invoice 685 for $11,500 is addressed to Champion International, at its Courtland, Alabama, facility. Alafabco invoice 796, dated December 20, 1995, is addressed to SCA Services, 6919 Flagstone Drive, Ooltewah, TN, and is in the amount of $4,000. The subject of invoice 796 is Agusta Newsprint Doctor Blade maintenance. The record further contains an instrument dated August 23, 1995, evidencing the loan of $31,659.49 from the Bank to Alafabco, namely, Loan Number 3068814. The instrument specifically references invoice 676. The maturity date of that loan was November 21, 1995, at which time a single payment of all principal and interest [was] due. The record contains a similar instrument dated August 31, 1995, evidencing the loan of $21,130.01, namely, Loan Number 3068897. Loan Number 3068897 specifically referenced invoice 681 and invoice 685, and exhibited a maturity date of November 29, 1995. On that date, a single payment of all principal and interest [was] due. These loans apparently financed the transactions evidenced by invoices 676, 681, and 685. However, those projects all occurred in 1995, three years before the occurrence of any of the events made the basis of Alafabco's complaint or of the alleged defaults that precipitated the debt restructuring. There is no evidence indicating that Alafabco defaulted on either of those loans. Thus, for all that appears, those transactions had nothing to do with this controversy. In other words, the Bank made no showing as to what portionif anyof Loan Number 3068814 or Loan Number 3068897 remained unpaid at the time of the debt restructuring. It made no showing as to what portionif anyof the restructured debt was attributable to the 1995 loans. Having thus failed to show the quantity and quality of involvement of the North Carolina and Tennessee projects with the subject transaction, it showedat mosta mere proximity of [the subject transaction] to contracts substantially affecting interstate commerce. Sisters of the Visitation, 775 So.2d at 767. On the state of the record, in other words, the 1995 projects are wholly separable from the subject transaction. Id. Moreover, under Sisters of the Visitation and its progeny, the simple fact that loan proceeds are `mobile' does not require the conclusion that all loan transactions are inherently interstate in nature. Alternative Fin. Solutions, LLC v. Colburn, 821 So.2d 981, 986 (Ala.2001). Compare American Gen. Fin., Inc. v. Branch, 793 So.2d 738, 747 (Ala.2000), cert. denied, 534 U.S. 949, 122 S.Ct. 342, 151 L.Ed.2d 258 (2001), in which evidence was presented that indicated that the relevant loan proceeds actually moved in interstate commerce, as did the payments. The Bank, however, made no showing that proceeds, or payments, moved in interstate commerce, that is, it made no showing of arbitrability under the fourth Sisters of the Visitation factor (subsequent movement across state lines).