Court Opinion

ID: 6335083
Source: CourtListenerOpinion
Date Created: 2022-04-26 18:06:49.97265+00
Date Added: 2024-06-11T09:23:48.114594
License: Public Domain

STATE OF LOUISIANA

                             COURT OF APPEAL

                               FIRST CIRCUIT

                              NO. 2021 CA 1277

                      GULFCO OF LOUISIANA, LLC, D/B/A
                          TOWER LOAN OF CUT OFF

                                  VERSUS

u"        ASHLEY B. CHERAMIE, A/ K/A ASHLEY CHERAMIE
                          AND NICHOLAS CHERAMIE

                                        Judgment Rendered:   APR 2 6 2022

       APPEAL FROM THE SEVENTEENTH JUDICIAL DISTRICT COURT
                   IN AND FOR THE PARISH OF LAFOURCHE
                             STATE OF LOUISIANA
                            DOCKET NUMBER 133694

             HONORABLE STEVEN M. MILLER, JUDGE PRESIDING

     Jessica L. Greber                  Attorneys for Plaintiff A
                                                                - ppellant
     Shreveport, LA                     Gulfco of Louisiana, LLC d/ b/ a
                                        Tower Loan of Cut Off

     Ashley B. Cheramie                 Defendant -Appellee,
     Golden Meadow, LA                  In Proper Person

     Nicholas Cheramie                  Defendant -Appellee,
     Golden Meadow, LA                  In Proper Person

                BEFORE: McDONALD, LANIER, AND WOLFE, JJ.
McDONALD, J.

      This is an appeal from a judgment in favor of the borrower after a trial on the

merits regarding two check loans.    After review, we reverse and render judgment in

favor of the holder.

                       FACTS AND PROCEDURAL HISTORY

      Gulfco of Louisiana, LLC d/ b/ a Tower Loan of Cut Off (Gulfco), is the holder

of two loans owed by Ashley B. Cheramie.         The loans resulted from two "    check

loans" made out to Ms. Cheramie for $ 2, 503. 93 each, which were mailed to Ms.

Cheramie as a solicitation. Ms. Cheramie deposited the checks at her bank to borrow

the money on December 31, 2015 and April 26, 2017. Ms. Cheramie made most of

the payments on the first check loan, leaving a principal balance of $223. 18       due,

plus interest. Ms. Cheramie made no payments on the second check loan.

      Thereafter, on September 25, 2017, Gulfco filed suit against Ms. Cheramie

and her husband, Nicholas Cheramie. Gulfco maintained that Ms. Cheramie owed

an unpaid balance of $223. 18 on the first check loan, together with 31. 65 percent

interest per annum for one year starting on April 3,      2017, 18 percent per annum

thereafter, until paid in full, as well as costs and attorney fees.   On the second loan

Gulfco maintained that Ms. Cheramie owed an unpaid balance of $ 2, 897. 43,

together with 31. 65 percent interest per annum for one year starting on September

139 20179 18 percent interest per annum thereafter, until paid in full, plus $ 10. 50   in

late charges, as well as costs and attorney fees.      Gulfco attached copies of both

checks signed by Ms. Cheramie and processed by her bank, along with lost note

affidavits from Gulfco' s branch manager, attesting that the documents were true and

correct   copies.
                    Gulfco maintained that the debts were incurred during the

Cheramies' marriage and were a community obligation. Gulfco prayed for judgment

in its favor against Ashley and Nicholas Cheramie for the debts, including interest,

late charges, costs, and attorney fees.

                                            K
        Nicholas Cheramie answered the petition,                     generally denying most of the

allegations.     In his answer to the request for admissions of fact, Nicholas Cheramie

denied that the parties had a community of acquets and gains at the time the loans

were taken out and maintained that the parties had a prenuptial agreement.                          The

prenuptial agreement between Ashley and Nicholas Cheramie, dated January 19,

2005, was attached.

        Ms.    Cheramie       answered the petition,            generally admitting most of the

allegations.     She maintained that she and Nicholas had a prenuptial agreement in

place, that Nicholas had no knowledge of the note, and that he did not sign the note.

She admitted the amount due on the first note was $ 223. 18, with interest at 31. 65

percent for one year beginning April 3, 2017, and thereafter at the rate of 18 percent

per annum, until paid in full, and for all costs and reasonable attorney fees as set by

the court.     Ms. Cheramie admitted that the amount due on the second note was

 897. 43, 1 together with interest at the rate of 31. 65 percent per annum for one year

beginning September 13, 2017, and thereafter at the rate of 18 percent per annum,

until paid in full, along with $10. 50 in late charges, all costs, and reasonable attorney

fees set by the court.

        Gulfco filed a motion for summary judgment asserting that it was entitled to

a judgment against Ms. Cheramie as a matter of law. Gulfco attached copies of the

two check loans signed by Ms. Cheramie, along with lost note affidavits from its

branch manager certifying that the documents were true and correct copies and were

a reproduction of its records maintained on file in the course of its business. Gulfco

also attached an affidavit of the correctness of the account from its branch manager,

and an affidavit asking for attorney fees in the amount of 25 percent of the unpaid

debt after default.

1 This appears to be a typographical error as the balance stated in the petition was $ 2, 897.43.

                                                       3
         The summary judgment was apparently denied, as the matter proceeded to a

trial on the merits against Ms. Cheramie.'               Gulfco was the only party present at the

trial.   Gulfco introduced copies of the two check loans signed by Ms. Cheramie into

evidence.    Gulfco' s branch manager testified that the original check loans were

deposited at Ms. Cheramie' s bank and destroyed. At the close of the trial, the trial

court found that Gulfco had presented insufficient evidence of the loans and denied

Gulfco' s claims.        The trial court signed a judgment in favor of Ms. Cheramie and

against Gulfco on June 1, 2021. Gulfco appealed that judgment.

         Gulfco makes the following assignment of error on appeal.

                The trial court erred in finding that there was insufficient
         evidence to support enforcement of the instruments sued upon, and by
         failing to accept the reproductions of the instruments as " prima facie
         proof of [their] contents with the same force and effect as though the
         original    document[ s]       were      produced,"        pursuant   to [   La.   R.S.
         13: 3733. 1C].      The     trial    court' s   decision    imposes    an    additional

         evidentiary burden upon financial institutions to show an apparent
          chain     of    custody"     when                  enforcement       of     negotiable
                                                  seeking
         instruments.      This additional burden of proof is not required or even
         contemplated under the provisions of [ La. R.S.                  13: 3733. 1].     More
         importantly, there is no "          chain of custody" rule for civil matters in
         Louisiana.

                                              DISCUSSION

         Questions of law are reviewed de novo.             City of Baton Rouge/Parish of East

Baton Rouge v. Myers, 2013- 2011 ( La. 5/ 7/ 14), 145 So. 3d 320, 327.                       The issue

herein is whether the trial court correctly interpreted and applied the law. Harris v.

Metropolitan Life Ins. Co.,          2009- 0034 (La. App. 1 Cir. 2/ 5/ 10),         35 So. 3d 266, 273.

         A check loan is a pre -approved loan offer made through a home solicitation

by mail. When Ms. Cheramie endorsed the checks and deposited them into her bank

account, she created loans that must be repaid pursuant the terms described in the

check loan offer disclosures, which were attached to the check.                           See La. R.S.

9: 3541. 1A(2).

z The record before us does not contain a ruling on the motion for summary judgment, nor does it contain
a dismissal of the claims against Nicholas Cheramie.
       The front of the check loans at issue herein include a warning in accordance

with La. R.S. 9: 3541. 1: 3

       WARNING: THE CASHING OF THIS CHECK WILL ENROLL
       YOU IN A PROGRAM OR A LOAN, OR WILL CAUSE YOU TO
       BE BOUND TO REPAY THE LOAN OR PURCHASE GOODS OR
       SERVICES WHICH MAY COST YOU ADDITIONAL MONEY.
       PROPER ENDORSEMENT REQUIRED. NON -TRANSFERABLE.

       The back of the check loans above the borrower' s signature line signed by

Ms. Cheramie states:

       BY ENDORSING THIS INSTRUMENT YOU AGREE TO REPAY
       THIS LOAN ACCORDING TO THE TERMS OF THE CONSUMER
       PROMISSORY              NOTE         AND       DISCLOSURE            STATEMENT
       ACCOMPANYING THIS CHECK WHICH YOU ACKNOWLEDGE
       RECEIVING AND WHICH PROVIDES YOU WITH ADDITIONAL
       CONTRACT           TERMS        IN   CONNECTION             WITH      THIS     LOAN
       TRANSACTION. INCLUDING AN ARBITRATION AGREEMENT.

The check loans also include a disclosure form page that was attached to them, and

which provides the terms of the loans.

        Louisiana Code of Evidence article 901A provides that authentication or

identification is satisfied by a showing that a matter in question is what a proponent

claims.     Authentication can be satisfied by the testimony of a witness with

knowledge. La. C. E. art. 90113( 1).        Louisiana Revised Statutes 13: 3733. 113 provides

that any financial institution may reproduce any of its original records used by such

financial institution during the course of its regular business activities and may

thereafter destroy the original record in the regular course of its business activities.

Additionally, La. R.S. 13: 3733. 1G( 2) provides that a reproduction of a check that

has been destroyed by a financial institution in the regular course of its business

activities shall be deemed to be an original of such check in a judicial proceeding or

3 La. R.S. 9: 3541. 1E provides that such a check shall contain the following language as a conspicuous
caption: WARNING: THE CASHING OF THIS CHECK WILL ENROLL YOU IN A PROGRAM OR A
LOAN, OR WILL CAUSE YOU TO BE BOUND TO REPAY THE LOAN OR PURCHASE GOODS OR
SERVICES WHICH MAY COST YOU ADDITIONAL MONEY.

                                                  5
action involving a claim based on or involving such check.'                        Louisiana Revised

Statutes 13: 3733. 1C provides that reproductions made pursuant to that statute shall

be received as prima facie proof of its contents with the same force and effect as

though the original document were produced, and shall be deemed authentic for all

purposes, thereby satisfying the requirements of La. C. C. art. 901.

        Gulfco attached copies of the signed check loans, lost note affidavits, and an

affidavit of correctness of account to its petition. Gulfco' s branch manager, Erica

Terrebonne, testified at trial regarding the amount of the check loans, the payments

made, and the balances due. Gulfco introduced copies of the signed check loans and

payment statements into evidence at trial.

        Ms. Terrebonne testified that Gulfco was the holder of the check loans, and

the check loans were payable to Ms. Cheramie. Ms. Terrebonne testified that Ms.

Cheramie endorsed the check loans and then deposited them into her State Bank &

Trust account. She testified that Gulfco did not get the original signed check loans

and disclosure statements back because they were destroyed by Ms. Cheramie' s

bank; that Gulfco received copies of the endorsed check loans from State Bank &

Trust; and that true and correct copies of the signed check loans and disclosure

statements were kept in the regular course of Gulfco' s business. Ms. Terrebonne

testified that Ms. Cheramie made most of the payments on the first loan, but left a

balance of $223. 18 unpaid, and was therefore in default on the first loan under the

4 In order for a document to be a negotiable promissory note, it must meet the requirements of La. R.S.
10: 3- 104. These are ( 1) be signed by the maker or drawer; ( 2) contain an unconditional promise or order
to pay a sum certain in money; ( 3) be payable on demand or at a definite time; and ( 4) be payable to order
of bearer. Dixie Web Graphic Corp. v. Sharp, 619 So.2d 1173, 1175 ( La. App. 1 Cir. 1993).

                                                     ON
terms of the         contract.     Ms. Terrebonne testified that on the second loan, Ms.

Cheramie made no payments, and the loan was accelerated upon default.                                      Ms.

Terrebonne testified that the balance due on loan number two was $ 2, 514.43. 5

          After de novo review,            we find that Gulfco clearly presented sufficient

evidence of the check loans and that the trial court legally erred by finding otherwise.

Thus, we reverse the trial court judgment and we render judgment in favor of Gulfco.

                                             CONCLUSION

          For the foregoing reasons, the trial court judgment denying all relief prayed

for by Gulfco of Louisiana, LLC d/ b/ a Tower Loan of Cut Off is reversed, and

judgment is rendered in favor of Gulfco of Louisiana, LLC d/b/ a/ Tower Loan of

Cut Off and against Ashley B. Cheramie in the amount of $223. 18, with interest at

the rate of 31. 65 percent per annum for one year beginning April 3,                             2017,     and

thereafter at the rate of 18 percent per annum, and in the amount of $2, 514. 43, with

interest at the rate of 31. 65 percent per annum for one year beginning September 13,

2017, and thereafter at the rate of 18 percent per annum, and for $ 10. 50 in late

charges, and for attorney fees of $684.40.6 Costs of this appeal are assessed against

Ashley B. Cheramie.

          REVERSED AND RENDERED.

5 The payoff statement for the second check loan shows that the total to pay off the second check loan was
calculated with a beginning balance of $3, 150. 00, which included a finance charges of $646.07. After Ms.
Cheramie defaulted on the second check loan and the loan was accelerated, the finance charge was refunded,
leaving a balance of $2, 503. 93. A late charge of $10. 50 was added, for a total $2, 514. 43 payoff balance.
6
    Attorney fees are calculated herein at 25 percent of the unpaid balance due on the loans, $ 223. 18   on the
first loan and $ 2, 514.43 on the second loan, for a total unpaid balance of $2, 737. 61.