Leasing News is a web site that posts information, news, and entertainment for the commercial leasing and finance industry. The News Edition is updated Monday, Wednesday and Friday.
A press release on Thursday announced Dwight Galloway, CLP, former head of LEAF
A full report in Leasing News' Monday edition.
#### Late News ############################################
Thursday, June 2, 2011
######## surrounding the article denotes it is a “press release”
and was not written by Leasing News nor information verified, but from the source noted. When an article is signed by the writer, it is considered a “by line.” It reflects the opinion and research of the writer. It is considered “bias” as it is the writer’s viewpoint.
UNLICENSED LENDER AND SECURITIZATION
By: Thomas E. McCurnin*
In yet another blow to lenders in California, the California Court of Appeals ruled last month that an unlicensed lender, and its fractionalized assignees, are liable to repay illegal interest, including points. By way of backdrop, lenders doing business in California making more than one loan a year must be licensed by the Department of Corporations as a Financial Lender, or if a real estate loan, the loan needs to be arranged by a licensed real estate broker. Since this case was a real estate loan, the applicable exemption was the Department of Real Estate Broker’s license, not the Financial Lender’s law, but as a usury case, the case applies to any unlicensed loan.
The case is Creative Ventures, LLC v. Jim Ward & Associates, 2011 WL 2119698 (California Court of Appeal May 31, 2011). As is the case with many Appellate decisions, this is a mixed bag for the lender and borrower.
Facts of Case
Creative Ventures borrowed $3mm on four notes from an unlicensed lender, Jim Ward & Associates (JWA). The interest rate was around 10% but if the points were added to the principal, the rate was well above the 10% cap in California. Further complicating the issue was the fact that the note was fractionalized into numerous pieces, so the individual assignees claimed that none of them received illegal interest. Another complication was the fact that JWA represented in written materials that it was licensed, when it was not. The trial court also found fraud. Finally, the trial court ruled that the lenders were simply “mistaken” and therefore the court did not treble the interest.
Notwithstanding the favorable rulings, the trial court tagged the lender for almost $500,000 plus attorney fees.
Both parties appealed.
There were four issues on appeal.
1. First, does illegal interest include both the stated amount and the points? The trial court ruled that it did.
2. Second, were the investors “holders in due course” and therefore not liable for usury? The trial court ruled the investors were not liable.
3. Third, was JWA liable for fraud since it advertised that it was licensed? The trial court ruled that it was.
4. Fourth, was JWA liable for treble damages? The trial court ruled that it was not, because of its mistaken belief.
The Court of Appeal Holding
First, illegal interest includes both the stated interest charge and any points. Thus, all the loans were illegal and all interest had to be refunded
Second, the investors were not “holders in due course” since the note was not endorsed, the investors were not entitled to any portion of interest. Although the investors argued intent, the Court of Appeals found their mental state was irrelevant. The investors were therefore liable.
Third, JWA’s fraud finding was reversed. Although the representation as to licensing was clearly false, there was no evidence that the borrower was damaged in that he paid more interest as a result of the fraud or would not have borrowed the money.
Finally, the Court of Appeals affirmed the finding that no treble damages would be awarded, as the trial court found that JWA’s belief that it was licensed was credible. While California’s agency supervising this loan, the Department of Real Estate, found that the belief was not credible and a “stealth-like deception,” this finding was not binding on the trial court or the Court of Appeals.
Lessons for the Lender
Bottom line? Get licensed.
Creative Vendurs v JWA Appeal Ruling (11 pages)http://leasingnews.org/PDF/CreativeVentures_vs_JWA_Appeal.pdf
(These ads are “free” to those seeking employment
Free Posting for those seeking employment in Leasing:
All “free” categories “job wanted” ads:
Steve Reid, CLP, Joins Commerce National Bank
Long time leasing veteran, former Leasing News Advisory Board member, Steve Reid, CLP, joins Commercial National Bank as Vice-President/Relationship Officer.
"Steve brings to CNB nearly three decades of leasing experience and many of us know him from his twenty great years at Santa Barbara B&T," Steve Tidland, CLP, Senior Vice-President and Manager at Commercial National Bank said. " Steve will join forces with Bob Robichaud, CLP to implement a marketing program that will make it clear to the leasing/equipment finance world that CNB has money and is looking to actively invest in 'bank credit' transactions in California.
"Both Bob and Steve understand the type of business we are looking for and they will be valuable resources for lessors and brokers, from the preliminary screening of deals, through visiting with your customers when beneficial, to helping inform/educate/train your staff."
Steve was formerly with Nassau Asset Management. Previously he was Marketing Manager/VP of Marketing for LEAF, Third Party Funding/Santa Barbara Bank & Trust since 1989. He started in leasing in 1982 working for Ron Wagner at the original Heritage Leasing Corp. Prior to entering the leasing industry, Steve spent nine years selling computer system for various companies such as Burroughs and Wang Laboratories. This is where he got his first exposure to leasing as he utilized it in the sale of computer systems. He served on the UAEL (now National Equipment Finance Association) Board of Directors.
Steve is available at 714-678-5306 and email@example.com
Leasing Industry Help Wanted
For information on placing a help wanted ad, please click here:
Please see our Job Wanted section for possible new employees.
Letters? We get eMail?
Brendan Messenheimer of AMC Funding, Charlotte, North Carolina, with four Leasing News Alerts, charged with writing a check for $10,587.88 with insufficient funders, was to appear in court...
"Brendan had his attorney postpone his court appearance until June. I did get a chance to talk with the District Attorney. He told me that no one other than myself has pressed charges and that this would be considered a first time felony offense.
“Even if he is convicted for the felony, he would only get probation and has to repay the money over time. If he strikes a deal for a lesser crime, he would have to pay the full amount of the theft and walk free. It's a shame that he continues to get away with this kind of criminal activity."
(After many complaints from brokers and vendors with bounced checks, it is learned Brendon Job Messenheimer and his wife filed Chapter 7 Bankruptcy before other credits came after him and his main company Advanced Med Corp, Greensboro, North Carolina. As of February, he was still doing the same.)
Fourth Alert (includes first three alerts)
Rhonda Polk, Pacific Premier Bank, Nominated
“Why is this article in the leasing news?
“Pacific Premier doesn't have a leasing program, does very little equipment finance, and finances primarily real estate. They don't work with Brokers and are really very tiny as banks go….. “
(Name With Held)
(Leasing News is a "people" oriented news edition. In this regard, we don't just look at presidents of a company, but everyone, and not just in one field or another. If a person is a relative of a leasing or finance person, or involved in any aspect of the financial community and has an interesting story for readers or I think would be of interest to readers, it will get a priority over a press release about securing a new vendor or promoting new software or what I call just a "plain advertisement."
(Leasing News wants to write about people. We also like to write about women. We specially go out of our way to salute women in this business, and as the first president of a Credit Women International Chapter, who also got men involved, I specifically like to salute their contribution.
(I have never met Ms. Polk, but I can tell you she had friends who wanted me to know about her nomination and what a great person she was. I told her I was going to run the story and asked for a photo, and was glad to find an attractive woman, a black woman, too!
(As editor, I thought it was a very good story and was proud to run it.)
(P.S. Asked Rhonda if they did leasing?)
"No we don’t… not currently.
"In the small ticket space, I have been referring my leasing business to Barbara Griffith at So Cal Leasing. She has the type of Business sense and customer respect all leasing industry people should follow. Barbara works quickly and efficiently to get the job done and goes above and beyond to help the client. If LEAF were up and running again, I would put Rich Vohra on that list as well. He is very knowledgeable and his follow up is fantastic.
"For mid-ticket, Kris Dragoo at Innovative Leasing, and Bob Robichaud at Commerce National Bank. Both are direct lenders and I have a ton of respect for them. That goes without saying in Bob’s case. With Kris, Innovative got lucky when they brought her on board."
Rhonda Nicole Polk
"I own all of the cd’s...what a great series…all of them had their own spark!"
LEAF Philadelphia Office
Another Misrepresentation from LEAF?
"I had the honor and privilege of working with Dwight Galloway… 2005 to 2008 and helped LEAF move into their new offices. When they moved in they had both the 14th and 15th floors with the data center on the 14th and managers on the 15th. The high end glass walled data center was built out for a previous tenant (IBM I think) and it would make sense to move the managers down to the 14th floor.
“Besides the extra rent it is terrible for morale to walk through a mostly empty space that was once teeming with activity. That assumes there is any morale left after the layoffs and other changes...
"I was laid off in October 2008 (along with several others in Columbia) as part of LEAF trying to reduce expenses to preserve their funding lines. I would prefer you not attribute this information to me but rather to the ubiquitous..."
"unnamed reliable source"
"My brother has created and is running a new show on NBC (coming out this fall) at 8:30 on Wednesdays. It is called 'Free Agents' and it will be a 1/2 hour comedy.
"From the NBC site 'This crooked workplace/romantic comedy written by John Enbom (Party Down) and directed by Emmy Award winner Todd Holland (Malcolm in the Middle) proves you can try to put yourself back out there, but sometimes what you need is right in front of you. Even if it's a really bad idea.'
"For the few die-hard fans of Party Down (http://www.starz.com/originals/PartyDown) that John Enbom created and wrote, there is hope in a new equally off-color comedy at NBC."
Chris Enbom, CEO
Ted Nuggett: Current State of Mortgage Lending
"Ted Nuggett video is hilarious. How about that tie? Is there a way that you can send me that piece individually? I have a lot of friends in lending that would love to see Ted.
Archives, May 18, 2007
(April 24, 2008 he was named President---
"Please know that we have an incredible team at Balboa. It is not because of me, but because of the collective efforts of everyone at Balboa Nation. We make strides every day…”
"One hire at a time
"I can’t say enough about our people."
"Our client leased equipment through Colonial Leasing Company in 2000. She paid the equipment off several years ago but the UCC-1 was never satisfied. I read articles on your website which indicate that GE Capital bought Colonial Pacific Leasing and that GE Capital exited the leasing business as well. Do you have any information as to who we would contact to secure a UCC 3 from Colonial Pacific Leasing? Our client is selling the property. Thank you for any assistance you can provided."
Rebecca J. Schriver, FRP, CP
(There should be no Colonial Pacific UCC's active at all at this point as UCC's expire after five years, unless both parties agreed to a new UCC.
"If you are getting this information from an agency, they are trying to make some money from you. Here is a story on one, evidently no longer in business.
(Colonial Pacific Leasing ( 12/2001) to close Portland office, move to Chicago to be under one roof with other GE purchases, 500 brokers paired down to top 75 producers/250 employees effected. No more business at Portland operation after December 14th. Merry Christmas.
History of Colonial Pacific:
Leasing News Help Wanted Ad Pricing
Charlie Chan Family
The Honolulu Detective was not only wise, but prolific. Here is his entire family. While his number #1, #2, #3, and #4 sons appeared in movies with him, interesting none of his daughters went on cases along with him, to my memory.
Please send your sayings or observations you think the great Charlie Chan would say. Prizes!!
(This ad is a “trade” for the writing of this column. Opinions
Leasing News: Special Summer Movie Edition
Summer may take its time coming around, but when it does it just about floods theaters with contenders for the crown of blockbuster of the season. As the weather warms up, we recommend a string of classic summer-themed movies (all available on Netflix) to keep viewers cool and ready for the season’s upcoming hits.
Summer of ’42 (Robert Mulligan, 1971): Almost a decade following “To Kill a Mockingbird,” Robert Mulligan directed another nostalgic tale about the lessons of growing up, focusing this time on a boy’s journey into adulthood. Told as a dreamy remembrance by the now-grown main character, the story takes place shortly after the country first entered World War II, focusing on the lonely war bride named Dorothy (Jennifer O’Neill) who becomes an object of fascination for Hermie (Gary Grimes), a teenager who’s spending the summer with his family in a nearby home. Their paths cross in an unexpected way when tragic news arrive from the front, and Hermie’s life isn’t the same afterwards. Crafted with charm and delicacy, this is one of the most sensitive coming-of-age sagas.
Summer Rental (Carl Reiner, 1985): After years of scene-stealing supporting roles, John Candy finally got his own starring vehicle in this enjoyable family comedy. Candy plays Jack Chester, a frazzled air traffic controller who takes some time off from his everyday life and takes his family to a sea resort in Florida. Unfortunately, this vacation turns out to be every bit as stressful as work, with everything from repairing the rental place to tanning at the beach going hilariously wrong. Things seem dire until a sailboat race with an obnoxious yatchsman (Richard Crenna) give Jack a chance to prove his worth to his family. Directed by comic veteran Carl Reiner ("The Jerk"), this is a perfect showcase for Candy's lovable persona and as pleasing as a day at the beach.
Stand by Me (Rob Reiner, 1986): Best known for his horror stories, Stephen King was also the author of this warm, affecting portrait of childhood friendship, which has become one of the most fondly remembered movies of the 1980s. Set in the fictional Oregon town of Castle Rock, the movie charts the events that changed the lives of a group of teenagers over the course of one Labor Day weekend in 1959. Gordie (Wil Wheaton), Chris (River Phoenix), Teddy (Corey Feldman) and Vern (Jerry O'Connell) are young friends who go on a hike in the woods seeking fame and instead finding comical and sometimes dark life lessons. A keenly observed comedy-drama, directed by Rob Reiner ("This Is Spinal Tap") and featuring a cast that includes Kiefer Sutherland, John Cusack and Richard Dreyfuss.
Do the Right Thing (Spike Lee, 1989): Never one to shy away from controversial topics, director Spike Lee had perhaps his most explosive hit with this explosive look at racial tensions during one very hot summer day in a Brooklyn neighborhood. The distinctive writer-director also stars as Mookie, the local delivery boy and one of the characters who take part in a simmering cauldron of racial tensions that reaches a boiling point over a heated argument between the African-American community and Sal (Danny Aiello), the neighborhood's Italian pizzeria owner. For an invigoratingly provocative slice of summer in the city, viewers can't go wrong with this volatile, vibrantly stylized mix of comedy and tragedy, with an exceptional ensemble that includes Giancarlo Esposito, Ossie Davis, Ruby Dee and John Turturro.
(500) Days of Summer (Marc Webb, 2009): Summer here is the name not just of the season, but of the quirky young woman (played by Zooey Deschanel) with whom Tom (Joseph Gordon-Levitt) falls in love in this brisk romantic comedy. Looking back at their 500 days of ups and downs, Tom, a greeting card writer who dreams of becoming an architect, remembers the happiness and heartbreak of love. Even though the scenario is familiar to anyone who's seen modern romantic comedies, director Marc Webb (with great help from his two talented main actors) aims for a blend of quirky comedy and heartfelt melancholy that should strike a chord with any viewer who's ever taken a ride on the rollercoaster of love.
Classified Ads---Job Search
Los Angeles, California (Baldwin)-- Adopt-a-Dog
Impound Number: A4286258
(this dog needs help and love and care. Looks like
If you are interested in adopting one of our shelter pets, it is necessary that you come in person to the appropriate animal shelter housing that animal. Our animal care staff will tell you everything we know about the animal.
4275 N. Elton
Adopt-a-Pet by Leasing Co. State/City
Adopt a Pet
(Leasing News provides this ad as a trade for investigations
Getting Approved at EagleRock Leasing
(This is fiction; all names, places, circumstances are fictional.)
Larry walked into the credit manager’s office EagleRock Leasing, Chicago, Illinois,. Bob looked up from his desk and saw him. The office was very neat, desk extra clean, not much on it except for a small computer, pen set, a frame with a photo he could not see, and a manila folder. The walls were quite different, no room left as there were many photographs on the two walls---camping, outdoors, in military uniform with other soldiers, and some certificates he could not read from where he was entering. The third was a large window and you could see the Lake Shore besides Lake Michigan.
Frank came in next, and Bob immediately stood up quickly as he entered the room, almost “at attention,” as he was experiencing a “superior officer” in sight. Both were standing straight tall. Excellent posture. Frank was six-four. Bob was Larry’s height, five- ten and a half. Bob had a crew cut, real close, very much out of style, very dark hair, almost as if he dyed it jet black; military cut. Frank’s hair was very neat, long as he had a lot of dark hair, thick hair, almost as if he had “gel” in it, as it also parted with a wave to the side in the front--- very Spanish looking with a streak of white in it. It was very neat, but long, especially compared to Bob’s military crew cut.
Larry’s hair was longer, more dirty than black, with white streaks in it, and he had passed up a hair cut a few weeks ago. His hair was almost like he had been caught in a wind storm. Yes, it looked like he needed a hair cut, especially in contrast to the two men.
Both Bob and Frank looked like they had “hand pressed” shirts and trousers. Larry was rumpled and obviously didn’t care (although his wife was a fantastic dresser, Larry was the opposite.) He certainly was the odd man out in the group of three.
Bob first shook Larry’s hand, then said in a louder voice than normal, as if they were not almost standing near each other, but far away. ” Glad to meet you, Colonel.”
Larry was surprised as he had never told Bob about Frank’s military background.
“My pleasure, Captain,” Frank said. Larry had told Frank about Bob being a Marine in the Viet Nam, and retired a Captain. Usually you retire rank higher, but it depends on the length of service, or in Frank’s case, he turned it down.
“Call me Bob.”
“You can address me as Frank.”
All sat down. Larry and Frank in dark wood arm chairs in the relatively small office, but had a magnificent view of the lake. Sparse would be a good description as it had a small wooden round table that matched the two chairs with two other chairs around it, same style and color, but without arms.
“I was down at the navy base and looked your record up," Bob said. “I saw a Silver Star, two purple hearts, and a number of commendations. You saw a lot of action.”
Frank never talked about Viet Nam or his Special Forces Airborne unit Larry was quite surprised he didn’t know this about his partner in San Francisco Valley Leasing. Frank normally was quiet except at 5pm when he climbed up the stairs to the second floor and Larry’s office every work day to have a brandy and cigarette or two or three.
His wife didn’t like him smoking. He even had a shower built in his warehouse on the first floor as she once told him he smelled the smoke on him. He told her he installed the shower as he would often go for a run in the afternoon. Whether she believed him or not, don’t know. Frank ran five miles or more every morning, even on Sunday’s, which was a contention with his wife as his missed Mass with the family. He seemed to attend only on religious holidays.
Frank’s family came to California with the first Spanish mission army and stayed. They were granted most of the San Francisco Peninsula to Salinas, and this day still had land in San Mateo County and Santa Clara County. Frank lived in Los Altos Hills, on the City of Palo Alto border, in an area where the houses all had four car garages, some five, there were several with a ten car garage, one with twenty-five cars as he collected older vehicles, and Frank told him about one neighbor who had a six car garage plus one free standing that housed his $500,000 Bugatti that he drove four miles to work every day. He reportedly also wore a $250,000 watch from Switzerland that he liked to show off.
Frank knew many of them as he ran every morning in the neighborhood, met others who were doing the same, even stopped and talked to some. Frank was an avid tennis player, belonged to the Palo Alto Country Club, but he never talked about his time in the military or Viet Nam.
“I see by the photo’s on the wall you saw a lot of action, too. I also see a lot of camping photo’s.”
“My favorite is getting away with the family and friends, fishing, hiking. I take my family, including my two sons. We go to Yosemite, Montana, Colorado.”
Frank looked at the many photo’s on the wall in simple black frames, all the same border, but different sizes. One had a group of photo’s as a montage.
“Do you mind if I smoke?” Bob said, but taking a pack from his shirt pocket before the answer was made.
“Not at all,” Frank said. “What kind?”
“Chesterfield. Would you like one?”
A pack was first pointed in Frank’s direction as he took one, and Bob at the same time, opened a desk drawer and took out a small glass ashtray with a US Marine emblem. It was a 4” x 3” rectangle glass with the four corners to hold a cigarette with a worn silver/gold Marine emblem in the middle over a faded red background.
Bob leaned over and lit Frank’s cigarette with a shiny metal Zippo lighter also with a US Marine emblem on it. He then flipped it closed, open it again, and lit his own. They both then sat back in their wooden chairs.
Larry just sat through this as if he wasn’t in the room. He didn’t smoke. He had met Bob several times and he just thought he remembered Larry didn’t smoke, so that is why he didn’t offer him a cigarette. The flipping closed of the Zippo lighter before opening it for himself, he thought must be a military salute.
It felt more like several minutes that no one talked. The two just drew smoke from their cigarettes, then exhaled. Larry wasn’t going to speak, although he wanted to. There was something happening between these two men that he could feel, but he didn’t understand it. It wasn’t outright animosity, but he felt something going on, but he couldn’t figure out why.
Bob finally spoke.
“Have you ever been to Kracheh?”
“Officially or unofficially?”
“I read your record at the navy base and it didn’t show you had been to up the Mekong River.”
“And it won’t!”
With that, Frank sat up-right, put his cigarette out.
“Larry says you are the best credit man in the business, and I wanted to meet you, as I am his new partner in his leasing company. I wanted you to know that we are interested in return business, keeping the customer happy, making him part of the family--so they return.”
Bob looked at him as he was wanting Frank to know he was listening closely. It was a serious face, no smile. Intent. Then he spoke, almost like it was a delayed reaction.
“Just was curious,” Bob replied. “I’ve never been to Kracheh.”
With that, Frank stood up. Larry was looking at Bob, then Frank, then the both of them. He didn’t understand what was going on, or what had just happened. He thought they were all going out for lunch and a longer talk, but it was obvious that Frank decided he didn’t like being questioned, and decided to leave.
Frank put out his hand to shake Bob’s, who immediately stood up and shook his hand. Then spoke.
“Please send me your financial statements for the last three years and federal tax returns for my files,” he said as a matter of fact. “You’re company is approved. I need them for my files. ”
He then shook Larry’s hand, and walked them to the door.
When they got into the elevator, Larry asked, “What was that all about?”
“You got the company approved, right?” Frank responded.
That ended the conversation. Frank didn’t say very much, until he had a brandy on the airplane back home. He talked almost all the way back about how he loved California, and why. In detail.
Larry never understood it, and thought about it before Frank’s funeral. Frank developed a cough, then was diagnosised with lung cancer. Went home and died within two and a half months. His brother came into the office, and his oldest daughter, right out of Stanford University. Larry never visited him at his home.
He did arrive at the service an hour and a half early, even before the family. He got an excellent parking spot. He saved a seat for his wife Michelle. He wanted to get their early. He talked to the priest and then those who were setting up the photo’s of Frank and his family, the sign in book, service information, and also wandered around.
“It was almost as strange as my funeral (Larry died at age 56 of a heart attack.) The inside church was not like seats in a row, but were in a large circle, almost like a theater, but it was a Catholic church.
Frank’s family came together, all very well dressed. His accountant, attorney, people from work, some of the customers I knew, and men in Marine uniforms, all standing straight as Frank did, all ages, ranks, and some looked like the uniform were very tight, as if they had not worn them in a long time.
“I told him he had to quit smoking those damn cigarettes, but he always laughed. When it came to my time to speak, I told him how I was missing his late afternoon visits, where we would talk about what had happened that day, and often laugh together.
“When I died, they put my in the ground and everyone threw dirt on my coffin. Even my wife and kids. All my ‘Cal’ fraternity were there. I thought it was funny their throwing dirt on me.
I missed Frank, and wondered what he might say about this Jewish ritual. He probably would have laughed like me. I sure would have loved to have seen him wearing a yarmulke and throwing dirt on me.
“I miss him.”
Previous SF Valley Leasing stories:
Tornadoes leave 4 dead in Massachusetts
More than 500 cities see more homes become rentals
Ted Nugget: Wine
Ted Nugget, news anchor at American Network Television (ANT), offers insights about grapes and vineyards and expressing opinions on popular varietals and wines.
How to Look for a Job When You’re Employed
U.S. wine sales rebound
No. CA. Weather interfering with grape pollination
Aperitifs, a Sip of Europe before Dinner
Napa wine group acquires historic Seghesio winery
Free Mobile Wine Program
Wine Prices by vintage
US/International Wine Events
Leasing News Wine & Spirits Page
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This Day in American History
1692-As the village of Salem was gripped by terror of witches, Massachusetts Bay Colony governor Sir William Phips ordered a special court create on May 217,1692, to expedite judgment of the more than 150 people accused of witchcraft. Unpopular resident Bridge Bishop, first accused in April, was the first on the jailed brought to trail on June 2. At her April examination her accusers—teenaged girls---had collapsed in fits as she appeared but Bishop adamantly denied the charges. “I am not witch—I known not what a witch is.” She was convicted June 2 and hung June 10.
The object is to insert the numbers in the boxes to satisfy only one condition: each row, column and 3x3 box must contain the digits 1 through 9 exactly once. What could be simpler?
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