1z<Y s'. .... ..- ., ^ ^'^^i

IN THE SUPREME COURT OF OHIO

CALVARY SPV I, LLC ASSIGNEE OF : Appeal No. 13-1913BENEFICIAL 01110, INC.,

V.

Appellee,

CONNIE M. GABELMAN, et al.,

Appellant.

On Appeal from the Licking County,Court of Appeals, Fifth AppellateDistrict

Court of Appeals Case No. 13CA0015

MOTION AND MEMORANDUM IN SUPPORT OF MOTION TO STRIKE ANDREPLACE PLEADING OF APPELLANTS

CONNIE M. GABELMAN AND MARK J. GABELMAN

Tliomas L. Gabelman (0018165) (COUNSEL OF RLCORD)3300 Great American Tower301 East Fourth StreetCinciiuiati, OH 45202513.651.6800 (phone)513.651.6981 (facsimile)tgabelxnan!a7fbtl aw.coin

COUNSEL FOR APPELLANTS, CONNIE AND MARK GABELMAN

James Oh, Esq.Javitch, Block & Rathbone LLC1100 Superior Ave, 19th FloorCleveland, Ohio 44114tel. (216) 685-3023fax (216) 525-4929joli,r^ibandr.corrz

COUNSEL FOR APPELLEE CALVARY SPV I, LLCASSIGNEE OF BENEFICIAI, OI-IIO, INC.

631^.^

`4, ts - i ^s^ i >d

,..._ ^,

CLERK OF COURTSUPREME COURuf OF OHIO

MOTION

Appellants, by and through counsel, hereby move this Court to strike and replace the filed

I1ilemorandurn in Support of Jurisdiction, with the Memorandum in Support of Jurisdiction

attached hereto as Exhibit A. Due to an inaclvertent clerical error, the Memorandum as originally

filed, omitted pages one and two which set forth the Statement of the Case and Facts.

Appellants submit the attached Memorandum in Support of its Motion herein.

^ s ^ c ully submitted,

1lomas L. Gabelman (0018165)3a00 Great American Tower301 East Fourth StreetCincinnati, OI-I 45202513.651.6800 (phone)513.651.6981 (facsimile)lgabelmanfbtlaw.com

COUNSEL FOR APPELLANTS, CONNIEAND MARK GABELMAN

MEMORANDUM IN SUl'PORT

Appellants filed its Notice of Appeal and Memorandum in Support of Jurisdiction on

December 5, 2013. Due to a clerical error in assembly of the filing, apparently pages 1& 2 were

inadvertently omitted from such filing. On December 20, 2013, Appellee's counsel advised

Appellants' counsel of such omission (See Affidavit of Counsel Thomas L. Gabelman attached

hereto as Exhibit A.1) and Appellants' counsel immediately transmitted the complete

Memorandum in Support electronically to Appellee's counsel. Appellee has not been prejudiced

by such omission. This was a clerical error which omitted a portion of the Statement of the Case

and Facts, as noted in the Table of Contents. The Statement of the Case and Facts are not a

disputed matter in this proceeding.

On the basis of the foregoing, Appellants respectfully request that Appellants be

permitted to strike and replace the IVlemoranduzn in Support so that the matter may be considered

on the merits.

^1illy subrnitted,

-^.....^-^..^

omas L. . Gabelman (U018165)3300 Great American Tower301 East Fourth StreetCincinnati, OH 45202513.651.6806 (phone)513.651.6981 (facsimile)tgabelmanTd? fbtl aw. c om

COUNSEL FOR APPELLANTS, CONNIEAND MARK GAI3ELM:AN

2

CERTIFICATE OF SERVICE

I hereby certify that a copy of the foregoing Motion to Strike and Replace Pleading was

served this 20th day of December, 2013 by regular United States mail delivery upon thefollowing person:

James Oh, Esq.Javitch, Block & Rathbone LLCJ 100 Superior Ave, 19th FloorCleveland, Ohio 44114tel. (216) 685-3023fax (216) 525-4929johCa2jbandr.com

L. C'rabelman (001$165)

COUNSEL FOR APPELLANTS, CONNIE ANDMARK GABELMAN

IN THE SUPREME COURT OF OHIO

CALVARY SPV I, LLC ASSIGNEE OF . Appeal No.BENEFICIAL OHIO, INC.,

Appellee, On Appeal from the Licking CountyCourt of Appeals, Fifth Appellate

v. : District

CONNIE M. GABELMAN, et al., Cotirt of Appeals Case No. 13CA0015

Appellant.

MEMOIZANDUM IN SUPPORT OF JURISDICTION OF APPELLANTSCONNIE M. GABELMAN AND MARK J. GABELMAN

Thomas L. Gabelinan (0018165) (COUNSEL OF RECORD)3300 Great American Tower301 East Fourth StreetCincinnati, OH 45202513.651.6800 (phone)513.651.6981 (facsimile)t;abelman c r̂,tbtlaw.com

COUNSEL FOR APPELLANTS. CONNIE AND MARK GABELMAN

Audra T. Funk (0073362)Javitch, Block & Rathbone, LLC140 East Town Street, Suite 1250Columbus, OH 431.15614-228-9550 (phone)614.228.2818 (facsimile)AFunk@JBandR.com

COUNSEL FOR APPELLEE CALVARY SPV I, LLCASSIGNEE OF BENEFICIAL Ot-IIO. INC.

EXHIBIT

A^

TABLE OF CONTENTS

Pa2e

EXPLANATION OF WHY THIS CASE INVOLVES A QU-ESTION OFPUBLIC OR GREAT GENERAL INTEREST ..................................................................:...1

STATEMENT OF THE CASE AND FACTS .........................................................................1

ARGUMENT IN SUPPORT OF PROPOSITION OF LAW ................................................3

Proposition of Law 1: Pursuant to R.C. 1343.01, the interest rate applicable to a Note

shall not exceed Eight Percent Per Annum and the Court of Appeals conimitted clear

error in affirming a Judgment on a Note Prescribing an Interest Rate in excess of the

Permissible Statutory Rate . ........... . . .... ..................... ......... . . .... .. .. ........ ........ .... .. .............. 3

Propositioii of Law 2: A Judgment should not have Prospective Application on Equitable

Grounds Where a Usurious Interest Rate 1-Ias Been Charged and a Judgment Creditor

Fails to File an Accounting as Statutorily Required . ...... ......... ......... ......... ..............4

Proposition of Law 3: Relief from Judgment is Timely Sought when a Judgment

Creditor Fai1s to File Statutorily Required Accounting Regarding Such Judgment........ b

CONCLUSION ...... ............................. .................................................. .. ......8

PROOF OF SERVICE ..................................................

APPENDIX Appx. Pa e

Opinion of the Fifth District Court of Appeals tbr Licking County (October 21, 2013) 1

ii

EXPLANATION OF WHY THIS CASE IN'VOLVES AQUESTION OF PU".BLIC OR GREAT GENERAL INTEREST

This case involves a question of public or great general interest because the decision from

the Fifth District Court of Appeals renders effectively meaningless the statutory framework the

General Assembly established with respect to the maximum interest rate that may be assessed on

promissory notes. This Court's review is necessary to define and preserve the most basic due

process rights of consumers throughout the state that enter into agreements either with or without

the protections from potentially predatory lending practices. Permitting a party to use the power

of Ohio courts to enforce and collect judgments which are usurious in nature is a rrianifest

injustice and undermines the integrity of and public confidence in our system ofjurisprudence.

Further, the Court of Appeals erred in not considering or even addressing the equitable

grounds upon which a judgment should be set aside and not prospectively applied.

STATEIVIEIiiT OF Tl<IE CASE AI!'D FACTS

On August 15, 2003 the Appellants executed a promissory note titled "Revolving Loan

Agreement". (Cpmplaint at¶T 1-2.) On March 27, 2006, Plaintiff-Appellee Calvary SPV I,

LLC Assignee of Beneficial Ohio, Inc. ("Appellee") commenced an action, a Complaint for

Money against Defendant-Appellants Mark and Connie Gabelman ("the Appellants").

Appellee's Conaplaint, despite being only five total sentences, set for th the following: (1) that

Appellee was the "holder of a Promissory Note"; (2) that "A copy of the said Promissory Note is

attached hereto", and (3) set forth "the amount due and owing on the Note...". (Complaint atTT

1-2.) The total amount at issue in the Note was $15,000. Appellee's use of the ternt "Note" in

the Coinplaint is significant herein because Appellee claimed, on appeal, contrary to the three

assertions in the Cornplaint, that the instrument at issue is no longer a"note".

Thereafter„ on May 1, 2006, Appellee moved for Default Judgment against the

Appellants. (Motion far Default Judgment filed May 1, 2006) That same day, the Licking

County Court of Common Pleas rendered a default judgment entry against the Appellants "in the

amount of $21,294.33 and interest at the rate of 22.98% per aiuium from Feb 28, 2006."

(Judgment Ent7y, May 1, 2006.)

Appellee began garnishment proceedings against the Appellants to collect on the

Judgment in July 2006. The Appellants filed a Motion for Accounting and Termination of

Garnishment on September 28, 2011. In that motion, the Appellants explained that Appellee had

already garnished $36,730.09 and still claimed that another $13,492.37 was owed. Appellee did

not respond to this Motion for Accounting or file the statutorily required accounting.

Approximately one month later, on October 20, 2011 the Appellants filed a lvotion for Relief

from Judgnzent.

On March 26, 2012, while the Motion,j'or Relief was pending, the Licking County Court

of Common Pleas granted the Motion for Accounting. (March 26, 2012 Judgment Entry) The

accounting at issue was eventually filed on August 27, 2012, almost a year after the original

Motion was filed. (Notice of Filing of Pre and Post Judgment Accountings)

Based on the accounting eventually filed with the lower Court by Appellee on August 27,

2012, the Appellants had paid Appellee $4,234.00 prior to Appellee filing the Complaint at issue.

In addition to this $4,234.00, Appellee has caused to be garnished $36,730.09 f-rom the

Appellants' earnings and accounts. Despite this, Appellee still claims, at the time of the last

accounting, that an additional $16,109.23 is owed on the Judgment at issue. Thus, Appellee

claimed entitlement to more than $57,073 on a $15,000 note.

2

On January 22, 2013, the Licking County Court of Common Pleas filed its Judgmenf

Entry denying Defendants' Ilfotion for Relie,f'from ,Tudgmnt. On October 21, 2013, the Licking

County Court of Appeals affirmed the Court of Common Pleas Judgment.

This appeal arises out of the Fifth Appellate District Court's affirmation of that Judgmnt.

ARGIIMEllTT IN SUPPORT OF PROPOSITION OF LAW

Proposition of Law 1: Pursuant to R.C. 1343.01, the interest rate applicable to aNote shall not exceed Eight Percent Per Annum and the Court of Appealscommitted clear error in affirming a Judgment on a Note prescribing an InterestRate in excess of Ohio's Statutory Rate.

The Court of Appeals erred in affirming the judgment of the Court of Common Pleas

which denied Appellants' Motion for Relief from Judgment.

In order to prevail upon a motion for relief from judgment under Civ. R. 60(B), a party

seeking relief must show (1) a meritorious claim or defense; (2) entitlement to relief under one of

the grounds stated in Civ. R. 60(B); and (3) a timely filed motion. GTE Automatic Electric v.

ARC Industries (1976), 47 Ohio St. 2d 146, paragraph two of the syllabus. In reviewing such a

motion, "equitable principles may be taken into consideration. " Rowlcrnd v. Finkel (Ohio Ct.

App., Lorain County 1987), 33 Ohio App. 3d 77, 79.

In this case, the Appellants fulfilled all three prongs of the parameters set forth in GTE.

Appellee's Coznplaint clearly stated that the instrument at issue was a Promissory Note.

In fact, the Complaint made such assertion no less than three times over the course ofjust five

sentences which comprised the entire substance of the pleading upon which the very judgment

was granted. Specifically, Appellee claims: (1) that Appellee was the "holder of a Promissory

Note"; (2) that "A copy of the said Promissory Note is attached hereto", and (3) set forth "the

amount due and owing on the Note".

Given that the instrument at issue was undeniably a Note, the interest rate applicable to

the Note is provided in R.C. 1343.01 which provides that:

(A) The parties to a bond, bill, promissory note, or other instrument of writing forthe forbearance or payment of money at any future time, may stipulate therein forthe payment of interest upon the anaount thereof at any rate not exceeding eiRhtper cent per annum payable annually, except as authorized in division (B) of thissection.

Despite the clear and unequivocal language of R.C. 1343.01 and despite the clear and

unequivocal language of the Complaint, Appellee usuriously charged the Appellants an interest

rate of 22.98%, which is three times the permissible legal rate.

Furthermore, in addition to charging an excessive and impermissible interest rate,

Appellee has also been compounding the interest charged to the Appellants, again in violation of

Ohio law. Ohio law is quite clear that absent agreement to the contrary, interest on a promissory

must be simple and never compounded. R.C. 1321.57(C)(2); Mayer v. Medancic (2009), 124

Ohio St. 3d 101 at JI6. Promissory notes, such as the one at issue, which state that interest is to

be calculated as a specified rate "annually" do not provide for compounding postjudgment

interest. 1L.fedancic, 124 Ohio St, 3d at Ti 17. As such, the "Annual Percentage Rate" specified in

the Note was not an agreement to compound interest. Despite this clear law, Appellee has

collected more than $40,000 on a $15,000 note from the Appellants.

In light of the foregoing, Appellants have clearly established a meritorious defense with

regard to both the interest rate and the unlawful compounding of interest.

Proposition of Law 2: A Judgment should not have Prospective Application OnEquitable Grounds Where a Usurious Interest Rate Has Been Charged.

Civ. R. 60(B) provides:

On motion and upon such terms as are just, the court may relieve a party or hislegal representative from a final judgment, order or proceeding for the followingreasons: ... (4) the judgment has been satisfied, released or discharged, or a priorjudgment upon which it is based has been reversed or otherwise vacated, or it is

4

no longer equitable that the,judgment should have prospective application;"(emphasis added)

The Appellate Court failed to consider that equitable grounds for relief set forth in

Appellant's appeal. Under principles of equity, a court may order relief from judgment where the

debtor has tendered an equitable amount to the creditor. 61 Oh Jur Interest and Usury § 124

("[A] bill to impeach a judgtnent rendered on a usurious agreement must allege a tender of the

amount due in equity in order to be sufficient."); Bank of Wooster v. Stevens (Ohio, 1856), 6 Ohio

St. 262, 265. ("If the defendants had filed an original bill to impeach the judgment for usury,

such bill would be bad on demurrer, unless it averred a tender of the amount due in equity.")

In the case sub 'ustice, Appellants havetendered far more than an equitable amount to

Appellee in payment for the $15,000 note. It is no longer equitable that the judgment should

have prospective application. In January of 2013, the Appellants had already paid more than

$40,000 in satisfaction of a $15,000 note. Making the matter even more inequitable, had the

2006 judgment been entered with prejudgment and post judgment interest at the rate permissible

under Ohio Statutory Law of 8%, the Appellants would have paid off the entire amount of the

Judgment in June of 2009. Furthermore, the Appellate Court failed to address that Civ. R.

60(B)(4) allows for relief from judgment in the event that "it is no longer equitable that the

judgment should have prospective application." In fact, the Court of Common Pleas failed to

even cite equitable principles at all in its January 2013 Judgment Entry, despite the fact that Civ.

R. 60(B)(4) specifically empowers to set aside a Judgment on equitable grounds alone.

The Courts of Ohio have long recognized that "permitting a party to use the power of the

court to obtain, enforce and collect a default judgment which may be usurious would result in

manifest injustice and undermine the iiitegrity of, and public confidence in, the judicial system."

Society Nat'l Bank v. Radisek, 1991 Ohio App. LEXIS 6021, at *9 (Ohio Ct. App., Cuyahoga

5

County Dec. 12, 1991). The Court of Appeals' decision would permit Appellee to continue to

collect funds from the Appellants until over $57,000 - nearly four times the amount originally

borrowed - has been recovered.

Given the unequivocal language of Civ. R. 60(B)(4), which permits relief from judgment

on equitable grounds alone and the supporting law cited herein, the Appellants have clearly

satisfied the el ementsof the GTE Auto7natic test.

Proposition of Law 3: Relief from Judgment is Timely Sought when a JudgmentCreditor Fails to File Statutorily Required Accounting Regarding Such Judgment.

The Court of Appeals also erred in determining that Appellants failed to seek relief from

Judgment in a timely manner. IJnder Civ. R. 60(B)(4), a movant is required to file a motion for

relief from judgment "within a reasonable time. " When deterniining what constitutes a

reasonable time, courts look to when the relevant basis for seeking relief becomes ascertainable,

not necessarily the time of the original judgment entry. Rowland v. Finkel (Ohio Ct. App.,

Lorain County 1987), 33 Ohio App. 3d 77, 79. In Rowland, the plaintift's filed a complaint to

recover the amount owed on a promissory note related to the purchase of property. Defendants

moved for relief from judgnient under Civ. R. 60(B) more than 10 years after the judgment entry

was entered against them. The Rowland Court held that the Defendants did indeed seek relief

from judgment within a reasonable time.

With regard to reasonableness test in this case, despite the fact that Appellee began

collection proceedings against the Appellants in July of 2006, Appellee did not produce a

postjudgment accounting until over five years later. Furthermore, when the Appellants moved

for Relief from Judgment upon receipt of such accounting, Appellee still had not produced any

prejudgment accounting. (Defendants' Motion for Relief from Judgrnent with Memorandum in

Support at P. 7, FN 3.) In addition to the foregoing, Appellee did not produce the prejudgment

6

accounting until August 24, 2012, over six years after it began collection proceedings and the

garnishment of the Appellants' wages. (Defendants'Supplemental Memorandum in Support of

Relieffroni Judgment at P. 6.)

However, within two weeks of receipt of the prejudgment accounting, the Appellants

filed their Supplenaental Memorandum in Support of Relief from Judgment. As noted in the

Supplemental Memorandum, it was only after receipt of the prejudgment accounting that the

inequitable nature of the interest rate charged in excess of Ohio statutory law and the collections

based on a Note became fully ascertainable to the Appellants. In light of the fact that Appellee

delayed for six years to provide both a postjudgment and prejudgment accounting, and the fact

the Appellants originally moved for relief from judgment prior to receipt of a full accounting

from Appellee, the Court of Appeals erred in finding that Appeliants' relief was not timely

sought.

Thus, in light of all of the foregoing, it is clear that the Appellants have satisfied all three

elements of the GTEAutomatic test and that the Court of Appeals erred in afrirming the decision

of the Court of Common Pleas.

As noted, Appellee has charged and collected interest at a rate nearly three times that

permitted under Ohio law. Where interest on a promissory note is charged at a rate in excess of

8%, Ohio law demands that it be reduced to the statutory limit of 8%. Hudson & Keyse, LLC v.

YarNevic-Rudolph (Ohio Ct. App., Jef'ferson County 2010), 2010 Ohio 5938 Jj18.

In this case, had the Appellants been charged the maximum statutory rate of 8%, they

would have paid, in fizll satisfaction of the note, a total of $20,502.38 and the note would have

been paid off, in full, in June 2009.

7

The agreements at issue in this matter and in Hudson are strikingly similar. In Hudson

the Court concluded that R.C. 1343.01 applied and instructed the lower court to reduce the

applicable interest rate to 8% pursuant to R.C. 1343.01. Likewise, in the case sub judice, the

Court of Appeals should have held that a maximum interest rate of 8% was applicable with

respect to Appellants and granted the relief requested with respect to the Judgment.

CONCI;USiON

Based on an interest rate and interest compounding in violation of Ohio statutory law,

Appellants have paid more than $40,000 in satisfaction of a $15,000 note, Appellee seeks to

have the Appellants pay nearly $57,000 in satisfaction of the $15,000 note. Civ. R. 60(B)(4) is

designed for matters wllere equity is on the side of justice in preventing a consumer from

predatory lending practices as described herein.

For these reasons, Appellants respectfully request that this Court grant jurisdiction to

consider this matter on the nlerits.

3300 Great. E1rnencan i ower301 East Fourth StreetCincinnati, OH 45202513.651.6800 (phone)513.651.6981 (facsimile)tgabelmanic^com

COUNSEL FOR APPELLANTS, CONNIEAND MARK GABELMAN

CERTIFICATE OF SERVICE

I hereby certify that a copy of the foregoing Memoranduxn In Support of Jurisdiction was

served this 4th day of December, 2013 by regular United States mail delivery upon the following

person:

Audra T. FunkJavitch, Block & Rathbone, LLCAttorney for Plaintiff140 East Town Street, Suite 1250Columbus, OH 43115

(0018165)

COUNSV-L FOR APPELLANTS, CONNIE ANDMARK GABELMAN

CNI,`_.ibrary 0000000.0001543 3176344s!1

9

i

^ILEDIN THE COURT OF APPEALS FOR LICKING COUNTY, OHIO

FIFTH APPELLATE D(STRiCT Z0€3 OCT 2€ P 2' 2 $

Ci.i:. RK oF COURTSOi APPEALS

LICKING COUNTY OHCALVARY SPV 1, LLC ASSIGNEE 0 RY PWAI TF'P SOF BENEFICIAL OHIO, INC.

Plaintiff-Appellee

-vs-

CONNIE M. GABELMAN ANDMARK J. GABELMAN

Defendants-Appellants

JUDGMENT ENTRY

CASE NO. 13-CA-15

For the reasons stated in our accompanying Memorandum-Opinion, the

judgment of the Court of Common Pleas of Licking County, Ohio is affirmed. Costs to

appellants.

c_,eHon. She G. Farmer

Hon.lNitliam B. HoffFW

-Hon. Patricia A. Delaney

U I ^293

FILEDCOURT OF APPEALS

LICKING COUNTY, OH7O ZO 13 Otp. T 21 P 2^ 28FIFTH APPELLATE DISTRICT C„^ ^^ ^n1)QT3

CALVARY SPV (, LLC ASSIGNEEOF BENEFICIAL OHIO, INC..

Plaintiff-Appellee

_vs_

CONNIE M. GABELMAN ANDMARK J. GABELMAN

Defendants-Appellants

CHARACTER OF PROCEEDING:

JUDGMENT:

DATE OF JUDGMENT:

APPEARANCES:

For Plainfiff-Appellee

AUDRA T. FUNK140 East Town StreetSuite 1250Columbus, OH 43215

E;L^.nOF AP^EALS

LICK1t1G COUNTY OHGA R l` 1 Z. ^iALT' R S

JUDGES:Hon.lNilliam B. Hoffman, P.J.Hon. Sheila G. Farmer, J.Hon. Patricia A. Delaney, J.

Case No. 13-CA-15

OPINION

Appeal from the Court of CommonPleas, Case No. 2008CV00397

Affirmed

For Defendants-Appellants

THOMAS L. GABELMAN3300 Great American Tower301 East Fourth StreetCincinnati, OH 45202

u1/V9

Licking County, Case ^v.,. 13-CA-15 ' 2

Farmer, J.

{%1} On March 27, 2006, Beneficial Ohio, Inc., kna Calvary SPV I, LLC,

assignee of Beneficial Ohio, Inc., appellee herein, filed a complaint against appellants,

Mark and Connie Gabelman, for money due and owing on a $15,000.00 loan

agreement. On May 1, 2006, appellee filed a motion for default judgmenL By judgment

entry filed same date, the trial court granted the mofion and entered judgment for

appellee in the amount of $21,294.33 plus interest at the rate of 22.98%. Garnishment

proceedings commenced in July 2006.

{%2} On September 28, 2011, appellants filed a motion for accounting and

termination of garnishment. On October 20, 2011, appellants filed a Civ.R. 80(B)

motion for relief from judgment, claiming the judgment had been satisfied or was no

longer equitable. A hearing was held on December 21, 2012. By judgment entry filed

March 26, 2012, the trial court granted the motion for accounting which was

subsequently filed on August 27, 2012. By judgment entry filed January 22, 2013, the

trial court denied appellants' Civ.R. 60(B) motion.

{13} Appellants filed an appeal and this matter is now before this court for

consideration. Assignment of error is as follows:

{14} "THE TRIAL COURT ERRED IN DENYING THE GABELMANS' MOTION

FOR RELIEF FROM JUDGMENT."

{15) Appellants claim the trial court erred in denying their Civ.R. 60(B) motion

for relief from judgment as it is inequitable to enforce a judgment which wiil allow

07

' Licking County, Case L 13-CA-15 ; 3

appettee to collect more than $57,600.00 on a$15,00g.00 note based upon a 22.98%

interest rate. We disagree.

(^6} A motion for relief from judgment under Civ.R. 60(B) lies in the trial court`s

sound discretion. Griffey v. Rajan, 33 Ohio St.3d 75 (1987). In order to find an abuse

of that discretion, we must determine the trial court`s decision was unreasonable,

arbitrary or unconscionable and not merely an error of law or judgment. Blakemore v.

Blakerrtore, 5 Ohio St.3d 217 (1983). Appellants based their Oiv.R. 66(B) motion on the

fact that the "judgment has been satisfied***or it is 'no longer equitable that the judgment

should have prospective application." Civ.R. 60(B)(4). In GTEAufomefic Etectric Inc. v.

ARC Industries, Inc., 47 Ohio St.2d 146 (.1976), paragraph two of the syllabus, the

Supreme Court of Ohio held the following:

To prevail on a motion brought under Civ.R. 60(B), the movani

must demonstrate that: (1) the party has a meritorious defense or claim to

present if relief is granted; (2) the party is entitled to relief under one of the

grounds stated in Civ.R. 60(B)(1) through (5); and (3) the motion is made

within a reasonable time, and, where the grounds of relief are Civ.R.

60(B)(1), (2) or (3), not more than one year after the judgment, order or

proceeding was entered or taken.

{¶7} In its judgment entry filed January 22, 2013, the trial court found the

following:

2^P

Licking County, CaseL. 13-CA-15 4

Upon hearing arguments from Plaintiffs counsel, the court

determines that the Defendants' Motion for Relief From Judgment is not

well taken. Specifically, Defendants claim they are entitled to relief under

Ohio Civ.R. 60{B}(4) because the Judgment should be deemed "satisfied,

released or discharged" by this Court. Defendants argue that a balance is

not owed on the Judgment and actually claim that they have overpaicf

because they believe the interest rate awarded in connection with the

Judgment was unlawful. However, their argument is faulty because it is

based upon an incorrect characterization of the underlying agreement in

this case and attendant incorrect application of the statute governing the

interest rate awarded. The Court determines that the underlying

agreement in this case was a Revolving Loan Agreement governed by

R.C. §1321.571 which permits an agreed interest rate up to 25% between

the parties. Here, according to the Revolving Loan Agreement the interest

rate agreed to by the parties was 22.98% and that was the interest rate

awarded in connection with the Judgment. For these reasons, the

Defendants' Motion for Relief From Judgment is denied.

{%8} It was appellants' positton that the contract upon which the judgment was

based on was a promissory note; therefore, R.C. 1343.01 controls the interest rate:

The par#ies to a bond, bill, promissory note, or other instrument of

writing for the forbearance or payment of money at any future time, may

211

5

ucking County, Case k_ 13-CA^15

for the payment of interest upon the amount thereof atstipulate therein annua({y, exceptany rate not exceeding eight per oent per annum payable

as authorized in division (B) of this section.

upon which the judgmerit was granted was entitled

{^g} The instrument ^ ed that appellants were recelving a

reernent, and spec ►#icalty identifiedLoan Ag laint filed nllarch 26, 2006.

11 nal Credit Line." See, Exhibit A, attached to the Comp d be required in a

Nowhere^'erso in the agreement is there a specific amount to pay as woui

promissory note under R.C. 1303.03:

Et as provided in divisions (C) and (D) of this section,(A) l"xc p

,t instrumer►t" means an unconditional promise or order to pay a

negot^ableone , with or without interest or other charges described

fixed amount of m '^ requirements:

m' the promise or order, if it meets all of the following st

is a able to bearer or to order at the time it is issued or ^r('f)lt p y

comes into possession of a holder.

2) it is payabie.on demand or at a definite time• the

{ other undertaicing or instruct^on by(3) It does not state any

addition to theperson promising or ordering payment to do any act in

e but the promise c^r order may contain any of thepayment of mon y,

following. collateral^a) An undertalcing or power to give, maintain, or protect

to secure payment;

po

Licking County, Case L. 13-CA-15 6

(b) An authorization or power to the holder to confess judgment or

realize on or dispose of collateral;

(c) A waiver of the benefit of any law intended for the advantage or

protection of an obiigor.

(8) "Instrument" means a negotiable instrument.

(E)(1) ,,Note" means an instrument that is a promise.

{¶10} On May 9, 2006, the trial court granted default judgment to appellee,

ordering the following: "IT IS THEREFORE ORDERED, ADJUDGED AND DECREED

that pursuant to Ohio Civil Rule 55, default judgment is hereby rendered against the

Defendant (s) in the amount of $21,294.33, and interest at the rate of 22.98% per

annum from February 28, 2006 and costs of the within action," Appellants did not seek

relief from judgment until September 28, 2011, some five plus years after judgment. At

all times, the judgment clearly stated the 22.98% interest rate. The docket illustrates

appellants were aware of the default j6dgment and its interest rate as early as July 10,

2006, when they requested and were granted a hearing on garnishment, on October 12,

2006, via a notice of court proceeding to collect debt and order of continuous

disbursement of funds from garnishment, and November 3, 2006, a(etter dated

November 3, 2006 appearing that the garnishment had been granted.

{'^11} Appellants argue they have satisfied the reasonable time requirement

under GTE Automatic because they have just now determined that they have more than

.satisfied the judgment. See, October 20, 2011 Motion for Relief From Judgment, fn. 3.

fli

Licking County, Case 93-CA-95 7

{Y12} We fail to find that appellants can now avai{ themseives of an excuse for

lack of timeiiness, when in fact the record demonstrates an awareness of the judgment

and interest charged some two months after the granting of the default judgment. We

conclude the necessity for finality of judgments and the awareness by appellants of the

interest rate within one year of the judgment mandate that the motion for relief from

judgment be denied as untimely.

{ll 3} The sole assignment of error is denied.

{%14,} The judgment of the Court of Common Pleas of Licking County, Ohio is

hereby affirmed.

By Farmer, J.

Hoffman, P.J. and

Delaney, J. concur.

^r'(r,^i ^8 rl f + P

Hon. Sheitl G. Farmer

Hon. William B. Hoffma

. . . ^^ ^

Hon. Patricia A. Delaney

SGF/sg 926

282

IN TI-IE SUI'REIi'IE COURT OF OHIO

CALVARY SPV I, LLC ASSIGNEE OF . Appeal No. 13-1913BENEFICIAL OHIO, LNC.,

Appellee,

V,

On Appeal from the Licking CountyCourt of Appeals, Fifth AppellateDistrict

CONNIE M. GABELMAN, et al.,

Appellant.

Court of Appeals Case No. 13CA0015

AFFIDAVIT IN SUPPORT OF MOTION TO STRIYJ'. AND REPLACE PLEADING OFAPPELLANTS

CONNIE M. GABELMAN AND MARK J. GABELMAN

Thomas L. Gabelman (0018165) (COUNSEL OF RECORD)3300 Great American Tower301 East Fourth StreetCincinnati, OH 45202513.651.6800 (phone)513.651.6981 (facsimile)tgabelman. fbtlaw.com

COL'NSEL FOR APPELLANTS, CONNIE AND MARK GABELMAN

James Oh, Esq.Javitch, Block & Rathbone LLC1100 Superior Avz, 19th FloorCleveland, Ohio 44114tel. (216) 685-3023fax (216) 525-4929joh@jbandr.com

COUNSEL FOR APPELLEE CALVARY SPV I, LLCASSIGNEE OF BENEFICIAL OHIO, I^TC,

4

Efl

STATE OF OHIO }) ss:

COUNTY OF HAIv1ILTON }

Thomas L. Gabelman, being duly sworn, deposes and says:

1. I am over 18 years of age and I make this affidavit from my personal knowledge.

2. I am counsel to the Appellants Connie M, and Mark J. Gabelman.

3. On December 4, 2013 I signed for filing and service upon Appellee Appellants'

Notice of Appeal, Memoranduzn in Support of Jurisdiction and service letter to

the Clerk of the Supreme Court.

4. On December 20, 2013, at 12:19 p.m., Appellee's counsel advised me by

electronic mail of the omission o f pages 1 and 2 from the Memorandum in

Support of Jurisdiction of Appellants Connie M. Gabelman and Mark J.

Gabelman that was served upon Counsel.

5. Upon confirmation of the omission, at 12:52 p.m. I immediately transmitted a

complete copy of the Memorandum in Support via electronic mail to Appellee`s

Counsel.

6. Prior to December 20, 2013, I had no knowledge of the 2 missing pages from

Appellants' Memorandum in Support.

7. This was a clerical error wh.ich omitted a portion of the Statement of the Case and

Facts, as noted in the Table of Contents. The Statement of the Case and Facts are

not a disputed matter in this proceeding.

5

FURTHER AFFIANT SAYETH NA^T

omas L. Gabelman

Sworn and subscribed in my presence on this 20th day of December, 2013.

;--^'^^..^^^^:-^^^-=

Notary Public, State of Ohio

My commission expires ilfCI1,1f 4^^,^p►a^"s^,,,:.a ^1 !I/^j ^r

CINLibrary0000000.0007524 3187823v1Melissa A. ^ahtl

iVotary PubfiC, State ®f nhio

MyCOrrrMISsloa EOes NovemSar t, 20f4®E <?^,'V

6

CERTIFICATE OF SERVICE

I hereby certify that a copy of the foregoing Affidavit in Support of :Ylotion to Strike and

Replace Pleading was served this 20th day of December, 2013 by regular United States maildelivery upon the following person:

James Oh, Esq.Javitch, Block & Rathbone LLC1100 Superior Ave, 19th FloorCleveland, Ohio 44114tel. (216) 685-3023fax (216) 525-4929iohQjbandr.com

L. Gabelman (0018165)

COUN SEL FOR APPELLANTS, CONNIE ANDNIARK GABELMAN

cIIvz'rbrary oao000o,0001524 3187823v1

7