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Banking
Loan Agreement
Breach of Contract

Laurel Canyon-Chelsea LLC, a Delaware limited liability company, Theodore Stein Jr., an individual v. Cathay Bank, a California corporation

Published: Jul. 14, 2012 | Result Date: May 24, 2012 | Filing Date: Jan. 1, 1900 |

Case number: 72104Y0018311JMLE Arbitration –  $1,508,910

Court

American Arbitration Association


Attorneys

Claimant

Patricia L. Glaser
(Glaser Weil Fink Howard Avchen & Shapiro LLP )

Paul B. Salvaty


Respondent

Louis R. Miller III
(Miller Barondess LLP)

Steven Neal Bloom

Daniel B. Miller
(Wilshire Law Firm PLC)

Elina Kreditor


Facts

Respondent Cathay Bank provided a loan to petitioner Theodore Stein, extending the payment of the loan 12 times over a four-year period, but Stein nevertheless defaulted. Claimants brought an action, asserting claims for breach of a written contract, breach of an oral contract, fraudulent inducement, and breach of the covenant of good faith and fair dealing. Cathay Bank brought a counterclaim when Stein failed to make a payment on the loan and filed two motions for summary judgment as to Claimants' claims and Respondent's counterclaim.

Result

Respondent's motions were granted because Cathay Bank acted reasonably when it gave multiple extensions, and because evidence of Stein's oral contract was barred by the parol evidence rule and the statute of frauds. Stein's fraud claim was also barred because Stein, an experienced attorney, real estate developer, and real estate broker could not show justifiable reliance as a matter of law. Respondent was awarded a total of $1,508,908, including $703,664 in attorney's fees and costs.

Other Information

ARBITRATORS: Robert W. Brown, Lawrence G. Gotlieb, Edward J. Costello Jr.


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