LEISA R. BOLEY-HELLWARTH


Legal Lingo


I knew something was wrong when


Luke, my 119-pound Dobie-cross, woke me seven times one night because he had to go outside. His excessive bathroom trips made sense because he had recently started drinking a huge amount of water. And he just didn’t look like my normal healthy, energetic, demanding canine. Luke looked depressed and unhealthy. So, like any neurotic pet owner, I


googled Luke’s symptoms and started worrying that he had Cushing’s Disease (hyperadrenocorticism). As soon as I could, I took him to our vet- erinarian. After several tests, Luke was given a preliminary diagnosis of Addison’s Disease (hypoadrenocorti- cism or adrenal insufficiency), the exact opposite condition of what I feared. His treatment involves determining the minimal amount of prednisone to nor- malize him. Luckily, it appears that Luke will


require only a small amount of steroid, on a weekly basis. This is good news because the problem with prednisone is that the side effects are challenging and very simi- lar to his original symptoms. He still needs to go outside frequently and will drink as much water as permitted. Luke is improving, though, and requir-


ing only a minimal amount of prednisone on a weekly basis. And the side effects are almost gone, so Luke is back. I’ve often thought that if Cesar


Millan (the Dog Whisperer) were to meet Luke, he would probably advise that Luke needs boundaries. That’s pretty much what the Ohio


Supreme Court decided in 2009 when it dealt with the issue of compounding interest on a default on a written instrument that didn’t authorize it. It all began in 1995, in Geauga County, when the Medancics purchased real estate from the Mayers. The Medancics executed three promissory notes in favor of the Mayers. The promissory notes stipulated per annum interest rates of 13%, 12% and 10%. None of the documents made any mention of post- judgment interest. In 1998, the Mayers filed three fore-


closure complaints alleging that the Medancics had failed to pay both the principal and interest due on the notes. The Mayers won their case after a bench trial (no jury). The trial court held the Mayers were entitled to judg- ment of foreclosure and payment of the principal of the notes and interest at the rates specified therein. The Medancics filed a motion to


declare the rate of postjudgment inter- est owed on the notes to be the statuto- ry rate set forth in R.C. 1343.03. In reply, the Mayers argued that they were entitled to postjudgment interest at the rates set forth in the notes and that the interest should be compound- ed annually until the debt is paid. The


Ohio’s Country Journal • ocj.com • Mid-April 2012 29


trial court ruled that the Mayers were entitled to postjudgment interest at the rates set forth in the notes and rejected the claim for compound interest. The Mayers took their argument for compound interest to the Eleventh


District Court of Appeals who agreed and ordered compound interest at the rates specified in the notes. In 2009, the Ohio Supreme Court decided to tackle the issue of compound interest because there was a conflict between the Eleventh


District that agreed with compound interest and the Tenth District that reject- ed it. The specific question before the Ohio Supreme Court was, “When a writ- ten instrument sets forth a specific rate of interest to be paid, and there is a default in the payment of that interest, is the creditor entitled to compound interest, even absent a statute or provision there- for in the written instrument?” Twelve pages later, the answer was as follows: “Because there is neither a


statutory provision providing for com- pound interest nor an express agree- ment between the parties, Mayers are entitled to simple, not compound, interest. However, the interest that accrues is calculated on the entire amount due at the time of the default, including both the principal and inter- est due and payable at that time. Sounds like a reasonable outcome to


me. What doesn’t make sense (or cents) is litigation that lasts 14 years.


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