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06/07/94 WILLIAM J. LARNED v. FIRST CHICAGO

June 7, 1994

WILLIAM J. LARNED, PLAINTIFF-APPELLANT,
v.
FIRST CHICAGO CORPORATION AND FCC NATIONAL BANK, DEFENDANTS-APPELLEES.



Appeal from the Circuit Court of Cook County. Honorable Mary Jane Theis, Judge Presiding.

Released for Publication August 2, 1994.

Hartman, DiVITO, McCORMICK

The opinion of the court was delivered by: Hartman

JUSTICE HARTMAN delivered the opinion of the court:

Plaintiff, William J. Larned, appeals from an involuntary dismissal of his class action lawsuit against defendants, First Chicago Corporation (First Chicago) and its wholly owned subsidiary FCC National Bank (First Card) (collectively defendants), filed on behalf of all holders of credit cards issued by defendants, including the "First Card United Mileage Plus Visa" credit card (Visa card), whose payments were due on a Sunday or holiday but were received the following business day and incurred a finance charge. The issues presented by the parties to this appeal are whether (1) the National Bank Act (12 U.S.C. § 21 et seq. (1988)) preempts the Illinois Bank Holiday Act (Holiday Act) (205 ILCS 630/17 (West 1992)); (2) the Visa card agreement's choice of law provision is enforceable; and (3) the Visa card agreement is an adhesion contract.

On October 24, 1990, Larned received a bill from First Card for charges incurred using his Visa card. The statement required that he deliver payment to First Card on or before Sunday, November 18, 1990, in order to avoid a finance charge. On November 15, 1990, Larned mailed a check to First Card in full payment of his credit card balance, but the check was not received until Monday, November 19, one day after the bill's due date. First Card assessed Larned $57.95 as a finance charge due to the late payment.

On June 18, 1992, Larned filed a class action complaint against defendants on behalf of all holders of credit cards "whose payments were due on a Sunday or a holiday and whose payments were received on the first business day following such Sunday or holiday and were subsequently charged a finance charge by the defendants." Larned claimed that the Holiday Act operated to make his payment timelybecause the statute provides that where an indebtedness falls due on a Sunday, the debtor has until the following Monday to pay his debt without incurring finance charges.

Defendants filed a motion to dismiss claiming that the National Bank Act preempted the Holiday Act and that First Card, as a national bank, could not be prohibited from collecting payments on Sunday. Defendants also claimed that the Visa card agreement contained a Delaware choice of law provision and that Delaware law does not have a comparable Holiday Act. As their final argument, defendants asserted that the credit card agreement expressly excluded the effect of the Holiday Act.

On March 23, 1993, the circuit court granted defendants' motion to dismiss finding that the National Bank Act preempted the Holiday Act, Delaware law governed the contract, and the Visa card agreement excludes the effect of the Holiday Act. The court also ruled that the credit card agreement was not an adhesion contract.

On April 22, 1993, Larned filed a motion to reconsider and for leave to file an amended complaint. On July 27, 1993, the circuit court denied these motions and Larned timely filed this appeal.

Section 9 of the credit card agreement is dispositive of this appeal. The operative language of section 9 provides:

"If your Payment Due Date falls on a Saturday, Sunday or holiday, the Payment Due Date will not be extended and failure to get the payment to us as specified on your billing statement on or before that date will result in Finance Charge."

Defendants argue that the Visa card agreement, by requiring payments to be made in accordance with its terms, excluded the effect of the Holiday Act. We agree.

Illinois authorities recognize that, in the absence of contract language to the contrary, laws and statutes in existence at the time a contract is executed are considered part of the contract. ( Hindu Incense Mfg. Co. v. MacKenzie (1949), 403 Ill. 390, 392, 86 N.E.2d 214; Illinois Bankers' Life Ass'n. v. Collins (1930), 341 Ill. 548, 553, 173 N.E. 465; S & D Service, Inc. v. 915-925 W. Schubert Condominium Ass'n. (1985), 132 Ill. App. 3d 1019, 1023, 478 N.E.2d 478, 88 Ill. Dec. 163; Needy v. Sparks (1979), 74 Ill. App. 3d 914, 918-19, 393 ...


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