Pankau v. First State Bank of Harvard (In Re Pankau)

MEMORANDUM AND ORDER

ROBERT E. GINSBERG, Bankruptcy Judge.

The First State Bank of Harvard (“Bank”) made a commercial, non-consumer loan in the amount of $37,000 to the debtor on September 14, 1974. At that time the debtor signed a promissory note containing a confession of judgment clause. The confession of judgment clause provided that upon default the Bank without notice to the debtor could appoint an attorney to appear in court on the debtor’s behalf and confess judgment for the principal and interest due on the note plus costs and attorney’s fees. After the debtor did default on the note,…