Stewart P. Blanchard borrowed $ 50,000 from Progressive Bank & Trust Company (Progressive) to purchase a home. As part of the transaction, Blanchard signed a note secured by a mortgage. The note provided for a 10 percent annual interest rate. Under the terms of the note, payment was “due on demand, if no demand is made, then $ 600 monthly” beginning at a specified date. Blanchard testified that he believed Progressive could demand immediate payment only if he failed to make the monthly installments. After one year, Blanchard received notice that the rate of interest on the note would rise to 11 percent. Despite the notice, Blanchard continued to make $ 600 monthly payments. One year later, Progressive notified Blanchard that the interest rate on the loan would be increased to 12.75 percent. Progressive requested that Blanchard sign a form consenting to the interest rate adjustment. When Blanchard refused to sign the form, Progressive demanded immediate payment of the note balance. Progressive sued Blanchard to enforce the terms of the note. Is the note a demand instrument? Did either party act unethically in this case? Blanchard v. Progressive Bank & Trust Company, 413 So. 2d 589, 1982 La. App. Lexis 7213 (Court of Appeal of Louisiana)
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