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Click here for the full text of this decision FACTS:In 1995, upon an oral agreement, GeoSurveys secured a $910,000 loan with State National Bank to build a gas pipeline for the city of Brady. Geo then signed a five-year note that required Geo to make monthly payments of more than $19,000. In March 1999, Geo asked the bank to reduce its monthly payments. Geo eventually signed a one-year note with monthly payments cut to just over $9,600. The balance due at the time was nearly $537,000. One of Geo’s representative;s, Tony Preslar, thought the note would be for six years and was surprised at the thought that the note included a balloon payment at the end of the year term. He says the bank chairman, Ray Howe, assured him that the note would be renewed at the end of the year, but Howe said he never made such a guarantee. Preslar met with Howe and another bank representative, Jim Richmond, in February 2000 to discuss the renewal of the March 1999 note. Preslar thought the note was being renewed for another year, but at a higher interest rate, but Richmond said he did not see things that way. When Preslar received a notice saying the entire balance was due by March 30, he said the bank told him to tear it up. Then the bank told him he had 90 days to pay the note off. Meanwhile Richmond said that Geo’s risk rating had been downgraded to “doubtful.” Preslar began talking to National Bank of Baird about moving the loan to that bank. They then talked about getting a loan through the Small Business Administration. To get an SBA loan, Geo had to be current on its loan at State National. State National eventually renewed the note, increasing the payments to $9,700, three more times. Geo was approved for an SBA loan on Sept. 28, 2000. Geo, Preslar and another Geo officer filed suit against State National on March 30, 2001, alleging fraud, negligent misrepresentation and slander. Upon State National’s May 31 motion, the trial court compelled arbitration. The arbitrator found that the bank breached its agreement to renew and extend the balance of the loan, but the arbitrator also found that the costs Geo incurred in moving its loan to Bank of Baird were not the direct or proximate result of that breach. The arbitrator consequently ordered a take-nothing judgment for the plaintiffs. The trial court adopted the arbitrator’s findings. On appeal, Geo challenges the trial court’s order to compel arbitration and its adoption of the arbitrator’s findings. HOLDING:Affirmed. Geo complains of the bank’s extensive involvement in discovery after it filed its motion to compel. Geo incurred $9,700 in legal expenses responding to the discovery requests sent by the bank. The court, however, finds this activity to fall below what other courts have found to constitute a waiver of the right to arbitrate. Even though this case does not involve an issue of interstate commerce, the court finds the application of the Federal Arbitration Act to be proper, as the agreement in this case designates the FAA as the applicable law, and courts typically honor the statute of the parties’ choice. The court disagrees that the bank secured the agreement to arbitrate through duress because it had to sign the renewals in 2000 in order to secure the SBA loan. The court finds that no evidence of duress was shown because the bank did not threaten to do something it had no right to do. As for the trial court’s adoption of the arbitrator’s findings, the court finds the findings are supported by the evidence. Finally, Geo challenges the arbitrator’s failure to find that the bank committed fraud. The damages Geo claimed were related to moving the loan to the Bank of Baird and that the damages were not the result of the bank’s breach of the oral contract. The court finds the evidence supports this conclusion. OPINION:Arnot, C.J.; Arnot, C.J., Wright and McCall, JJ.

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