Alien, Inc. v. Futterman

• Decision Date: 14 September 1995
• Docket Number: No. 94CA1026,94CA1026
• Parties: ALIEN, INC. and Alistair Company, Ltd., Plaintiffs-Appellees, v. Lewis FUTTERMAN and Alma Equities Corporation, Defendants-Appellants. . IV
• Court: Colorado Court of Appeals

Page 1063

924 P.2d 1063

ALIEN, INC. and Alistair Company, Ltd., Plaintiffs-Appellees, v. Lewis FUTTERMAN and Alma Equities Corporation, Defendants-Appellants.

No. 94CA1026.

Colorado Court of Appeals Div. IV.

Sept. 14, 1995.

As Modified on Denial of Rehearing

Nov. 16, 1995.

Dunn, Abplanalp & Christensen, P.C., John W. Dunn, Vail, Fairfield and Woods, P.C., John M. Tanner, Denver, for plaintiffs-appellees.

Rubner & Kutner, P.C., Joan B. Burleson, Wendy S. Wagner, Denver, for defendants-appellants.

Opinion by Judge DAVIDSON.

Defendants, Lewis Futterman and Alma Equities Corporation (Alma), appeal from the summary judgment entered in favor of plaintiffs, Alien, Inc., and Alistair Company, Ltd. We affirm in part, reverse in part, and remand.

The following facts are not disputed. Futterman is the president and sole stockholder of Alma. In May 1989, Alma purchased a hotel and restaurant in Vail, Colorado (the property) from Alien for $3,900,000. Alien received a $600,000 down payment and provided a purchase money loan to Alma for the remaining $3,300,000, secured by a deed of trust on the property. Alien later assigned the note and deed of trust to Alistair. Alma renovated and developed the property into a hotel and restaurant operating under the name "L'Ostello."

In the spring of 1991, Alma defaulted on its loan. To avoid a bankruptcy filing by Alma, the parties negotiated an agreement allowing a "friendly foreclosure." In return, Alien agreed to lease the property to and allow continued operation of the hotel and restaurant by Bienvenue!, Inc. (Bienvenue), a new corporation formed by Futterman. Alien also agreed to give Bienvenue an option to purchase the property, to allow encumbrance of the property to secure financing for additional renovation, and to execute a back-up lease for the restaurant only, in the event the lease for the property were terminated.

Pursuant to this agreement, plaintiffs foreclosed on the deed of trust in May 1991, and the lease and option to purchase were executed between the parties. Futterman personally guaranteed the obligations under the lease. Although the parties were unable to agree on certain aspects of the back-up restaurant lease, they executed a letter of intent "to work together in resolving any remaining issues in order to execute [such a lease]."

Alistair subsequently provided the loan to Bienvenue for renovation of the property, and Bienvenue accordingly executed a promissory note with Futterman as unconditional guarantor. When Bienvenue was unable to make rent payments in November and December 1991, plaintiffs commenced an unlawful detainer action against Bienvenue and Futterman. Prior to any hearing in the action, Bienvenue filed for bankruptcy.

Plaintiffs obtained relief from the automatic stay in bankruptcy proceedings, and an expedited hearing on possession was held in the trial court. Bienvenue filed an answer at that hearing asserting, as pertinent here, affirmative defenses of fraud and equitable mortgage and counterclaims for breach of contract and fraudulent inducement to contract. Futterman, individually, neither answered nor appeared at the hearing.

At the conclusion of that hearing, the trial court awarded possession of the property to plaintiffs.

Futterman and Alma then initiated an action in federal district court against plaintiffs, alleging breach of contract, fraudulent inducement of contract, promissory estoppel, and conversion of personal property, and requesting declaratory judgments that an equitable mortgage existed and that Futterman was released from the guarantees. Futterman and Alma further requested an injunction against plaintiffs' use of the trade name "L'Ostello."

Futterman and Alma also recorded a notice of lis pendens on the property, giving notice of their federal court claims.

Plaintiffs then filed an amended and supplemental complaint in the state court action and against Futterman as guarantor of the lease and the note. Plaintiffs also requested a declaratory judgment that Futterman and Alma had no rights in the property. In their joint answer, Futterman and Alma asserted, as pertinent here, only a defense of unjust enrichment.

Plaintiffs then moved for partial summary judgment against Futterman as guarantor and for a declaratory judgment that neither Futterman nor Alma had any interest in the property. Shortly thereafter, Futterman and Alma, without leave of court, filed as counterclaims the same claims for relief asserted in the federal court action. Plaintiffs immediately moved to strike the counterclaims.

Futterman and Alma then responded to plaintiffs' motion for partial summary judgment, alleging fraudulent inducement of contract, unjust enrichment, and equitable mortgage. In their reply, plaintiffs requested release of the notice of lis pendens.

The trial court struck Futterman's and Alma's counterclaims and granted plaintiffs' motion for partial summary judgment, finding that neither Futterman nor Alma had a claim to the property. The court later amended its order and released the lis pendens.

Bienvenue's pending counterclaims against plaintiffs previously had been assigned to Futterman by Bienvenue's bankruptcy trustee. Bienvenue's counterclaims were then tried to a jury and Bienvenue was awarded damages on its claims of fraudulent inducement and promissory estoppel.

Futterman and Alma now appeal from various orders and from the summary judgment entered against them.

Preliminarily, we note that, throughout the litigation and on appeal, all parties have submitted inconsistent and contradictory pleadings and briefs, each asserting at different times either that Bienvenue and Alma are alter-egos of Futterman or that they are separate and distinct entities. However, no factual finding was made by the trial court that Alma and Bienvenue were mere alter-egos of Futterman; thus, we shall consider them as separate entities for purposes of this appeal.

Similarly, there are also inconsistent assertions, and no findings by the trial court, as to which entities are bound by the various agreements at issue here. Nevertheless, because the parties appear to be in agreement in their briefs on appeal that Bienvenue executed the lease, the option to purchase, the letter of intent and the note, and that Futterman guaranteed the lease and the note, we accept these as undisputed facts.

I.

On appeal, Futterman asserts three interrelated issues concerning: unjust enrichment in his capacity as guarantor of Bienvenue's obligations; his liability as guarantor in light of the alleged fraud perpetrated on the obligor, Bienvenue; and his defense that he was fraudulently induced to enter into his guaranties of the lease and note. Although arguments pertaining to these issues are intermingled in the briefs, we conclude that each must be separately addressed because a guaranty is a separate and distinct contract from the underlying obligation being guaranteed. See Burkhardt v. Bank of America, 127 Colo. 251, 256 P.2d 234 (1953).

Hence, although a guarantor is entitled to assert personal defenses to the separate guaranty contract, he or she is not always entitled to rely on a principal's defenses or counterclaims to the underlying obligation. "While the extent of a guarantor's liability certainly does not exceed the maker's underlying obligation, the actual liability of the guarantor may exist even when the maker ... is not liable on the note." United States v. Little Joe Trawlers, Inc., 776 F.2d 1249, 1252 (5th Cir.1985).

Accordingly, we consider each argument in turn. We agree with Futterman that summary judgment was improperly granted on his claim that he was fraudulently induced into signing the guaranties. We do not agree, however, that summary judgment on his defenses of unjust enrichment and fraudulent inducement of the obligor was improper.

A.

Based on his claim that genuine issues of material fact exist as to whether he was fraudulently induced to enter into his contracts of guaranty, Futterman contends that the trial court erred in entering summary judgment against him as guarantor of the lease and the note. We agree.

Summary judgment is proper only if there is a clear showing that there is no genuine issue as to any material fact, and the burden so to demonstrate is upon the movant. Persichini v. Brad Ragan, Inc., 735 P.2d 168 (Colo.1987). All doubts are resolved against the movant. Moffat County State Bank v. Told, 800 P.2d 1320 (Colo.1990).

Here, the record indicates that genuine issues of material fact exist as to whether plaintiffs' promise to negotiate a restaurant lease--which promise Futterman alleges induced him to sign the guaranties--was made without a present intention to fulfill that promise. See Kinsey v. Preeson, 746 P.2d 542 (Colo.1987).

Nevertheless, plaintiffs argue that, because Futterman did not plead the affirmative defense of fraud in his answer to their amended complaint, and because Futterman's counterclaim of fraudulent inducement was stricken as untimely by the trial court, the defense of fraudulent inducement was not properly raised and the court therefore did not err in granting the summary judgment. We do not agree.

Fraud is an affirmative defense which must be pled with particularity. C.R.C.P. 8(c) & 9(b). A party waives all affirmative defenses and objections not presented in the answer, Duke v. Pickett, 168 Colo. 215, 451 P.2d 288 (1969), but an improper assertion of an affirmative defense must be objected to or such defect is waived. Cox v. Pearl Investment Co., 168 Colo. 67, 450 P.2d 60 (1969).

In his response to plaintiffs' motion for partial summary judgment, Futterman claimed for the first time that he was defrauded into signing the guaranties. Although we agree with plaintiffs that this defense is more properly asserted in an answer, nevertheless, it was stated with sufficient particularity and supported by affidavit such that it should have been treated as being...