Bennett v. Union Nat. Bank & Trust Co.

• Citation: 169 Ga.App. 904,315 S.E.2d 431
• Decision Date: 06 January 1984
• Docket Number: No. 67276,67276
• Court: Georgia Court of Appeals
• Parties: , 39 UCC Rep.Serv. 1144 BENNETT et al. v. UNION NATIONAL BANK & TRUST COMPANY.

Page 431

315 S.E.2d 431

169 Ga.App. 904, 39 UCC Rep.Serv. 1144

BENNETT et al. v. UNION NATIONAL BANK & TRUST COMPANY.

No. 67276.

Court of Appeals of Georgia.

Jan. 6, 1984.

Rehearing Denied Feb. 22, 1984.

A.J. Block, Jr., Paul R. Jordan, Atlanta, for appellants.

Russell S. Thomas, Atlanta, for appellee.

QUILLIAN, Presiding Judge.

The plaintiff brought suit to recover under the terms of a written agreement to guarantee payment executed by the two defendants. After discovery, the trial judge granted the plaintiff's motion for summary judgment and entered judgment against the defendants. They appeal. Held:

The instant agreement provided: "For value received, the sufficiency of which is hereby acknowledged, and in consideration of any loan or other financial accommodation heretofore or hereafter at any time made or granted to William Paul Bennet, Jr. individually and d/b/a Field and Stream (hereinafter called the 'Debtor') by Union National Bank and Trust Co. (hereinafter, together with its successors and assigns, called the 'Bank'), the undersigned hereby unconditionally guarantee(s) the full and prompt payment when due, whether by declaration or otherwise, and at all times hereafter, of all obligations of the Debtor to the Bank, however and whenever incurred or evidenced ..." It further provided: "This guaranty shall be continuing, absolute and unconditional and shall remain in full force and effect as to the undersigned, subject to discontinuance of this guaranty as to any of the undersigned (including, without limitation, any undersigned who shall become deceased, incompetent or dissolved) only as follows: Any of the undersigned, and any person duly authorized and acting on behalf of any of the undersigned, may give written notice to the Bank of discontinuance of this guaranty as to the undersigned by whom or on whose behalf such notice is given, but no such notice shall be effective in any respect until it is actually received by the Bank ..."

1. The two defendants signed the agreement guaranteeing payment up to $21,000 for any loans issued to their son designated therein as "Debtor." They contend the initial loan was paid off and that it was their understanding that such payment ended their entire obligation owed under the agreement. The agreement clearly does not so provide and their attempt to vary by parol evidence the terms of an unambiguous written contract must fail. Walter E. Heller & Co. v. Aetna Business Credit, 151 Ga.App. 898, 903(7), 262 S.E.2d 151.

2. After other money was loaned to the "Debtor" the defendants argue that the plaintiff sought to obtain their agreement to guarantee the entire loan in the amount of $40,000 which they refused to do. They argue this shows they notified the plaintiff to discontinue the guaranty agreement. However, the applicable provision clearly requires written notice to the plaintiff bank and actual receipt of such notice. There is no proof that this occurred.

3. The defendants contend that since the guaranty agreement refers to the law of Michigan the plaintiff had the burden of establishing the law of Michigan in order to recover. Under White Farm Equipment Co. v. Jarrell etc. Equipment Co., 139 Ga.App. 632(2), 229 S.E.2d 113 and Colodny v. Krause, 141 Ga.App. 134, 138(5), 232 S.E.2d 597 the law of Michigan will be taken as not contrary to the law of Georgia--especially since both states have adopted the Uniform Commercial Code.

Judgment affirmed.

SOGNIER and POPE, JJ., concur.

ON MOTION FOR REHEARING

Defendant/movant contends that under Barbree v. Allis-Chalmers Corp., 250 Ga. 409, 297 S.E.2d 465 a surety or guarantor must be given notice of disposition of collateral under OCGA § 11-9-105(1)(d) (Code Ann. § 109A-9-105) and that plaintiffs were required to show the sale of collateral was commercially reasonable under First Nat. Bank v. Rivercliff Hardware, 161 Ga.App. 259, 287 S.E.2d 701. It is argued that a failure to accomplish this is a bar to plaintiffs' recovery.

First, as to notice this court has held that: "In a suit by a creditor against the surety or guarantor of a principal debtor, proper proof of the rendition of a judgment in favor of the creditor against the debtor is not conclusive against the surety or guarantor, but it does establish prima...