Community Nat. Bank v. Loumos
| Decision Date | 19 January 1978 |
| Citation | 6 Mass.App.Ct. 830,372 N.E.2d 265 |
| Parties | COMMUNITY NATIONAL BANK v. Lycurgus A. LOUMOS, William E. Halliday, Jr., Plaintiff in Cross-Claim. Appeals Court of Massachusetts, Middlesex |
| Court | Appeals Court of Massachusetts |
David L. Taylor, Boston (A. Leavitt Taylor, Boston, with him), for Lycurgus A. Loumos.
Marc Redlich, Boston, for Community National Bank and Leslie B. Shea, Newton, William E. Halliday, Jr., West Newton, joined in a brief.
Before GRANT, ARMSTRONG and BROWN, JJ.
RESCRIPT.
1. The ruling of the judge that the guaranty executed by Loumos, Halliday and the Feinsteins was both absolute and continuing was not, as asserted by Loumos, a contradiction in terms. To the extent that Allen v. Pike, 3 Cush. 238 (1849), supports such an assertion, that case must be regarded as having been impliedly overruled by subsequent decisions which recognize that a guaranty can be both absolute and continuing. See Standard Plumbing Supply Co. v. LaConte, 277 Mass. 497, 499-501, 178 N.E. 611 (1931); Mayo v. Bloomberg, 290 Mass. 168, 169-171, 195 N.E. 99 (1935); Provident Co-op. Bank v. James Talcott, Inc., 358 Mass. 180, 191-193, 260 N.E.2d 903 (1970). The judge ruled correctly that the guaranty at issue was of that type as a matter of law. Doral Country Club Inc. v. O'Connor, 355 Mass. 27, 31, 242 N.E.2d 425 (1968). The guaranty at issue in Dunkirk Trust Co. v. Schmitt, 316 F.2d 537 (2d Cir. 1963), relied upon by Loumos, bears little or no resemblance to the one before us here. 2. Assuming that the third paragraph of the guaranty did not as a matter of law constitute an express waiver of notice by the bank to Loumos of the loans made after the one of September, 1972 (compare Ladd & Bush v. Hayes, 105 F.2d 292 (9th Cir. 1939); but see Manufacturers' Fin. Co. v. Rockwell, 278 Mass. 502, 505-506, 180 N.E. 224 (1932), and Provident Co-op. Bank v. James Talcott, Inc.,358 Mass. at 192 & n. 6, 260 N.E.2d 903), no such notice was required because the guaranty was absolute and was made under seal and upon a recital of binding consideration. Mayo v. Bloomberg, 290 Mass. at 170-171, 195 N.E. 99. Century Indem. Co. v. Bloom, 329 Mass. 508, 513, 109 N.E.2d 166 (1952). See Merrimack Valley Natl. Bank v. Baird, --- Mass. ---, --- - --- a, 363 N.E.2d 688 (1977). Contrast Black, Starr & Frost v. Grabow, 216 Mass. 516, 518, 104 N.E. 346 (1914). In any event, knowledge of those loans was at all times available to Loumos as a director of the debtor corporation and was therefore imputable to him. Juergens v. Venture Capital Corp., 1 Mass.App. 274, 278-279, 295 N.E.2d 398 (1973). 3. We are not persuaded by any of the further reasons advanced by Loumos for the proposition that he was discharged of his obligation as guarantor of the loan of March, 1974. While a guaranty of unspecified duration will ordinarily cease to be operative after the expiration of "a reasonable time" (Zeo v. Loomis, 246 Mass. 366, 368, 141 N.E. 115 (1923)), that rule has no application where, as here, the guaranty provides that it shall continue in effect until receipt by the creditor of the guarantor's written notice of revocation. Manufacturers' Fin. Co. v. Rockwell, 278 Mass. at 504, 180 N.E. 224. Compare Merchants Natl. Bank v. Stone, 296 Mass. 243, 252, 5 N.E.2d 430 (1936); Provident Co-op. Bank v. James Talcott, Inc., 358 Mass. at 192 & n. 6, 260 N.E.2d 903; Merrimack Valley Natl. Bank v. Baird, --- Mass. at --- - --- b, 363 N.E.2d 688. The contention that the judge failed adequately to instruct the jury that Loumos' obligation as to the 1974 loan was discharged if the bank made the loan in bad faith is not properly before us. Neither the abstractly worded request for an instruction that the bank "must have used good faith in dealing with the debtor and the guarantors" nor counsel's blanket objection to the alleged omission from the charge of all but one of Loumos' thirteen requested instructions sufficiently directed the judge's attention to the 1974 transaction (as distinguished from the many previous ones), to the circumstances of that transaction giving rise to a question of good faith, or to the portion of the charge thought to be deficient. See Mass.R.Civ.P. 51(b), 365 Mass. 816 (1974); Narkin v. Springfield, --- Mass.App. ---, --- - --- c, 364 N.E.2d 1074 (1977). The judge's finding that Loumos' denial of the genuineness of his signature in his affidavit in opposition to the bank's motion for summary judgment had been made in bad faith and solely for the purpose of delay was amply supported by the evidence and justified the order entered pursuant to Mass.R.Civ.P. 56(g), 365 Mass. 825 (1974). The argument that no such delay was actually caused by the false affidavit misses the point, as nothing in Rule 56(g) makes its invocation contingent upon the...
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