International Harvester Credit Corp. v. Bowman
| Decision Date | 19 June 1984 |
| Docket Number | No. 8326SC856,8326SC856 |
| Citation | 69 N.C.App. 217,316 S.E.2d 619 |
| Court | North Carolina Court of Appeals |
| Parties | INTERNATIONAL HARVESTER CREDIT CORPORATION v. Harold Roscoe BOWMAN and Barbara J. Bowman. |
C. Eugene McCartha, Charlotte, for plaintiff, appellee.
White & Crumpler by David R. Crawford, Winston-Salem, for defendants, appellants.
We note at the outset that defendants' appeal is from an order "which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties" and is thus premature. N.C.Gen.Stat. Sec. 1A-1, Rule 54(b), North Carolina Rules of Civil Procedure. Nevertheless, we choose to exercise our discretion to pass on the merits of defendants' appeal.
The thrust of defendants' argument on appeal is that summary judgment was inappropriate because of the existence of "multiple genuine issues of material fact" raised by the pleadings and supporting documents considered by the trial judge. We will examine each of these alleged "genuine issues" in turn.
Defendants first contend that a genuine issue exists as to whether their execution of the guaranty was procured by the fraudulent acts of plaintiff's agent, and whether "plaintiff breached a duty ... to reveal the material terms of the guaranty." In support of this argument, defendants contend that their subjective understanding of the guaranty was that their obligations extended only to the purchase of one truck, and not to all subsequent purchases made by B & A Transport. They further contend that they communicated this understanding to plaintiff's agent, who assured them that this was accurate. Finally, defendants point to the failure of plaintiff's agent to point out to them provisions of the guaranty directly contrary to this alleged misrepresentation.
We find defendants' argument in this regard entirely unpersuasive. The clear language of the guaranty, which defendants are presumed to have read and which defendants signed, in pertinent part provides:
The Undersigned, for a valuable consideration the receipt of which is hereby acknowledged, hereby guarantees payment, at maturity, of any and all indebtedness or obligations, whether primary or secondary, for which B & A Transport Co., Inc., of Mt. Airy, County of Surry and State of North Carolina, is now or may hereafter become liable or indebted to International Harvester Company or International Harvester Credit Corporation.
(emphasis added).
A person who executes a written instrument is ordinarily charged with knowledge of its contents, Mills v. Lynch, 259 N.C. 359, 130 S.E.2d 541 (1963), and may not base an action for fraud on ignorance of the legal effect of its provisions, Pierce v. Bierman, 202 N.C. 275, 162 S.E. 566 (1932). While these rules do not apply to situations in which the person making the misrepresentations stands in a fiduciary relationship to the signing party, Vail v. Vail, 233 N.C. 109, 63 S.E.2d 202 (1951), the relationship between a creditor and a guarantor is not such a relationship. In short, we hold that defendants' reliance, if any, on alleged misrepresentations made by plaintiff's agent was unreasonable as a matter of law. We further hold that plaintiff's agent had no duty to "disclose" to defendants the clear terms of the guaranty. The case relied on by defendants in support of their contention to the contrary involved a situation in which a creditor was allegedly aware of some fact that materially increased the guarantor's risk and which the creditor knew the guarantor probably would not discover. See Trust Co. v. Akelaitis, 25 N.C.App. 522, 214 S.E.2d 281 (1975). The principles set out in this case have no application to the facts here presented.
Defendants next contend that a genuine issue is presented as to whether the guaranty was supported by valid consideration. In this regard defendants make much of the fact that plaintiff had extended credit to B & A Transport prior to their execution of the guaranty. Because plaintiff's extension of credit was independent of the guaranty, defendants argue, the guaranty was without consideration and was thus unenforceable.
It is true, as defend...
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...of a written contract. Reliance on such misrepresentations is unreasonable as a matter of law. Int'l Harvester Credit Corp. v. Bowman, 69 N.C. App. 217, 219–220, 316 S.E.2d 619, 621 (1984) ; see Davis v. Davis, 256 N.C. 468, 471–73, 124 S.E.2d 130, 133–34 (1962) ; Isley v. Brown, 253 N.C. 7......
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