McIntyre Elec. Service, Inc. v. SouthTrust Bank of Mobile
| Decision Date | 19 September 1986 |
| Citation | 495 So.2d 1043 |
| Parties | McINTYRE ELECTRIC SERVICE, INC., and D.E. McIntyre v. SOUTHTRUST BANK OF MOBILE. 84-532. |
| Court | Alabama Supreme Court |
Lester L. McIntyre, Mobile, for appellant.
J.M. Druhan and D. Charles Holtz of Wilkins, Druhan & Ollinger, Mobile, for appellee.
This appeal arises from a summary judgment for counter-defendant bank on a counterclaim seeking damages for fraud. SouthTrust Bank of Mobile sued McIntyre Electric Service, Inc., (McIntyre Electric) and D.E. McIntyre for sums due on various notes. McIntyre Electric and McIntyre counterclaimed, alleging that SouthTrust, through its agent Rick L. Chastain, misrepresented that it would "stand behind McIntyre financially in order that McIntyre Electric might reach financial stability." The counterclaim alleges that SouthTrust's actions of May 20, 1983, in calling in its loans, asking McIntyre Electric's debtors to make payments to SouthTrust, and setting off the amounts in McIntyre Electric's account against its debt to SouthTrust, demonstrate the falsity of SouthTrust's assurances that it would assist McIntyre Electric financially.
The court also granted summary judgment for SouthTrust on its complaint. McIntyre Electric and McIntyre did not appeal from that judgment, however, so no issue regarding it is before us.
McIntyre Electric used the banking services of, and borrowed money from, SouthTrust for eight or nine years prior to the events giving rise to this lawsuit. In 1980 and 1981, McIntyre Electric experienced financial difficulties, which led to a large balance due SouthTrust in the summer of 1982. McIntyre Electric's debt to SouthTrust was $206,436.85 on August 30, 1982; $204,015.33 at the end of September; and $149,651.89 about the end of October. On October 29, 1982, McIntyre Electric executed a 180-day note for $90,000.00, and apparently a 30-day note for either $40,000.00 or $49,000.00. The latter note is not in the record, but SouthTrust argues that the two notes reflect part of a transaction by which McIntyre Electric's debt was reduced to $130,000.00. The materials submitted on the summary judgment motion leave an ambiguity as to whether the 30-day note was for $40,000.00 or $49,000.00, and do not give any clear indication that a payment was made to reduce the balance from $149,651.89 to $130,000. McIntyre, by affidavit, stated that the debt was $149,651.89 at the end of October and $144,127.42 at the end of November.
The amount due at this period is significant with respect to McIntyre Electric's debt on May 20, 1983, when Chastain cancelled McIntyre Electric's credit. Notes totalling $331,859.38 were due before or shortly after May 20, 1983. McIntyre stated in his affidavit that Chastain's own calculations showed the net amount due SouthTrust was $148,468.21. It does appear that SouthTrust's collection of sums due to McIntyre Electric reduced the debt to this amount. McIntyre and McIntyre Electric allege that, contrary to Chastain's assertion that he cancelled the credit because McIntyre Electric owed more after SouthTrust attempted to help McIntyre Electric improve its financial position than it did before, McIntyre Electric owed SouthTrust approximately the same amount but had improved its business prospects by paying past due payroll taxes and accounts payable which McIntyre Electric had owed in October 1982. The counterclaim alleges that Chastain's abrupt cancellation of the credit demonstrates the falsity of the earlier representations that SouthTrust would aid McIntyre in regaining financial stability.
McIntyre and Chastain engaged in discussions in the fall of 1982 as to whether McIntyre Electric should stop operating or continue in business. McIntyre Electric had an opportunity to bid for a large electrical subcontract with Payne & Keller Gulf Coast, Inc., on a job for which Payne & Keller was the general contractor. Chastain, McIntyre, and a representative of Payne & Keller met over lunch sometime in November, at which time it was agreed that SouthTrust would continue to extend credit to McIntyre Electric so McIntyre could bid on the contract and attempt to improve its financial position....
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