Personal guarantor’s loan liability: STRIKER GOLD CO., INC. V. FIRST SECURITY BANK OF LEXINGTON (COA 12/14/2007)

STRIKER GOLD CO., INC. V. FIRST SECURITY BANK OF LEXINGTON
BUSINESS LAW:  LOAN GUARANTY AND DISPOSITION OF ASSETS

2005-CA-000271
PUBLISHED: AFFIRMING
PANEL:  THOMPSON PJ; STUMBO, BUCKINGHAM CONCUR
COUNTY: JEFFERSON
DATE RENDERED: 12/14/2007

The COA affirmed summary judgment granted in favor of the creditor bank against Jones,the debtor, on the bank’s claim for a deficiency judgment against Jones resulting from his execution of two guaranty agreements for the security of Striker Golf’s debt obligations.

Jones had executed two guaranty agreements in which he assumed personal liability for Striker’s liabilities to First Security Bank up to a “maximum aggregate liability”of $36,000 and $72,000.  Striker’s assets were sold but were not enough to satisfy the loan.  The bank then went after Jones on the security agreements he signed.

Jones defended by attacking the lack of commercial reasonableness in the selling of Striker Golf’s assets.  However, beyond refusing to agree to the sale, Striker Golf and Jones did little more to legitimately contest the sale of the assets.  Because First Security accounted for the commercial circumstances of the sale, Striker Golf and Jones were required to do more than simply disagree with the court’s granting of the motion to dispose.   The failure of Striker Golf and Jones to contest the sale of the asset to Markham despite receiving detailed notice of the purchase is fatal to their appeal. Summary judgment affirmed.

Michael Stevens

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