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Roberts v. Community & Southern Bank

Court of Appeals of Georgia

March 19, 2015

ROBERTS
v.
COMMUNITY & SOUTHERN BANK

Page 69

Cert. applied for.

Guaranty. Carroll Superior Court. Before Judge Kirby.

Smith Conerly, Charles S. Conerly, David A. Luzum, for appellant.

Thompson, O'Brien, Kemp & Nasuti, Bret T. Thrasher, William J. Shaughnessy, Shadrix Lane, Charles M. Lane, for appellee.

BARNES, Presiding Judge. Boggs and Branch, JJ., concur.

OPINION

Page 70

Barnes, Presiding Judge.

The trial court granted summary judgment to Community & Southern Bank (" Community Bank" or the " Bank" ) on its claim for breach of a personal guaranty against Oscar Roberts III, and awarded the Bank damages in the principal amount of $667,486.02, plus accrued and " secondary" interest, late charges, contractual attorney fees, and post-judgment interest. On appeal, Roberts contends that the trial court erred in granting summary judgment to the Bank on the issue of his liability under the guaranty because the underlying debt was invalid as a matter of law, or, at a minimum, there were genuine issues of material fact as to its legal validity. Roberts also contends that the trial court erred in granting summary judgment to the Bank on the issue of damages because the Bank relied upon an inadmissible " summary" of its business records to prove its damages, and because there was no evidence that the Bank was entitled to an award of " secondary" interest. For the reasons discussed below, we affirm on condition that the damages awarded to Community Bank be reduced to eliminate " secondary" interest and the portion of contractual attorney fees that was predicated on the award of such interest.

Summary judgment is proper if the pleadings and evidence " show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." OCGA § 9-11-56 (c). On appeal from a trial court's grant of summary judgment, we " conduct a de novo review, construing all reasonable inferences in the light most favorable to the nonmoving party." Bank of North Ga. v. Windermere Dev., 316 Ga.App. 33, 34 (728 S.E.2d 714) (2012).

So viewed, the record shows that on June 30, 2009, Roberts executed a promissory note in favor of First National Bank of Georgia (" First National" ) in the principal amount of $800,500 (the " Note" ). The Note provided that the principal balance would be due on June [331 Ga.App. 365] 30, 2010. The Note also set forth the applicable interest rate and when interest would accrue, the basis for assessing late charges, and the method for calculating attorney fees in the event of collection efforts made after a default.

The Note identified the borrower as the estate of Roberts's father (the " Estate" ). The Note was signed by Roberts as attorney-in-fact for his mother, the executrix of the Estate. Roberts had conducted negotiations with First National over the terms of the loan for the Estate, and he represented to First National that he had authority to execute the Note on behalf of his mother in her capacity as executrix. Roberts believed that he had authority to act on behalf of his mother in her capacity as executrix based on a power of attorney that had been signed by her in which she named him as her attorney-in-fact (the " Power of Attorney" ). Roberts showed the Power of Attorney to First National.

Upon execution of the Note, Roberts received the $800,500 loan from First National and used the money to purchase undeveloped real estate on behalf of the Estate. Although she was not present at the closing on the loan, Roberts's mother knew that he had executed the Note and did not object to him borrowing money to buy property on behalf of the Estate.

On the same day that he executed the Note, Roberts executed a personal guaranty in favor of First National (the " Guaranty" ). Roberts " absolutely and unconditionally guarantee[d]" the Estate's payment of the debt owed to First National as evidenced by the Note. Roberts further agreed in the Guaranty that his obligation to repay the debt owed by the Estate would " not be affected by the illegality, invalidity, or unenforceability of any notes or agreements evidencing the debt ... or any other circumstances which make the indebtedness unenforceable against the ...


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