Community Magazine, LLC v. Color Xpress
326 Ga. App. 330
| Ga. Ct. App. | 2014Background
- Color Xpress (a trade name of a sole proprietor) sued Community Magazine LLC and Ed Chapman on an open account, seeking $89,842.33 in principal (plus interest) for printing services through Dec. 31, 2010.
- Attached to the complaint: a multi-page account statement and a one-page document signed by Chapman in Aug. 2010 titled “Authorization to Obtain Bank Credit Information” that also contained a short “Personal Guaranty” referencing the “above purchaser” and a Credit Application.
- Color Xpress moved for summary judgment supported by an affidavit from owner Harold Motter asserting the $89,842.33 balance (an email referenced a similar past-due amount). Chapman responded pro se, disputing the guaranty and the amount, and submitted an affidavit without specific contrary figures.
- The trial court granted summary judgment to Color Xpress; Chapman and Community Magazine appealed.
- The appellate court reviewed summary judgment de novo and examined (1) whether Chapman’s signed document satisfied the Statute of Frauds for a guaranty, (2) whether Community Magazine’s debt on the open account was established, and (3) whether the suit was void because Color Xpress is a trade name rather than a legal entity.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Chapman signed an enforceable personal guaranty (Statute of Frauds) | The one‑page signed document constitutes a guaranty binding Chapman for Community Magazine’s debts | Chapman argues the guaranty is unenforceable: it fails to identify the principal debtor, promisee, and lacks a complete credit application | Reversed as to Chapman — the guaranty fails the Statute of Frauds because it does not identify the principal debtor or necessary parties and parol evidence cannot cure it |
| Whether Community Magazine owes the stated open‑account balance | Color Xpress says Motter’s affidavit plus account statement establish a prima facie debt of $89,842.33 | Community Magazine contends the balance is disputed and not proven; offered no verified, specific contrary figures | Affirmed as to Community Magazine — plaintiff established a prima facie case and defendant failed to produce specific evidence creating a material fact issue |
| Whether the suit is void because Color Xpress is a trade name (no legal entity) | Color Xpress acknowledges it is a trade name of a sole proprietor and relied on documents using that name | Defendants argue suits in a trade name are nullities and must be dismissed | Affirmed for plaintiff: failure to timely raise the capacity issue below, and under Block the trade name can be treated as a misnomer amendable to show the real party in interest |
Key Cases Cited
- Matjoulis v. Integon Gen. Ins. Corp., 226 Ga. App. 459 (Ga. Ct. App. 1997) (summary judgment review and affidavit sufficiency principles)
- Block v. Voyager Life Ins. Co., 251 Ga. 162 (Ga. 1983) (trade‑name misnomer may be corrected; pleadings may be amended to substitute real party)
- Brand v. Southern Employment Svc., 247 Ga. App. 638 (Ga. Ct. App. 2001) (cases holding trade names that do not reveal the real party may be treated as misnomers but cautioning pre‑Block holdings)
- Johnson & Johnson Constr. Co. v. Pioneer Neon Supply Co., 96 Ga. App. 867 (Ga. Ct. App. 1958) (suit brought in trade name may be amended to show the natural person carrying on the business)
- Western & Atlantic R. Co. v. Dalton Marble Works, 122 Ga. 774 (Ga. 1905) (older precedent describing suits brought in names that are not legal entities as nullities)