Kensington Partners, LLC v. Beal Bank Nevada
311 Ga. App. 196
| Ga. Ct. App. | 2011Background
- On May 25, 2006 Kensington Partners executed a promissory note to BankFirst for $7,345,000; guaranties were signed by Steven DeFrancis, David DeFrancis, and Regis Haid, Jr.
- The note was secured by a deed of trust on Mississippi real estate.
- Beal Bank Nevada acquired the loan by assignment from the FDIC, acting as receiver for BankFirst.
- The trial court granted Beal Bank summary judgment for $6,977,750 plus interest and attorney fees based on the note and guaranties.
- Kensington and the guarantors challenged the assignment and the guaranties’ transfer, and contested the amount and interest calculated.
- The court held there was a valid assignment from the FDIC and that the guaranties were effectively assigned, applying Georgia law and upholding the computed amounts.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Beal Bank validly received the loan assignment | Beal lacked evidence of BankFirst’s failure and FDIC receiver appointment. | Kensington admitted BankFirst failed and FDIC became receiver; evidence shows valid assignment. | Yes; assignment valid |
| Whether the guaranties were validly assigned to Beal Bank | No express assignment of guaranties shown. | Guaranties transferred via FDIC assignment of the note and related documents; a transfer of the note operates as an assignment of the guaranties. | Yes; guaranties effectively assigned |
| Whether Mississippi law or Georgia law governs due to foreign-law considerations | Mississippi law should apply to the transfer and guaranty questions. | Notice of foreign-law issue was insufficient; Georgia law applies. | Georgia law applies |
| Whether the amount of indebtedness and interest were properly established | Disputed principal balance and interest calculations require more documentation. | Affidavits and payment history establish principal, interest, and proper calculation under the note. | Yes; evidenced by affidavits and payment history |
| Whether attorney fees were properly awarded under the correct law | Mississippi law should govern attorney-fee entitlement. | No proper notice of foreign-law issue; Georgia law applies to attorney fees. | Georgia law applied; fees affirmed |
Key Cases Cited
- Mitsubishi Motors Corp. v. Colemon, 290 Ga.App. 86 (2008) (admissions in judicio bind party; evidentiary admissions)
- Holmes v. Clear Channel Outdoor, 298 Ga.App. 178 (2009) (binding admissions principle in pleadings)
- Milestone v. David, 251 Ga.App. 832 (2001) (allonge admissible endorsements; evidence of assignment)
- Green v. Cavalry Portfolio Svcs., 305 Ga.App. 843 (2010) (no valid assignment; summary judgment error)
- Ovihp, Inc. v. Blockbuster Textiles, 289 Ga.App. 276 (2008) (affidavit-based calculations sustain summary judgment)