Mashburn Construction, L.P. v. CharterBank
340 Ga. App. 580
| Ga. Ct. App. | 2017Background
- In 2007 Mashburn Construction borrowed $958,690 from McIntosh Commercial Bank (MCB); Mashburn and Denney gave unconditional personal guarantees and the note was secured by Fulton County real property.
- Borrower defaulted; successor CharterBank foreclosed and property sold on September 7, 2010 for $725,000; Fulton County superior court confirmed the foreclosure sale as reflecting true market value.
- CharterBank sued for a deficiency judgment for the unpaid balance on the note; Appellants denied further liability and moved to defend based on an alleged short-sale agreement and objections to CharterBank’s damage calculations.
- CharterBank moved for summary judgment supported by manager Chandler’s affidavits and attached spreadsheets (Exhibits G, H, O, P); Chandler later admitted errors in Exhibit H and supplied corrected Exhibit O and loan history Exhibit P.
- Appellants asserted evidentiary and calculation defects (hearsay and inconsistent spreadsheets) and claimed estoppel based on an alleged short-sale promise; no transcript of the summary-judgment hearing was included in the appellate record.
Issues
| Issue | Plaintiff's Argument (CharterBank) | Defendant's Argument (Mashburn et al.) | Held |
|---|---|---|---|
| Whether trial court erred by ignoring evidence of a short-sale agreement that would estop CharterBank from seeking a deficiency | CharterBank: no estoppel; foreclosure and confirmation were valid; no transcript shows trial court ignored evidence | Appellants: CharterBank agreed to accept short-sale proceeds and forgive deficiency, then breached by foreclosing | Court: Appellants failed to include hearing transcript, so must assume trial court had adequate basis; no reversal on this ground |
| Admissibility of CharterBank’s corrected damage spreadsheet (Exhibit O) under business-records hearsay exception | CharterBank: Exhibit O is a business record supporting damages | Appellants: Exhibit O is hearsay and inadmissible | Court: Appellants waived the hearsay objection by failing to preserve it in the trial court or include a transcript; objection deemed waived |
| Whether CharterBank proved damages with required certainty (amount of deficiency) | CharterBank: affidavit and attached Excel/loan-history show amounts owed | Appellants: Exhibits contain calculation errors, internal inconsistencies, and Exhibit O stops in 2011 while affidavit cites 2014 balance | Court: Material discrepancies between Exhibits O and P and missing attachments create genuine issues of fact as to amount; summary judgment on amount reversed |
| Whether interest-rate evidence was ambiguous so parol evidence could alter rate | CharterBank: note unambiguously ties rate to lender’s base rate; bank records show lender’s prime changes and rates set by committee | Appellants: former CEO’s affidavit says lender’s prime meant WSJ prime (contradicting bank evidence) | Court: Note unambiguous; parol evidence (Gafford) cannot vary it; summary judgment as to liability and applicable interest rates affirmed |
Key Cases Cited
- Benton v. Benton, 280 Ga. 468 (addresses de novo review on summary judgment)
- Boles v. Lee, 270 Ga. 454 (failure to include transcript means appellate court assumes trial court acted properly)
- Patrick Malloy Communities v. Community & Southern Bank, 334 Ga. App. 76 (plaintiff must prove damages with reasonable certainty)
- Kothari v. Patel, 262 Ga. App. 168 (parol evidence cannot vary unambiguous promissory note)
- Powers v. Hudson & Keyse, 289 Ga. App. 251 (affidavits relying on records must attach those records)
- Fowler v. Ford Motor Credit Co., 180 Ga. App. 738 (calculation errors in creditor’s submission can defeat summary judgment on amount owed)