PlayNation Play Systems, Inc. v. Jackson
312 Ga. App. 340
| Ga. Ct. App. | 2011Background
- PlayNation sued Jackson on a personal guaranty for debts of Swingset Planet, a Pennsylvania LLC involved in selling/installation of playground equipment.
- Jackson and Gerald Flanagan owned The Bottom Line, which operated as Swingset Planet and later used the d/b/a PlayNation Parties.
- A 2006 dealership agreement between Swingset Planet and PlayNation preceded the guaranty; Jackson executed the guaranty a month after signing the dealership agreement.
- In 2008, PlayNation licensed its name and The Bottom Line renamed to PlayNation Parties, continuing the same business activities.
- PlayNation Parties failed to pay invoices; PlayNation sued for breach of the guaranty, interest, and attorney fees; both sides moved for summary judgment.
- The trial court granted Jackson summary judgment, holding the guaranty did not extend to debts of PlayNation Parties since the guaranteed debtor named was Swingset Planet.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the guaranty cover debts of PlayNation Parties? | PlayNation: guaranty covers the related entity via trade names/affiliations. | Jackson: guaranty names Swingset Planet as the debtor; no coverage for PlayNation Parties. | Guaranty limited to Swingset Planet; not extended to PlayNation Parties. |
| Does a mere name change/trade name alter the guaranty obligation? | PlayNation contends business identity remains within guarantied obligation. | Jackson: guaranty identifies a specific debtor; name changes do not alter liability. | Name change did not expand guarantor's liability; no liability for PlayNation Parties. |
Key Cases Cited
- Rohm & Haas Co. v. Gainesville Paint & Supply Co., 225 Ga.App. 441 (Ga. Ct. App. 1997) (guaranty definition and enforceability principles)
- Cox v. U.S. Markets, 278 Ga.App. 287 (Ga. Ct. App. 2006) (guaranty must identify debt, principal debtor, guarantor, creditor)
- Caves v. Columbus Bank, etc., Co., 264 Ga.App. 107 (Ga. Ct. App. 2003) (strict construction of guaranties in favor of guarantor)
- American Express Travel, etc. v. Berlye, 202 Ga.App. 358 (Ga. Ct. App. 1991) (immaterial change in corporate description generally; but distinguishable from case where agent identity changed)
- Peara v. Atlanta Newspapers, 120 Ga.App. 163 (Ga. Ct. App. 1969) (guarantee scope limits liability to named division/entity)
- Berlye v. American Express Travel, etc., 202 Ga.App. 358 (Ga. Ct. App. 1991) (change in debtor description can be immaterial, but analysis depends on who is identified in guaranty)