2014 Ohio 240
Ohio Ct. App.2014Background
- McDermott Industries, L.L.C. and the Pertusets guaranteed a board-promoted promissory note, which McDermott and its guarantors defaulted on; the board sued to recover the due amount; the trial court granted summary judgment for the board.
- The board filed to collect $148,612.77 plus 10% interest from June 15, 2009, and late charges, asserting the board held the note and guarantees.
- Pertusets denied the board’s standing and their personal liability, filing various objections and challenges to standing before the court.
- The board submitted an affidavit by its records custodian confirming holder status and the default; Pertusets failed to rebut with specific facts.
- McDermott’s dissolution occurred after the note was executed; dissolution did not nullify liability because the guarantors remained personally liable and the dissolution did not affect the board’s assertable rights.
- The trial court’s summary judgment was affirmed, finding the board had standing, amount due proven, and no genuine issues of material fact.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the board had standing to sue | Pertuset argues lack of standing | Pertusets challenge board’s status as holder | Board had standing; holder/real party in interest |
| Whether dissolution timing affected enforceability | Board’s claim unaffected by dissolution | Dissolution could negate liability | Dissolution after note execution does not divest liability; guarantees remain enforceable |
| Whether the amount due was established | Affidavit and note prove damages | Possibly insufficient evidence of amount | Amount due proven; no genuine issue as to amount |
| Whether guarantees and procedural posture support summary judgment | Guaranties render board entitled to judgment | Issues raised about GAAP/GAAS and standing | Summary judgment proper; defenses insufficient |
Key Cases Cited
- Groveport Madison Local Schools Bd. of Edn. v. Franklin Cty. Bd. of Rev., 137 Ohio St.3d 266 (2013-Ohio-4627) (standing at issue; real party in interest standards)
- U.S. Bank Natl. Assn. v. Kafantaris, 11th Dist. Trumbull No. 2011-T-0002, 2011-Ohio-5601 (2011-Ohio-5601) (holder on note has standing; real party in interest)
- Pratts v. Hurley, 102 Ohio St.3d 81 (2004-Ohio-1980) (defining standing in suits)
- State ex rel. Tubbs Jones v. Suster, 84 Ohio St.3d 70 (1998) (standing vs. subject-matter jurisdiction)
- Ohio Valley Resource Conservation & Development v. Pertuset, 2013-Ohio-5406 (2013) (pro se challengers’ failure to raise Civ.R. 56 issues)
- Bendure v. Xpert Auto, Inc., 2011-Ohio-6058 (2011) (dissolution after judgment; liability may continue)
- Wells Fargo Bank, N.A. v. Byrd, 178 Ohio App.3d 285 (2008-Ohio-4603) (standing where holder filed complaint)
- Farm Credit Servs. of Mid. Am. v. Pertuset, 2013-Ohio-567 (2013) (proceedings involving related guaranty disputes)
- Am. Savings Bank v. Pertuset, 2013-Ohio-566 (2013) (related guaranty/enforcement considerations)
- Quality Car & Truck Leasing, Inc. v. Pertuset, 2013-Ohio-1964 (2013) (related procedural posture and arguments)