Stonecrest Land, LLC v. Res-Ga Scl, LLC
333 Ga. App. 289
Ga. Ct. App.2015Background
- Stonecrest Land, LLC borrowed $15,937,000 under a promissory note with Integrity Bank; Brock and Mason guaranteed Stonecrest’s obligations.
- The loan was a balloon two-year note funded with a pre-paid interest carry; Integrity advanced funds to cover interest during construction.
- Integrity later ceased advancing interest; Stonecrest defaulted, and no payments were made by Stonecrest or the guarantors.
- FDIC appointed as receiver after Integrity’s FDIC receivership; FDIC accelerated the note and later assignments transferred to Multibank and then RES-GA.
- RES-GA filed suit in 2012 for breach of loan documents and guaranties; the trial court granted summary judgment in RES-GA’s favor in 2014.
- RES-GA sought attorney’s fees under Brock’s guaranty; Brock challenged, and the court ultimately awarded fees on appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| FIRREA exhaustion applicability to preserved defenses | RES-GA contends defenses are barred by FIRREA exhaustion (D)(13)(D). | Stonecrest/Brock argue defenses are true affirmative defenses not subject to exhaustion. | FIRREA exhaustion bars the asserted defenses; defenses deemed recoupment/offset are barred. |
| Whether defenses are recoupment/offset and barred by FIRREA | RECoupment/offset claims are claims against assets and subject to FIRREA. | Defenses are true affirmative defenses not requiring exhaustion. | Defenses categorized as recoupment are barred by FIRREA; partial/offset theories fail on merits. |
| Waiver of defenses by Brock in his guaranty | Guranty waived defenses; Brock cannot raise defenses to defeat enforcement. | Brock contends waived defenses cannot bar RES-GA’s claim. | Brock’s waiver is enforceable; defenses waived and RES-GA prevails on the note. |
| Attorney fees under OCGA 13-1-11 against Brock | Statutory fees are mandatory if prerequisites are met; notices were proper and after maturity. | Notices did not clearly identify who would file suit and timing issues; potential FIRREA issues. | Notices complied; RES-GA entitled to attorney fees against Brock; trial court erred in denying fees. |
| Default interest and FIRREA impact on judgment | RES-GA seeks default interest and related damages under the note. | Defenses against default interest barred by FIRREA exhaustion or meritless. | FIRREA exhaustion bars the defense; merits fail; default interest affirmed as part of judgment. |
Key Cases Cited
- Gravitt v. Bank of the Ozarks, 326 Ga. App. 461 (Ga. App. 2014) (FIRREA exhaustion limits jurisdiction over FDIC-related claims)
- Bobick v. Community & Southern Bank, 321 Ga. App. 855 (Ga. App. 2013) (distinguishes between basic/affirmative defenses and counterclaims under FIRREA)
- American First Fed. v. Lake Forest Park, 198 F.3d 1259 (11th Cir. 1999) (affirms exhaustion applicability to claims/offsets against FDIC assets; affirms that some defenses are not restricted to exhaustion depending on nature)
- Nat. Union Fire Ins. Co. of Pittsburgh, Pa. v. City Savings, 28 F.3d 376 (3d Cir. 1994) (defines distinction between claims/counterclaims and defenses under FIRREA)
- Placida Professional Center v. Fed. Deposit Ins. Corp., 512 F. App’x 938 (11th Cir. 2013) (addresses FIRREA exhaustion and administrative review limitations)