Whitney Bank v. Christopher Robert Carbine and Joseph D. SandoWhitney Bank v. Christopher Robert Carbine and Joseph D. Sando
APPEAL FROM CIVIL DISTRICT COURT, ORLEANS PARISH NO. 2018-01361, DIVISION “D” Hоnorable Nakisha Ervin-Knott, Judge
JAMES F. MCKAY III CHIEF JUDGE
(Court composed of Chief Judge James F. McKay III, Judge Terri F. Love, Judge Dale N. Atkins)
WILLIAM T. FINN
PETER J. SEGRIST
CARVER DARDEN KORETZKY TESSIER FINN BLOSSMAN & AREAUX, LLC
1100 Poydras Street, Suite 3100
New Orleans, Louisiana 70163
COUNSEL FOR PLAINTIFF/APPELLEE HANCOCK WHITNEY
DOUGLAS M. SCHMIDT
PETER R. BORSTELL
RICCI PARTNERS, LLC
335 City Park Ave.
New Orleans, Louisiana 70119
COUNSEL FOR DEFENDANT/APPELLANT JOSEPH D. SANDO
AFFIRMED
JUNE 24,
On June 26, 2014, Joseph D. Sando executed a commercial guaranty agreement in favor of Hancock Whitney Bank (“Whitney“), whereby he personally guaranteed the current and future indebtedness of Chris Carbine, Inc. (“Carbine Motorcars“), a Louisiana Corporation engaged in the business of selling luxury automobiles. On September 26, 2015, Carbine Motorcars executed a promissory note in the original principal amount of onе million dollars ($1,000,000.00), due and payable with interest to the order of Whitney. Carbine Motorcars failed to keep up its payments on the note in accordance with the terms thereof. On October 13, 2017, Whitney made demand upon Carbine Motorcars and Mr. Sando, notifying them that the full amount of the indebtedness was due immediately. Neither Carbine Motorcars, nor Mr. Sando made any payments in response to Whitney‘s demand.
On February 9, 2018, Whitney filed suit against Mr. Sando for unpaid principal, interest, fees, costs and attorneys’ fees under the guaranty.1 Mr. Sando
filed a
Regarding Mr. Sando‘s reconventional demand, Whitney and Ms. Suarage filed a number of exceptions, including: declinatory exceptions of lis pendens; peremptory exceptions of no cause of action and prescription; and dilatory exceptions of vagueness, ambiguity and nonconformity with
On October 23, 2018, Whitney filed a motion for summary judgment against Mr. Sando to enforce his obligations under the guaranty. A hearing on the motion for summary judgment was originally set for December 14, 2018. On December 6, 2018, Mr. Sando filed a motion to continue for medical reasons and becаuse he needed to take the depositions of Ms. Suarage and Mr. Elliott. The district court granted the continuance and reset the hearing on the motion for summary judgment to February 1, 2019.
Mr. Sando propounded notices of deposition upon Ms. Suarage and Mr. Elliott, seeking to take their depositions on January 15, 2019. Ms. Suarage and Mr. Elliott, along with Whitney, filed a motion to quash the deposition notices. Following a January 11, 2019 hearing, the district court quashed Mr. Sando‘s deposition notices based upon his admission that he had guaranteed the debt of Carbine Motorcars when he signed the guaranty. The court also recognized his failure to identify a single genuinely disputed issue of material fact, a valid affirmative defense, and/or any other justifiable reason for needing the depositions of Ms. Sauragе and Mr. Elliott. Seeking review of the district court‘s judgment, Mr. Sando took a supervisory writ, which this Court denied.3
The hearing on Whitney‘s motion for summary judgment took place on February 1, 2019. The court granted the motion and awarded Whitney the principal amount due on the note of $934,063.31, plus interest, costs and fees, in accordance with the terms thereof. Thereafter, Mr. Sando filed a motion for new trial, which the court denied on April 12, 2019. Mr. Sando now appeals the trial court‘s judgment granting Whitney‘s motion for summary judgment.
In his first assignment of error, Mr. Sando contеnds that the trial court erred in not allowing him an opportunity to amend his pleadings to remedy the objections raised by the exception of no cause of action. The peremptory exception of no cause of action tests the legal sufficiency of a plaintiff‘s petition, i.e., whether the plaintiff is legally entitled to the relief sought under the allegations set forth on the face of the petition. Badeaux v. Southwest Computer Bureau, Inc., 2005-0612, p. 7 (La. 3/1/06), 929 So.2d 1211, 1217; See
The exception thus “questions whether the law extends a remedy to anyone under the factual allеgations of the petition.” Villareal v. 6494 Homes, LLC, 48,302, p. 5 (La. App. 2 Cir. 8/17/13), 121 So.3d 1246, 1250. The exception is tried on the face of the pleadings, and no evidence may be offered to support or controvert the exception.
In his reconventional demand, Mr. Sando alleged that Whitney and its former employees made various oral agreements with him, and that Whitney and its former employees subsequently breached those alleged agreements. Mr. Sando has never alleged that these alleged oral agreements were memorialized in any written agreement between him and Whitney.
“As a reaction against the situation arising from the increase in litigation instituted by aggrieved borrowers, special legislatiоn was enacted in Louisiana, as in other states, for the purpose of ordering the lender-borrower relation in a manner that would diminish the number of disputes between such parties.”4 The Louisiana Credit Agreement Statute5, enacted in 1989, provides that “[a] debtor shall not maintain an action on a credit agreement unless the agreement is in writing, expresses consideration, sets forth the relevant terms and conditions, and is signed by the creditor and the debtor.”
In his second assignment of error, Mr. Sando contends that the trial court erred in not allowing him to take the depositions of Ms. Suarage and Mr. Elliott, who were and/or still are employed by Whitney аs vice-presidents, who acted on its behalf, regarding the loan(s) made to Carbine Motorcars and the guarantees signed by Christopher Robert Carbine and Mr. Sando. In Louisiana, “the trial court has broad discretion in ruling on discovery matters.” Stolzle v. Safety & Systems Assur. Consultants, Inc., 2002-1197, p. 4 (La. 5/24/02), 819 So.2d 287, 289. The trial judge is likewise “vested with a great deal of discretion in limiting the right of parties to take discovery depositions.” Brewer v. Loewer, 383 So.2d 1325, 1327 (La. App. 3 Cir. 1980). “In its discretion, a court can refuse or limit discovery of matters not relevant, unreasonably vexatious, or tardily sought.” Belonga v. Crescent City Dodge, LLC, 2000-3419, p. 2 (La. 3/9/01), 781 So.2d 1247, 1248. “Trial courts in Louisiana have broad discretion when regulаting pre trial discovery. This discretion will not be disturbed on appeal absent a clear showing of abuse.” Cantuba v. American Bureau of Shipping, 2008-0497, p. 4 (La. App. 4 Cir. 6/3/09), 31 So.3d 397, 400. Mr. Sando has never articulated any good faith basis for requiring the depositions of the former employees. He never initiated a discovery conference, nor filed a motion to compel. In his own pleadings, Mr. Sando admits that he signed the guaranty, and Carbine Motorcars’ indebtedness is past due and owing. There is no hypothetical testimony that either Ms. Suarage or Mr. Elliott could offer that wоuld alter these undisputed, dispositive facts. Accordingly, we find no abuse of discretion in the trial court not giving Mr. Sando an opportunity to amend his petition.
In his third assignment of error, Mr. Sando contends that the trial court erred in granting Whitney summary judgment and a monetary judgment, while in his fourth assignment of error, he contends that the trial court erred in not finding material issues of fact and law precluding summary judgment. Motions for summary judgment are “favored and shall be construed to accomplish” the “just speedy, and inexpensive determination of every action.”
Louisiana courts routinely grant lenders’ motions for summary judgment аgainst guarantors upon proof of both the existence of an underlying debt and the guarantor‘s signature upon a guaranty agreement covering that debt. See Gulf Coast Bank and Trust Co. v. Elmore, 2010-1237 (La. App. 4 Cir. 1/26/11), 57 So.3d 553. “When the words of a contract are clear and explicit and lead to no absurd consequences, no further interpretation may be made in search of the parties’ intent.”
In the instant case, the guaranty provides that Mr. Sando “absolutely and unconditionally guarantees full and punctual payment and satisfaction of the Indebtedness of [Carbine Mоtorcars] . . . to [Whitney], and the performance and discharge of all [Carbine Motorcars‘] obligations under the Note and the Related Documents.” Mr. Sando agreed that his “obligations and liability under [the guaranty] shall be on a ‘solidary’ or ‘joint and several’ basis alоng with [Carbine Motorcars] to the same degree and extent as if [Mr. Sando] had been and/or will be a co-borrower, co-principal obligor and/or co-maker of [Carbine Motorcars‘] Indebtedness.” The guaranty further provides that “[Mr. Sando‘s] liability is unlimited and [his] obligаtions are continuing.” As such, the plain language of the guaranty shows
Whitney attached the guaranty to its motion for summary judgment. Mr. Sando admits in his answer and reconventional demand that he executed the guaranty. He further admits that Carbine Motorcars defaulted on the loan, and it is undisputed that Carbine Motorcars’ indebtedness to Whitney is past due and owing. Therefore, under the clear and unambiguous tеrms of the guaranty and the undisputed summary judgment evidence, Mr. Sando is obligated to pay to Whitney the entirety of Carbine Motorcars’ debt on demand. Accordingly, there are no genuine issues of material fact and Whitney is entitled to judgment as a matter of law.
In his fifth and final аssignment of error, Mr. Sando contends that the trial court erred in not finding material issues of fact and law precluding summary judgment when the security was impaired and therefore, the suretyship was extinguished. Mr. Sando argues that he should be relieved of his obligations under the guaranty because (1) he is an ordinary surety, and (2) the “real security underlying the obligation was impaired by the creditor Appellee Whitney Bank without [Mr. Sando‘s] consent or knowledge[.]” Mr. Sando‘s position is mistakenly based upon
The modification or amendment of the principal obligation, or the impairment of real security held for it, by the creditor, in any material manner and without the consent of the surety, has the following effects.
An ordinary suretyship is extinguished.
A commercial suretyship is extinguished to the extent the surety is prejudiced by the action of the creditor. . . .
Mr. Sando is a commercial, not an ordinary, surety. “A commercial suretyship is one in which . . . (2) the principal obligor . . . is a business corporation, partnership, or other business entity [or] (3) [t]he principal obligation arises out of a commercial transaction of the principal obligor[.]” It is undisputed that the principal obligor, Carbine Motorcars, was a business entity, and that the principal obligation (the indebtedness under the note) arose out of a commercial transaction of Carbine Motorcars. The guaranty itself was also entitled “Commercial Guaranty.” Accordingly, Mr. Sando is a commercial surety.
In any event, there is no evidence that Whitney impaired the vehicle inventory that secured the note, and, even if Whitney had, Mr. Sando specifically consented in writing so that Whitney could manage, sell, exchange, dispose of, surrender, release, and/or “otherwise deal with” any and all collateral securing the note. As a result, Mr. Sando has waived any purported right under
For the above and foregoing reasons, we affirm the judgment of the trial court.
AFFIRMED