ILNews

Law clear only guarantor's signature needed

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The Indiana Court of Appeals ruled on a guaranty issue today that is "so well-settled" in state law that the judges had difficulty finding recent cases restating it.

Debra Sullivan argued in Grabill Cabinet Co. Inc. v. Debra C. Sullivan, No. 02A03-0908-CV-399, that because Grabill Cabinet Co. didn't also sign a personal guaranty Sullivan had with the company, the guaranty was invalid. Sullivan signed the personal guaranty while she was an employee with Kitchens, Baths, & More, which guaranteed any repayment of debt KBM may have with the cabinet company. When KBM didn't pay on a balance, Grabill tried to collect from Sullivan. Sullivan had since left the company but didn't send Grabill any notice of termination of her personal guaranty.

The trial court granted summary judgment for Sullivan on the issue of enforceability of the guaranty.

The appellate judges disagreed with Sullivan's argument because the Indiana Statute of Frauds requires only that the party against whom the action is brought has to sign the written guaranty.

"Indeed, this seems to be one of those propositions so well-settled in Indiana law that it is difficult to find recent cases restating it," wrote Judge Cale Bradford. "Our Statute of Frauds has existed in substantially the same form, at least as it pertains to guaranties, for well over a century."

There is somewhat of a conflict between Indiana caselaw and the Statute of Frauds, and Sullivan relied on a ruling that required three parties to "execute" a guaranty for it to be valid. But signing a written guaranty isn't necessary for it to be executed and the Statute of Frauds has made it clear only the guarantor's signature is required.

The three Court of Appeals opinions that arguably define a signing requirement onto guaranties conflict with the plain language of the Statute of Frauds and Indiana Supreme Court precedent, the judge continued.

"If the Indiana Supreme Court wishes to graft new signing requirements onto guaranties beyond those mentioned in the Statute of Frauds, it may do so. As yet, however, the Court has not, and we are absolutely bound by its decisions in this regard," Judge Bradford wrote.

The appellate court reversed summary judgment for Sullivan and remanded for entry of summary judgment for Grabill on the issue and for calculation of the company's award.

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  1. Im very happy for you, getting ready to go down that dirt road myself, and im praying for the same outcome, because it IS sometimes in the childs best interest to have visitation with grandparents. Thanks for sharing, needed to hear some positive posts for once.

  2. Been there 4 months with 1 paycheck what can i do

  3. our hoa has not communicated any thing that takes place in their "executive meetings" not executive session. They make decisions in these meetings, do not have an agenda, do not notify association memebers and do not keep general meetings minutes. They do not communicate info of any kind to the member, except annual meeting, nobody attends or votes because they think the board is self serving. They keep a deposit fee from club house rental for inspection after someone uses it, there is no inspection I know becausee I rented it, they did not disclose to members that board memebers would be keeping this money, I know it is only 10 dollars but still it is not their money, they hire from within the board for paid positions, no advertising and no request for bids from anyone else, I atteended last annual meeting, went into executive session to elect officers in that session the president brought up the motion to give the secretary a raise of course they all agreed they hired her in, then the minutes stated that a diffeerent board member motioned to give this raise. This board is very clickish and has done things anyway they pleased for over 5 years, what recourse to members have to make changes in the boards conduct

  4. Where may I find an attorney working Pro Bono? Many issues with divorce, my Disability, distribution of IRA's, property, money's and pressured into agreement by my attorney. Leaving me far less than 5% of all after 15 years of marriage. No money to appeal, disabled living on disability income. Attorney's decision brought forward to judge, no evidence ever to finalize divorce. Just 2 weeks ago. Please help.

  5. For the record no one could answer the equal protection / substantive due process challenge I issued in the first post below. The lawless and accountable only to power bureaucrats never did either. All who interface with the Indiana law examiners or JLAP be warned.

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