HANCOCK BANK v. BOYD BROTHERS INC et al
ORDER granting 63 Motion for Judgment as a Matter of Law as to the individual defendants JAMES A BOYD, SR, NANCY G BOYD, JAMES A BOYD, JR and CECELIA R BOYD; denying as moot 90 Motion for Judgment on the Pleadings. The cases remain stayed as to Defendant BOYD BROTHERS INC, pending resolution of its bankruptcy. This order does not apply to Defendant BOYD BROTHERS INC. Plaintiff shall submit the current balances of the outstanding indebtedness with principal, accrued interest, and daily accrued interest rate. The clerk will then enter judgments in favor of Plaintiff against the individual defendants in that amount. Signed by JUDGE RICHARD SMOAK on 12/22/2011. (jem)
IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF FLORIDA
PANAMA CITY DIVISION
HANCOCK BANK, a Mississippi
CASE NO. 5:11-cv-94/RS-CJK
BOYD BROTHERS, INC., a Florida corporation;
JAMES A. BOYD, SR.; NANCY G. BOYD;
JAMES A. BOYD, JR.; and
CECELIA R. BOYD,
Before me are Plaintiff’s Motion for Summary Final Judgment (Doc. 63) and
Defendants’ Response in Opposition (Doc. 82).
Standard of Review
Summary judgment is appropriate when “there is no genuine issue as to any
material fact and . . . the movant is entitled to judgment as a matter of law.” Fed. R. Civ.
P. 56 (c). In other words, the basic issue before the court is “whether the evidence
presents a sufficient disagreement to require submission to a jury or whether it is so onesided that one party must prevail as a matter of law.” Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 251, 106 S. Ct. 2505, 2512 (1986). The moving party has the burden of
showing the absence of a genuine issue as to any material fact, and in deciding whether
the movant has met this burden, the court must view the movant’s evidence and all
factual inferences arising from it in the light most favorable to the nonmoving party.
Adickes v. S.H. Kress & Co., 398 U.S. 144 (1970); Fitzpatrick v. City of Atlanta, 2 F.3d
1112, 1115 (11th Cir. 1993). Thus, if reasonable minds could differ on the inferences
arising from undisputed facts, then a court should deny summary judgment. Miranda v. B
& B Cash Grocery Store, Inc., 975 F.2d 1518, 1534 (11th Cir. 1992) (citing Mercantile
Bank & Trust v. Fidelity & Deposit Co., 750 F.2d 838, 841 (11th Cir. 1985)). However,
a mere ‘scintilla’ of evidence supporting the nonmoving party's position will not suffice;
there must be enough of a showing that the jury could reasonably find for that party.
Walker v. Darby, 911 F.2d 1573, 1577 (11th Cir. 1990) (citing Anderson, 477 U.S. at
Plaintiff and Defendant Boyd Brothers, Inc. are parties to at least six separate loan
agreements. Defendant Boyd Brothers, Inc. is in bankruptcy and a stay has been entered
as to that defendant. (See Doc. 74). The individual defendants personally guaranteed
these loans. Plaintiff claims that the loans are in default, and the personal guaranties have
not been satisfied. For clarity, each of the loans will be discussed in turn.
I . LOAN 1 (5:11-cv-94)
The first loan involves the promissory note in the initial principal amount of
$250,000 that Defendant Boyd Brothers Inc. executed and delivered on May 10, 2007.
(Doc. 1, Exhibit 1). This loan was renewed on two occasions. (Doc. 1, Exhibits 2 & 3).
Along with the second renewal, the individual defendants executed guaranty agreements.
(Doc. 1, Exhibits 4, 5, 6, & 7). Defendant Boyd Brothers Inc. executed a third loan
renewal. (Doc. 1, Exhibit 10). Plaintiff claims that this loan is in default and that the
guaranties are not satisfied.
The individual defendants contend that summary judgment is inappropriate for
several reasons. First, they assert that Mr. Jade Stanford’s declaration is inadmissible.
(Doc. 82, p.3). Mr. Stanford is a Plaintiff’s vice president, and his declaration and review
of the loan documents is admissible. (See Doc. 65). What is not within Mr. Stanford’s
personal knowledge is covered by the business record’s exception. Fed. R. Evid. 803(6).
Next, Defendants also contend that the named defendant Cecelia R. Boyd is an
improper party. The loan documents refer to Cecilia R. Boyd. The named defendant
reflects a clear misspelling and can be corrected upon motion. Ms. Boyd, regardless of
the spelling of her first name, has appeared.
Defendants also contend that the Equal Credit Opportunity Act (“ECOA”) bars
recovery from the female individual defendants. (Doc. 82, p. 6-7). The ECOA makes it
unlawful for lenders to discriminate against applicants based on gender or marital status.
15 U.S.C. § 1691(a)(1). Defendants have cited an Alaska Supreme Court case to argue
that the ECOA makes unlawful guaranty agreements unenforceable. See Still v.
Cunningham, 94 P.3d 1104 (Alaska 2004). However, Defendants have not met their
burden in establishing a prima face case of credit discrimination. Mays v. Buckeye Rural
Elec. Coop., Inc., 277 F.3d 873, 876 (6th Cir. 2002); Mercado-Garcia v. Ponce Fed.
Bank, 979 F.2d 890, 893 (1st Cir. 1992); Nicholson v. Johanns, 2007 U.S. Dist. LEXIS
83909, *18-20 (S.D. Ala. 2007). Absent anything but mere allegations, Defendants are
not entitled to any burden-shifting analysis. Id.
The first affirmative defense, waiver and estoppel, is meritless. (Doc. 18, p. 1).
Defendants claim that Plaintiff made representations that they would make future
renewals of the promissory note. However, the terms of the final renewal (Doc. 1,
Exhibit 10) states that the “Note cannot be changed or modified orally.” Id at ¶14. The
terms could not be clearer. Any representations about future renewals are not part of this
agreement and cannot be considered. Further, the parole evidence rule precludes
consideration of oral agreements which contradict the terms of this valid contract. Solary
v. Webster, 35 Fla. 363, 373 (Fla. 1895); Federal Deposit Ins. Corp. v. Hemmerle, 592
So. 2d 1110, 1113-1114 (Fla. 4th DCA. 1991).
The second affirmative defense is also meritless. (Doc. 18, p. 2). The statute of
frauds requires certain contracts to be in writing. See, e.g., Fla. Stat. § 672.201; Id. at §
725.01. Defendants’ claims that the guaranty agreements were not notarized or dated is
of no moment. There is no such requirement under Florida law. The fact that the
guaranty agreements did not identify the amount of the debt is also not material. The
agreement states that the “Guarantor absolutely and unconditionally guarantees full and
punctual payment and satisfaction of the . . . indebtedness of the Borrower to Lender.”
(Doc. 1, Attach. 7).1 The language of this writing is sufficiently clear to establish the
duties of the parties. It satisfies the statute of frauds. “Every agreement which is
required to be in writing, under the statute of frauds, must be certain in itself, or capable
of being made so by a reference to something else whereby the terms can be ascertined
with reasonable certainty.” Swisher v. Conrad, 76 Fla. 644, 646 (Fla. 1919) (citation and
quotation omitted). Here, the agreement refers to the indebtedness of Boyd Brothers Inc.,
and the amount of indebtedness could be ascertained by reference to the underlying loan.
The third affirmative defense, commercial impracticability, is meritless. The
doctrine of commercial impracticability provides that “where, after a contract is made, a
party's performance is made impracticable without his fault by the occurrence of an event
the non-occurrence of which was a basic assumption on which the contract was made, his
duty to render that performance is discharged, unless the language or the circumstances
indicate the contrary.” Seitz v. Mark-O-Lite Sign Contractors, 210 N.J. Super. 646, 65,
510 A.2d 319, 322 (Law Div. 1986) (citing RESTAT. 2D OF CONTRACTS, § 261). Quite
simply, the BP oil spill, and knowledge by Plaintiff that Defendants would have difficulty
repaying the debt do not excuse nonperformance.
The fourth affirmative defense, no meeting of the minds, is without merit. The
agreement speaks for itself. “In an action based upon a contract, the admitted contract . .
. so often speaks so conclusively on the material facts as to leave no doubt that there are
no genuine issues of any material fact to be determined.” Rivaux v. Florida Power &
Each of the individual defendants executed identical, but separate guaranties. This guaranty is used as an example
of what all individual defendants agreed to. It is between Ms. Cecelia Boyd and Plaintiff.
Light Co., 78 So. 2d 714, 716 (Fla. 1955). Here, the original loan and subsequent
extension agreements are unambiguous and any terms which do not appear in the
agreements concerning other contingencies are not to be considered.
The fifth affirmative defense, lack of consideration, is without merit. There was
adequate consideration to support the original loan, the extensions, and the guaranty
agreements. The fact that Plaintiff may have known that Defendants lacked the resources
to pay does not negate that there was a mutuality of the bargained-for exchange.
The sixth affirmative defense, mutual departure, is without merit. Mutual
departure is not a recognized defense in Florida.
The seventh affirmative defense, duress and coercion, is also meritless. Even if
true, a threat to call a promissory note to induce the execution of the Amended Loan
Agreement is not actionable. The right to call a promissory note is governed by the terms
of that agreement. And, exercising that right is not a form of duress. See AM JUR 2D
Duress and Undue Influence § 6 (“A claim of duress cannot be based upon a party's
threat to take an action that is within that party's legal right to take.”).
The ninth affirmative defense fails for the same reason as all the purported
representations made by the bank, which were never written down. Those outside
agreements are not part of the contract and will not be considered because they violate
the parole evidence rule.
In sum, even in the light most favorable to Defendants, there is no room for
debate. The loan is in default, and the individual defendants have not fulfilled the valid
II. LOAN 2 (5:11-cv-95)2
The second loan involves the promissory note in the initial principal amount of
$420,000 that Defendant Boyd Brothers Inc. executed and delivered on May 27, 2005.
(Doc. 1, Exhibit 1). To secure this obligation, Defendant Boyd Brothers executed and
delivered a mortgage on property it then owned to Plaintiff which was recorded. (Doc. 1,
Exhibit 2). To further secure the obligation, Defendant Boyd Brothers Inc. executed and
delivered an assignment of rents on property it owned which was also recorded. (Doc. 1,
Defendant Boyd Brothers Inc. executed and delivered a renewal promissory note
in September 2010, in the principal amount of $393,648.96. (Doc. 1, Exhibit 6). The
individual defendants executed guaranty agreements of the loan. (Doc. 1, Exhibits 7, 8,
9, & 10). Plaintiff claims that the loan is in default and the guaranties are not satisfied.
Defendants’ arguments against summary judgment fail for the reasons set forth in
Section I, supra. While the loan documents and guaranty agreements are somewhat
different from the ones executed in Section I, the rationale is the same. Here, the
guaranties contain similar language stating that the “lender shall not be deemed to have
waived any rights . . . unless such waiver is in writing and signed by the lender.” (Doc. 1,
Exhibit 7). This language has the same meaning and effect as those agreements in
Defendants’ seventh affirmative defense is without moment. Defendants assert
that Plaintiff claims are barred because Plaintiff failed to “mitigate its damages by not
All references to documents in this section refer the docket entry for 5:11-cv-95.
foreclosing on the collateral.” (Doc. 14, p.3). The loan documents entitle Plaintiff to
pursue available remedies successively or concurrently. In addition, it is common
practice and well settled law that a lender may first pursue a judgment on a promissory
note, and then later file a separate action to foreclose the mortgage securing the note if
the judgment is not satisfied. Junction Bit & Tool Co. v. Village Apartments, Inc., 262
So.2d 659, 660 (Fla. 1972).
For these reasons, and in the light most favorable to Defendants, summary
judgment is appropriate for the second loan.
III. Loan 3 (5:11-cv-97)3
The third loan involves the promissory note in the initial principal amount of
$100,000 that Defendant Boyd Brothers Inc. executed and delivered on April 27, 1995.
(Doc. 1, Exhibit 1). This loan was renewed in 1996 (Doc. 1, Exhibit 2), and again in
1997 (Doc. 1, Exhibit 3). On November 26, 1997, Defendant Boyd Brothers Inc.
executed and delivered a promissory note in the initial principal amount of $150,000.
(Doc. 1, Exhibit 4). Also on November 26, 1997. Defendant Boyd Brothers Inc.
memorialized its obligations under the original $100,000 note, and the second $150,000
note by executing and delivering a promissory note in the initial principal amount of
$250,000. (Doc. 1, Exhibit 5). This $250,000 note was renewed seven additional times.
(See Doc. 1, Exhibits 6, 7, 8, 9, 10 , 11 & 12). In the “tenth renewal,” executed on July
All references to documents in this section refer the docket entry for 5:11-cv-97.
9, 2009, Defendant Boyd Brothers Inc. delivered a promissory note in the initial principal
amount of $1,000,000. (Doc. 1, Exhibit 12).
On July 9, 2009, the individual defendants executed and delivered commercial
guaranties for the loan. (Doc. 1, Exhibit 13). On September 17, 2010, Defendant Boyd
Brothers Inc. executed and delivered a renewal promissory note in the initial principal
amount of $1,000,000. (Doc. 1, Exhibit 16). Plaintiff alleges that the loan is in default
and the guaranties have not been satisfied.
Defendants have raised eight affirmative defenses which are all meritless for the
reasons stated in the previous two sections.
IV. Loan 4 (5:11-cv-98)4
The fourth loan involves a promissory note in the initial principal amount of
$3,400,000 that Defendant Boyd Brothers Inc. executed and delivered on June 13, 2002.
(Doc. 1, Exhibit 1). Also on June 13, 2002, the individual defendants executed and
delivered guaranty agreements for this loan. (Doc. 1, Exhibit 2). Defendant Boyd
Brothers Inc. also granted a security interest in certain printing equipment to secure the
loan. (Doc. 1, Exhibit 3). On September 17, 2010, Defendant Boyd Brothers executed
and delivered a renewal promissory note in the initial principal amount of $1,548,039.30.
(Doc. 1, Exhibit 8). Plaintiff alleges that this note is in default and that the guaranties
have not been satisfied.
All references to documents in this section refer the docket entry for 5:11-cv-98.
Defendants have raised ten affirmative defenses which are all meritless for the
reasons stated in previous sections.
V. Loan 5 (5:11-cv-339)
This fifth loan is not part of this consolidated action, and will not be considered
VI. Loan 6 (5:11-cv-96)5
The sixth loan involves a promissory note in the initial principal amount of
$734,000 that Defendant Boyd Brothers Inc. executed and delivered on September 17,
2010. (Doc. 1, Exhibit 1). Also on September 17, 2010, the individual defendants
executed a guarantee agreement. (Doc. 1, Exhibit 2). Plaintiff alleges that this note is in
default and that the guarantees have not been satisfied.
Defendants have raised eight affirmative defenses which are all meritless for the
reasons stated in previous sections. The guarantee agreement is somewhat different from
the others. However, it contains similar language which states that “no waiver of any of
its rights hereunder, and no modification or amendment of this Guarantee, shall be
deemed to be made by Lender unless the same shall be in writing, duly signed on behalf
of Lender.” (Doc. 1, Exhibit 2).
All references to documents in this section refer the docket entry for 5:11-cv-96.
IT IS ORDERED:
1. The Motion for Final Summary Judgment (Doc. 63) is GRANTED as to the
individual defendants-- JAMES A. BOYD, SR., NANCY G. BOYD, JAMES A.
BOYD, JR., and CECELIA R. BOYD.
2. The cases remain stayed as to Defendant Boyd Brothers, Inc., pending
resolution of its bankruptcy. This order does not apply to Defendant Boyd
3. Plaintiff’s Motion for Judgment on the Pleadings (Doc. 90) is DENIED as
4. Plaintiff shall submit the current balances of the outstanding indebtedness with
principal, accrued interest, and daily accrued interest rate. The clerk will then
enter judgments in favor of Plaintiff against the individual defendants in that
ORDERED on December 22, 2011.
/S/ Richard Smoak
UNITED STATES DISTRICT JUDGE