AERL, L.C., v. Sather, et al.,

Filing 25

ORDER Pursuant to Rule 56(f) on Opportunity to Supplement. By Chief Judge Marcia S. Krieger on 1/27/2014. (klyon, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Honorable Marcia S. Krieger
Civil Action No. 12-cv-01158-MSK-KMT
AERL, L.C.,
Plaintiff,
v.
DONALD S. SATHER;
BETSY R. SATHER; and
CHARLES W. COLE, JR.,
Defendants.
ORDER PURSUANT TO RULE 56(f) ON
OPPORTUNITY TO SUPPLEMENT
THIS MATTER comes before the Court on the Plaintiff AERL, L.C.,’s Motion for
Summary Judgment (#21). The Defendants have not responded to the motion.
Having reviewed the motion and evidence submitted, the Court accepts the following
facts as true. In June 2003, American Equity Investment Life Insurance Company (American)1
executed a promissory note in favor of Summit Northstar Partners (Summit) in consideration for
a loan in the principal amount of $5,800,000. The note was secured by real property and repaid
over a ten year period. In connection with the loan, the Defendants executed a personal guaranty
in favor of American, in which they “individually, jointly and severally, irrevocably and
unconditionally” guaranteed the repayment when due of the full amount owed on the note. In
2011, Summit defaulted on its obligations to American.
Later, the Plaintiff foreclosed on the property securing the note. At the time of
foreclosure, the total indebtedness remaining on the note was $5,429,330.72. In December 2012,
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The Plaintiff is a wholly owned subsidiary of American.
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the Plaintiff purchased the property at auction for $4,000,000, thus leaving a deficiency on the
sale in the amount of $1,429,330.72.
The Plaintiff brings one claim against the three individual Defendants for breach of the
personal guaranty. However, on the evidence submitted, the Plaintiff cannot recover on its
claim. Specifically, there is no proof that the Plaintiff has the right to bring this action or to
enforce the personal guarantee. The parties to the guaranty contract were American and the
Defendants. Plaintiff’s counsel asserts in the motion that American assigned its rights under the
guarantee to the Plaintiff. But there has been no evidence submitted to support that assertion.
Additionally, there is no evidence that a demand for payment was made on the individual
Defendants in accordance with Section 1.03 of the guaranty. A demand for payment is a
precondition to recovery under the contract.
Accordingly, on the current record, judgment in favor of the Defendants is appropriate.
Pursuant to Fed. R. Civ. P. 56(f), this order serves as notice to the Plaintiff that the Court intends
to enter judgment in favor of the Defendants. The Plaintiff is granted 14 days leave in which it
may supplement its Motion for Summary Judgment. Failure to do so will result in entry of
judgment.
Dated this 27th day of January, 2014.
BY THE COURT:

Marcia S. Krieger
Chief United States District Judge

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