Branch Banking & Trust Company v. Jerry C. Wardlaw Construction, Inc. et al

Filing 32

ORDER granting 23 Motion for Summary Judgment. The parties are directed to file briefs within 30 days from the date of this Order. Signed by Judge William T. Moore, Jr on 9/25/15. (bcw)

IN THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF GEORGIA
SAVANNAH DIVISION

U.
SEP 25 1015

BRANCH BANKING & TRUST COMPANY,
Plaintiff,

U.

L.L

CASE NO. CV414-042

V.

JERRY C. WARDLAW CONSTRUCTION,
INC.; JACK WARDLAW, III; AND
JERRY C. WARDLAW;
Defendants.

ORDER

Before the Court is the Plaintiff's Motion for Summary
Judgment (Doc. 23), to which Defendants' have filed a response
(Doc. 28). For the following reasons, Plaintiff's Motion is
GRANTED.

However, the Court reserves ruling on the issue of

damages. Both parties are hereby

ORDERED

to file a single

supplemental brief regarding the appropriate damages to be
applied at this time, including fees and other costs. Both
parties are

DIRECTED

to file their briefs within thirty days

from the date of this order.
BACKGROUND

This case arises out of a series of notes, note extensions,
and guarantees entered into between Jerry C. Wardlaw
Construction, Inc. ("Company"), Jack Wardlaw, III, and Jerry C.

Lr

Wardlaw (collectively "Defendants"); and Branch Banking & Trust
Company ("BB&T") . There are five notes at issue:
(1) Note-137 was executed by the Company on September
20, 2005 for $ 1,035,000. (Doc. 1 ¶ 9; Doc. 23,
Attach. 4 at 22-25.) The Company subsequently
executed a series of note modification agreements
that extended the maturity date of the note to
October 10, 2011. (Doc. 1 ¶ 10; Doc. 23, Attach.
4 at 27-46.) On September 20, 2005, Jack Wardlaw
and Jerry Wardlaw executed personal guarantees
unconditionally guaranteeing the payment of all
notes between the Company and BB&T.' (Doc. 1 ¶ 1112; Doc. 23, Attach. 4 at 48-53.)
(2) Note-144 was executed by the Company on April 13,
2006 for $ 1,533,000. (Doc. 1 ¶ 20; Doc. 23,
Attach. 4 at 55-58.) The Company subsequently
executed a series of note modification agreements
that extended the maturity date of the note.
(Doc. 1 ¶ 21; Doc. 23 1 Attach. 4 at 60-87.) On
April 13, 2006, Jack Wardlaw and Jerry Wardlaw
executed personal
guarantees
unconditionally
guaranteeing the payment of all notes between the
(Doc. 1 ¶ 22-23; Doc. 23,
Company and BE&T.
Attach. 4 at 89-94.)
(3) Note-180 was executed by the Company on March 26,
2007 for $ 1,361,600. (Doc. 1 ¶ 31; Doc. 23,
Attach. 4 at 96-99.) The Company subsequently
executed a series of note modification agreements
that extended the maturity date of the note.
(Doc. 1 ¶ 32; Doc. 23, Attach. 4 at 101-17.) On
March 26, 2007, Jack Wardlaw and Jerry Wardlaw
executed personal
guarantees
unconditionally
guaranteeing the payment of all notes between the
Company and BB&T.
(Doc.
1 ¶ 33-34; Doc. 23,
Attach. 4 at 119-24.)
(4) Note-231 was executed by the Company on June 2,
(Doc.
2009 for $ 212,400.
1 ¶ 42; Doc. 23,
After each note at issue in this case was executed, Jack and
Jerry Wardlaw executed personal guarantees that guaranteed each
note currently in existence between the Company and BB&T and any
notes that the Company would enter into in the future.
2

Attach. 4 at 126-29.) The Company subsequently
executed two note modification agreements that
extended the maturity date of the note. (Doc. 1 ¶
43; Doc. 23, Attach. 4 at 131-138.) On June 2,
2009, Jack Wardlaw and Jerry Wardlaw executed
personal guarantees unconditionally guaranteeing
the payment of all notes between the Company and
BB&T. (Doc. 1 ¶ 44-45; Doc. 23, Attach. 4 at 14045.)
(5) Note-233 was executed by the Company on March 19,
2010 for $204,000. (Doc. 1 ¶ 53; Doc. 23, Attach.
4 at 147-50.) At the same time, Jack Wardlaw
executed a personal guarantee unconditionally
guaranteeing the payment of all notes between the
Company and BB&T. (Doc. 1 ¶ 54; Doc. 23, Attach.
4 at 152-54.) On July 5, 2001 Jack Wardlaw and
Jerry Wardlaw executed personal guarantees
unconditionally guaranteeing payment of the notes
between the Company and BB&T. (Doc. 1 ¶ 55-56;
Doc. 23, Attach. 4 at 156-69.)
Defendants failed to pay the indebtedness under all 5 notes,
which subsequently went into default. (Doc. 23, Attach. 1 at 4BB&T

5, Doc. 28 at 2.) As a result,

filed suit in this Court

seeking recovery under the notes. (Doc. 1.)
On December 12, 2015 Plaintiff filed a Motion for Summary
Judgment (Doc. 23) stating that the Defendants had no valid
defenses to Plaintiff's claim (Doc. 23, Attach. 1 at 9), that
Plaintiff had properly stated a claim upon which relief could be
granted (id. at 8), and that there are no material disputes of
fact (id.) . Defendants filed a response (Doc. 28) conceding that
Plaintiff loaned money to the Company and that the Company was
unable to pay the amount sought in the lawsuit. (Id. at 2.)
However, Defendants challenged the evidentiary basis for
3

Plaintiff's motion, alleging that it relied on unauthenticated
documents that could not be considered for purposes of
adjudicating the motion. (Id. at 1.)
ANALYSIS

I.

MOTION FOR SUMMARY JUDGMENT
Summary judgment shall be rendered "if the pleadings,

depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that the moving party
is entitled to a judgment as a matter of law." Fed. R. Civ. P.
56(c). The "purpose of summary judgment is to 'pierce the
pleadings and to assess the proof in order to see whether there
is a genuine need for trial.' " Matsushita Elec. Indus. Co. v.
Zenith Radio Corp., 475 U.S. 574, 587 (quoting Fed. R. Civ. P.
56 advisory committee notes) . Summary judgment is appropriate
when the nonmovant "fails to make a showing sufficient to
establish the existence of an element essential to that party's
case, and on which that party will bear the burden of proof at
trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) . The
substantive law governing the action determines whether an
element is essential. DeLong Equip. Co. v. Wash. Mills Abrasive
Co., 887 F.2d 1499, 1505 (11th Cir. 1989).

4

As the Supreme Court explained:
[A] party seeking summary judgment always bears the
initial responsibility of informing the district
court of the basis for its motion, and identifying
those portions of the pleadings, depositions,
answers to interrogatories, and admissions on file,
together with the affidavits, if any, which it
believes demonstrate the absence of a genuine issue
of material fact.
Celotex,

477

U.S. at 323. The burden then shifts to the

nonmovant to establish, by going beyond the pleadings, that
there is a genuine issue as to facts material to the nonmovant's
case. Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir.
1991)
The Court must review the evidence and all reasonable
factual inferences arising from it in the light most favorable
to the nonmovant. Matsushita, 475 U.S. at 587-88. However, the
nonmoving party "must do more than simply show that there is
some metaphysical doubt as to the material facts." Id. at 586. A
mere "scintilla" of evidence, or simply conclusory allegations,
will not suffice. See, e.g., Tidwell v. Carter Prods., 135 F.3d
1422, 1425 (11th Cir. 1998) . Nevertheless, where a reasonable
fact finder may "draw more than one inference from the facts,
and that inference creates a genuine issue of material fact,
then the Court should refuse to grant summary judgment."
Barfield v.Brierton, 883 F.2d 923, 933-34 (11th Cir. 1989).

5

There is no dispute that the notes, note extensions, and
guarantees are governed under the laws of Georgia. (e. g. Doc.
23, Attach. 4 at 24.) In Georgia, "[i]t is well established that
a plaintiff seeking to enforce a promissory note establishes a
prima facie case by producing the note and showing that it was
executed." Stewart v. Johnson, 269 Ga. App. 698, 699, 605 S.E.2d
111, 113 (2004); (citing O.C.G.A. § 11-3-308(a); Vandegriff v.
Hamilton, 238 Ga. App. 603, 603, 519 S.E.2d 702, 703 (1999)).
Once the note has been produced and shown to be executed, "the
plaintiff is entitled to judgment as a matter of law unless the
defendant can establish a defense." Stewart, 269 Ga. App. at
699; (citing O.C.G.A. § 11-3-308(b); McLemore v. Sw. Ga. Farm
Credit, 230 Ga. App. 85, 87, 495 S.E.2d 335, 337 (1998);
CommonwealthLand Title Ins. Co. v. Miller, 195 Ga. App. 830,
832, 395 S.E.2d 243, 245 (1990); Sadler v. Trust Co. Bank of S.
Ga., 178 Ga. App. 871, 873, 344 S.E.2d 694, 695 (1986)).
This case presents no genuine issues of material fact.
Defendants have admitted that Plaintiff loaned money to the
Company, and Defendants have admitted that the Company was
unable to pay the funds sought in this lawsuit. (Doc. 28 at 2.)
Defendants have likewise admitted that Jerry Wardlaw and Jack
Wardlaw signed the guarantee agreements at issue in this case.
(Id.; see infra note 5) This is sufficient to support summary
judgment against the Defendants unless they present a valid

defense. Defendants' sole argument opposing the motion for
summary judgment is that the promissory notes, note
modifications, and guarantees accompanying Plaintiff's complaint
and Motion for Summary Judgment are unauthenticated documents
that cannot be considered at this stage in the litigation. 2
(Doc. 28 at 1.) For the reasons below, this Court finds this
defense unavailing.
Defendants first claim that the notes, note extensions, and
guarantees have not been properly introduced into evidence
before this Court. Generally,

"[t]o be admissible in support of

or in opposition to a motion for summary judgment, a document
must be authenticated by and attached to an affidavit that meets
the requirements of Rule 56(e) and the affiant must be a person
through whom the exhibits could be admitted into evidence."

2

Defendants presented a series of additional affirmative
defenses in their answer. (Doc. 10.) However, Defendants failed
to include these defenses in their response (Doc. 28) to
Plaintiff's motion (Doc. 23) . As a result, Defendants' have
waived these defenses. See Hamilton v. Southland Christian Sch.,
Inc., 680 F.3d 1316, 1319 (11th Cir. 2012) ("A passing reference
to an issue in a brief is not enough, and the failure to make
arguments and cite authorities in support of an issue waives
it."); see also Singh v. U.S. Att'y Gen., 561 F.3d 1275, 1278
(11th Cir. 2009) (per curiam) ("[S]imply stating that an issue
exists, without further argument or discussion, constitutes
abandonment of that issue and precludes our considering the
issue on appeal.")
Fed. R. Civ. Pro 56(e) was modified in 2010 and no longer
includes requirements for submitting affidavits with sworn
copies. Specifically, the Rule 56 Advisory Notes from the 2010
amendments concluded that "[t]he requirement that a sworn or
certified copy of a paper referred to in an affidavit or
7

Saunders v. Emory Healthcare, Inc., 360 Fed. App'x. 110, 113
(11th Cir. 2010) (citing bA Charles Alan Wright, Arthur R
Miller & Mary Kay Kane, Federal Practice and Procedure § 2772
(3d ed. 1998)) . The correct practice is to "attach [a] document
as an exhibit to an affidavit on summary judgment, and to have
that witness attest to the exhibit being a true and correct copy
of the original." U.S.Aviation Underwriters, Inc. v. Yellow
Freight Sys., Inc., 296 F. Supp. 2d 1322, 1334 n.12 (S.D. Ala.
2003) . That is exactly what happened here. Plaintiff attached
the notes, note modification agreements, guaranty agreements,
pay histories, business loan note inquiries and BB&T non-accrual
note calculators to the affidavit of Kenneth Wendel, and
submitted that affidavit as part of its Summary Judgment Motion.
(Doc. 23, Attach. 4.) Mr. Wendel's affidavit swears that the
copies attached "are true and correct copies, and were prepared
at the time of the act, transaction, occurrence or event, or
within a reasonable time thereafter." (Id. ¶ 2.) This affidavit
satisfies the requirements for producing documentation to be
considered at summary judgment.

declaration be attached to the affidavit or declaration is
omitted as unnecessary given the requirement in subdivision
(c) (1) (A) that a statement or dispute of fact be supported by
materials in the record." Fed. R. Civ. P. 56 advisory committee
notes.

ro

L!J

The Defendants also argue that the documents cannot be
introduced by Mr. Wendel because he did not sign the notes.
(Doc. 28 at 5.) This argument is, likewise, unavailing. There is
no requirement that the individual propounding a business record
also be the individual who signed it. According Fed. R. Evid.
901(a), documents must be properly authenticated as a condition
precedent to their admissibility by "evidence sufficient to
support a finding that the item is what the proponent claims." A
document may be authenticated by

"[a]ppearance, contents,

substance, internal patterns, or other distinctive
characteristics of the item, taken together with all the
circumstances." Id. at (b) (4) . "The court's task is to determine
whether there is competent evidence from which a reasonable mind
could conclude that the proposed item has been authenticated."
Williams v. Great-West Healthcare, 2007 WL 4564176 (N.D. Ga.
2007) (citing United States v. Caldwell, 776 F.2d 989, 1001 n.16
(11th Cir. 1985)).
There is little doubt in this Court's mind that the
documents at issue are "what the proponent claims," particularly
as Mr. Wendel's affidavit satisfies the requirements for the
submission of records of a regularly conducted business activity
pursuant to Fed. R. Evid. 803(6). The documents have been
offered through an officer of BB&T familiar with the bank's
making and maintenance of the records, and who testified that

the documents were made at or near the time of the event, were
made in the course of regularly conducted business, and were
properly kept in the course of BB&T's business. (Doc. 23,
Attach. 4 ¶ 1)
Finally, Defendants' argument that Plaintiff has not
produced the original copies of the notes, note extensions, and
guarantees is also insufficient to deny summary judgment.
Excluding Fed. R. Evid. 1002, there is "no general rule that
proof of a fact will be excluded unless its proponent furnishes
the best evidence in his power." Allstate Ins. Co. v. Swann, 27
F.3d 1539, 1543 (11th Cir. 1994) (citing 5 J. Weinstein & N.
Berger, Weinstein's Evidence ¶ 1002[01] (1993). Even when Rule
1002 is applied, Rule 1003 notes that

"[a] duplicate is

admissible to the same extent as the original unless a genuine
question is raised about the original's authenticity or the
circumstances make it unfair to admit the duplicate." Fed. R.
Evid. 1003. Likewise, there is no error in admitting photostatic
copies when there is no suggestion that the copies are
incorrect. Myrick v. United States, 332 F.2d 279, 282 (5th Cir.
1963) . The Defendants have raised no question here as to whether
the copies of the documents Plaintiff produced are authentic.

In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir.
1981) (en banc) the Eleventh Circuit adopted as binding
precedent all decisions of the former Fifth Circuit handed down
prior to October 1, 1981.
10

Not once in Defendants' response (Doc. 28) do they actually
state that there is a question as to the contents of the
documents or that the Defendants believe the documents to be
inaccurate. 5 As a result, this Court finds that the duplicates
submitted with Mr. Wendel's affidavit and attached to
Plaintiff's Motion for Summary Judgment are sufficient to
survive Defendants' challenge.
Defendants have not provided any evidence or argument which
justifies denying Plaintiff's motion for summary judgement.
Defendants have admitted that Plaintiff loaned money to the
Company and that the Company was unable to pay the funds sought
in this lawsuit. (Doc. 28 at 2.) Defendants have likewise
admitted that Jack and Jerry Wardlaw signed the guarantee
agreements at issue in this case. (Id.) With the exception of
the arguments regarding the authenticity of certain evidence,
disposed of above, Defendants have presented no defenses to the
Plaintiff's recovery on the notes. As a result, this Court sees
no colorable reason to deny Plaintiff's Motion for Summary
Judgment.

In fact, in Defendant Jerry C Wardlaw Construction, Inc.'s
Response to Plaintiff's First Request for Admissions, attached
as an exhibit to Plaintiff's Motion for Summary Judgment, the
Company admitted that true and correct copies of the notes were
attached to the complaint. (Doc 23, Attach. 5 at 77-83.) Jack
and Jerry Wardlaw likewise both admitted to the signatures on
the guarantees. (Doc. 23, Attach. 5 at 91-101; (Doc. 23, Attach.
5 at 108-119.)
11

II. DAMAGES
Plaintiff has presented evidence regarding the appropriate
damages to be applied in this case. However, this Court notes
that the damages calculation will depend on the length of time
during which the indebtedness under the loan has been pending.
As a result, this Court directs the parties to file a single
supplemental brief detailing the exact amount due under the
notes, including attorneys fees.
CONCLUSION

For the foregoing reasons, Plaintiff's Motion for Summary
Judgment is GRANTED.

However, the Court reserves ruling on the

issue of damages. Both parties are hereby

ORDERED

to file a

single supplemental brief regarding the appropriate damages to
be applied at this time, including fees and other costs. Both
parties are

DIRECTED

to file their briefs within thirty days

from the date of this order.

SO ORDERED this 21—day of September, 2015.

WILLIAM T. MOORE, J
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF GEORGIA

12