Opinion
NO. 2014-CA-001788-MR
04-29-2016
JOHN D. BROWNING APPELLANT v. ABC SUPPLY CO., INC. APPELLEE
BRIEF FOR APPELLANT: Bruce A. Niemi Louisville, Kentucky BRIEF FOR APPELLEE: W. Scott Stinnett Louisville, Kentucky
NOT TO BE PUBLISHED APPEAL FROM JEFFERSON CIRCUIT COURT
HONORABLE BARRY WILLETT, JUDGE
ACTION NO. 13-CI-000708 OPINION
AFFIRMING
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BEFORE: DIXON, JONES, AND J. LAMBERT, JUDGES. J. LAMBERT, JUDGE: John Browning appeals from the Jefferson Circuit Court's order granting summary judgment in favor of ABC Supply Co., Inc., in an action to recover the cost of materials sold to Crown Home Restoration, LLC (Crown). The circuit court held Browning signed as a guarantor on the account for Crown and that the guaranty was valid and enforceable. Because we agree with the circuit court that John Browning signed a credit application as a guarantor, we affirm.
Christopher Browning is the sole member and owner of Crown, and Crown has its principal place of business in Louisville, Kentucky. John Browning (hereinafter Browning), the appellant herein, is Christopher's half-brother, and resides in Georgetown, Indiana. Browning has never been a member of or had any ownership interest in Crown.
Christopher submitted an application for credit on behalf of Crown with ABC Supply, and the application contained a section labeled "Your Personal Guaranty." In this section, there was a line stating "Guarantors Sign Here," which contained lines for the guarantors' signatures along with lines for the guarantor to provide his or her written name and address. Browning admits to signing and filling out this initial application for credit as a guarantor for Christopher to obtain the line of credit necessary to get his company up and running. Browning testified at his deposition that Christopher provided him with the application and that he wanted to help his brother out with starting Crown.
After the initial application, ABC Supply presented Christopher with another document, which Christopher alleges he signed in the presence of Mike Walls, an employee of ABC Supply. ABC Supply labels this document the "Kentucky Guaranty" in its brief to this Court. After suit was initiated by ABC Supply to recover the debt it was owed, Christopher filed an affidavit, stating that he was presented this document by Mr. Walls, and that on that day, Browning was not present to sign any documents. Christopher averred that Mr. Walls then stated, "Well, I'm not looking," and Christopher then signed the document, thereby forging Browning's signature on the guarantor portion. At his deposition, Mr. Walls testified that he had no recollection of telling Christopher he would look the other way while Christopher forged the document.
The record reflects that the signature on the initial credit application and the signature on the Kentucky Guaranty do not match and do not appear to be signed by the same person.
After submission of the credit application, ABC Supply granted Crown a line of credit to purchase building materials in an amount in excess of $40,000.00. Crown defaulted, and ABC filed suit against Crown, Christopher, and Browning for collection of the debt. Browning filed an answer, asserting that the personal guaranty he signed was limited to $10,000.00. Sometime later, Browning also asserted a claim that portions of the Kentucky Guaranty were signed and submitted by Christopher and not by him. He argued that the forged signature on the Kentucky Guaranty rendered his other signature on the initial application invalid.
The parties filed motions for summary judgment, and after hearing oral arguments, the circuit court granted summary judgment in favor of ABC Supply. The court held that the personal guaranty signed by Browning was valid and enforceable, and it granted a judgment in favor of ABC Supply in the amount of $41,394.28, plus interest, reasonable attorney's fees, and litigation costs. This appeal now follows.
"The standard of review on appeal when a trial court grants a motion for summary judgment is 'whether the trial court correctly found that there were no genuine issues as to any material fact and that the moving party was entitled to judgment as a matter of law.'" Lewis v. B & R Corp., 56 S.W.3d 432, 436 (Ky. App. 2001), citing Scifres v. Kraft, 916 S.W.2d 779, 781 (Ky. App. 1996); Palmer v. Int'l Ass'n of Machinists & Aerospace Workers, 882 S.W.2d 117, 120 (Ky. 1994); CR 56.03. "Because summary judgment involves only legal questions and the existence of any disputed material issues of fact, an appellate court need not defer to the trial court's decision and will review the issue de novo." Lewis, 56 S.W.3d at 436, citing Scifres, 916 S.W.2d at 781; Estate of Wheeler v. Veal Realtors & Auctioneers, Inc., 997 S.W.2d 497, 498 (Ky. App. 1999); Morton v. Bank of the Bluegrass & Trust Co., 18 S.W.3d 353, 358 (Ky. App. 1999).
Browning argues on appeal that the circuit court ignored the fact that the signature on the Kentucky Guaranty was forged by Christopher and that this forgery renders the original guaranty invalid and unenforceable. Browning further argues that Mr. Walls' knowledge of Christopher forging the signature creates an issue of material fact, which precludes summary judgment.
ABC Supply contends that the signature on the Kentucky Guaranty was not required and that the Kentucky Guaranty was only previously necessary in order to strictly comply with Kentucky Revised Statutes (KRS) 371.065 prior to the Kentucky Supreme Court's decision in Wheeler & Clevenger Oil Co. v. Washburn, 127 S.W.3d 609 (Ky. 2004). ABC Supply argues that Wheeler negated the need for the Kentucky Guaranty, but that it sometimes still submitted one when opening a new account. According to ABC Supply, this is a completely separate document from the credit application, and thus it has no bearing on the credit application's validity, which Browning admitted to signing as a guarantor.
A review of the facts of this case indicates that Browning admittedly signed as a guarantor on the original credit application. That document was not required to state the maximum liability of the guarantor or the termination date of the guaranty, as the Kentucky Supreme Court held in Wheeler. Browning has not alleged that the guarantor portion of the credit application was invalid on its face, as was the issue in Wheeler. Thus, as we read Wheeler, and as ABC Supply argues in its brief to this Court, ABC Supply was not required to have Browning sign the Kentucky Guaranty, and thus any alleged forged signature on that document does not affect Browning's original signature on the credit application. Because Browning admits that he signed the credit application as a guarantor in order to help his brother obtain a line of credit for his business, there is no material issue of fact, and the circuit court properly granted summary judgment in favor of ABC Supply in the amount due on the debt.
Based on the foregoing, we affirm the Jefferson Circuit Court's order granting summary judgment in favor of ABC Supply Co., Inc.
ALL CONCUR. BRIEF FOR APPELLANT: Bruce A. Niemi
Louisville, Kentucky BRIEF FOR APPELLEE: W. Scott Stinnett
Louisville, Kentucky