Opinion
NOT TO BE PUBLISHED
Appeal from a judgment of the Superior Court of Orange County No. 30-2008-00103737, Sheila Fell, Judge.
Law Offices of Hemar Rousso & Heald and Jeannine Del Monte Kowal for Plaintiff and Appellant.
No appearance for Defendant and Respondent.
OPINION
MOORE, J.
Plaintiff Citicapital Commercial Corporation (Citicapital) entered into five loan agreements with a corporation. As to two of the five agreements, defendant Yu S. Hoi executed a continuing guaranty. The corporation defaulted on the loan and filed bankruptcy, and Citicapital filed a lawsuit against the guarantor on all five agreements. The guarantor never appeared and his default was entered. After the default prove-up, the trial court entered judgment only on two of the five agreements that were accompanied by the continuing guaranty. Citicapital appeals, arguing it was entitled to judgment on all five agreements. We agree and reverse.
I
FACTS
In July 2004, plaintiff Citicapital entered into a security agreement (Agreement No. 1) with International Maywood Metals, Inc. (International) for the purchase of a Bobcat loader. Hoi executed a continuing guaranty, in which he agreed to pay all of International’s “present and future liabilities, obligations and indebtedness....” The guaranty included language stating that the guaranty “shall not be discharged or affected by any circumstances which constitute a legal or equitable discharge of a Guarantor or surety...” and that the guarantor “will not avail itself of any defense whatsoever which the Company may have against IRFS, other than full payment of the indebtedness....”
The guaranty was technically to Ingersoll-Rand Financial Services (IRFS), a division of Citicapital. They are interchangeable for purposes of this case.
International subsequently entered into four security agreements with Citicapital, each for the purchase of a Bobcat loader and various attachments: Agreement No. 2 (October 2004), Agreement No. 3 (September 2004), Agreement No. 4 (October 2005), and Agreement No. 5 (August 2005). At the time Agreement No. 3 was executed, Hoi also signed a second continuing guaranty, identical to the prior guaranty.
We follow the lead in Citicapital’s brief in numbering the agreements, despite the fact that the numbering is not chronological.
According to Citicapital, International stopped making payments on June 1, 2007. As of that time, International owed $3855.93 on Agreement No. 1, $12,249.10 on Agreement No. 2, $4184.04 on Agreement No. 3, $18,211.33 on Agreement No. 4, and $32,667.95 on Agreement No. 5.
In October 2007, International filed for bankruptcy protection. In March 2008, Citicapital filed the instant action against Hoi, seeking recovery pursuant to the guaranty agreements. Also pursuant to the guaranty agreement, Citicapital sought attorney fees.
On May 3, 2008, Hoi was served by substituted service. He failed to file an answer. Citicapital thereafter sought a default judgment of $76,832,19. At the default prove-up hearing, the court indicted it would enter default only on the two of the five agreements that included guaranties by Hoi, Agreement Nos. 1 and 3. These were relatively low amounts, constituting $3855.93 and $4184.04 plus interest. Citicapital thereafter submitted a written summary of the case arguing that the guaranties were continuing and intended to guaranty all of International’s present and future claims. The court declined to accept Citicapital’s argument and entered judgment only on Agreement Nos. 1 and 3, plus interest and attorney fees. Citicapital now appeals.
II
DISCUSSION
Hoi did not file a brief in this appeal. We therefore decide the matter on the opening brief, the record, and Citicapital’s oral argument. (Cal. Rules of Court, rule 8.220 (a)(2).)
Standard of Review
The sole question on appeal is whether Citicorp is entitled, as a matter of law, to judgment on the three remaining agreements that were not accompanied by a separate continuing guaranty. This requires us to interpret the continuing guaranty agreements. “When no extrinsic evidence is introduced, or when the competent extrinsic evidence is not in conflict, the appellate court independently construes the contract. [Citations.]” (Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc. (2003), 109 Cal.App.4th 944, 955.)
Continuing Guaranty
A surety or guarantor is “one who promises to answer for the debt, default, or miscarriage of another, or hypothecates property as security therefor.” (Civ. Code, § 2787.) Guaranty obligations must, generally, be in writing. (Civ. Code, § 2793.) “A guaranty relating to a future liability of the principal, under successive transactions, which either continue his liability or from time to time renew it after it has been satisfied, is called a continuing guaranty.” (Civ. Code, § 2814.) A continuing guaranty is subject to all provisions of law relating to surety obligations. (Wiener v. Van Winkle (1969), 273 Cal.App.2d 774, 786.)
Whether a contract is a continuing guaranty is a question of intent which must be gathered from the instrument itself or from the course of dealing between the parties. (Kierulff & Ravenscroft v. Koping (1928), 94 Cal.App 473, 478.) Because we have no extrinsic evidence regarding the parties’ course of dealing, we must rely on the document itself.
The document’s language (the two documents Hoi signed were identical) was clear. It was titled “Continuing Guaranty,” and stated that the guarantor, Hoi, “shall promptly and fully perform, pay and discharge all of [International’s] present and future liabilites, obligations and indebtedness to IRFS, whether direct or indirect, joint or several, absolute or contingent, secured or unsecured, matured or unmatured....”
Agreement Nos. 2, 4 and 5 were each entered into after Agreement Nos. 1 and 3, which were executed on the same dates as the continuing guaranty documents. Construing, as we must, the language of the continuing guaranties that Hoi signed, we conclude that the language “all of its present and future liabilities, obligations, and indebtedness” created valid continuing guaranties. Clearly, this was Citicapital’s intent, evidenced by titling the document “Continuing Guaranty” at the top of the page, and, obviously, we have no contrary evidence as to Hoi’s intent. The document also evidences Citicapital’s intent to shift liability to the guarantor in the broadest possible terms. We therefore find that the documents signed by Hoi in July and September 2004, were valid continuing guaranties. Thus, Hoi is personally liable for International’s subsequent debt to Citicapital.
On the surface, this result may seem overly harsh toward Hoi. We do not know what arguments or defenses he might have presented if he had actually appeared in the case, but that, unfortunately, is the point. Without Hoi’s participation in this proceeding, he has forfeited the right to make any of the factual arguments that might have resulted in a different outcome.
III
DISPOSITION
The judgment is reversed. The matter is remanded to the trial court with directions to enter a new judgment consistent with this opinion. Citicapital is entitled to its costs on appeal.
WE CONCUR: O’LEARY, ACTING P. J., ARONSON, J.