When Is a Guaranty Limited and When Is It Unconditional?
Guaranties generally come in two flavors: limited and unconditional. At the outset of a loan, one of the topics for negotiation is the guaranty. First, will there be a guaranty? Second, if there is a guaranty, will it be unconditional and unlimited or will it be limited in some way? A recent case reminds us that even if a guaranty does not have a specific dollar amount as a limiting factor, it may not necessarily be interpreted as unlimited and unconditional.
By Good Faith and Fair Dealing Is Not an Independent Tort Claim
In a lawsuit by former wide receiver David Givens against the Tennessee Titans, Givens alleged that the team was aware of a defect in his left knee and did not tell him about the problem. As a result, Givens alleged, he continued to play football until he was injured in a game in November 2006. Givens never played professional football again. Among other claims against the Titans, Givens asserted a cause of action for “the legal wrong, whether styled in quasi contract or tort, of performing its contractual obligations in bad faith.” Givens further alleged that this claim was a tort claim that did not require an interpretation of the collective bargaining agreement in place between the Titans and the NFL Players Association.
Timing is Everything
Prospective home buyers entered into a contract with a construction company for purchase of a home and construction of garage (to take place after closing). The buyers were to pay an additional $10,200 for the garage. A letter was subsequently prepared by the construction company specifying a time for the buyers to tender payment for the garage (30 days after closing). The buyers signed the letter but only after making a handwritten change to the timeframe to state the time for payment was 90 days after closing.
The Rule of Nullification - Exceptions for Unlicensed Brokers
In a recent decision, the Tennessee Court of Appeals addressed the rule of nullification in the context of unlicensed brokers’ commission contracts. The Court held that a contract was not necessarily unenforceable as contrary to public policy merely because the broker was unlicensed. See Christenberry Trucking & Farm, Inc. v. F & M Marketing Services, Inc., 2010 WL 1254374 (Tenn. Ct. App. 2010).
