A recent Georgia case has held that when a debtor testifies that he did not execute a Guaranty of a loan, even in light of considerable evidence to the contrary, the case must go to trial and the bank is not entitled to Summary Judgment.
In Gause v. Fidelity Bank A15A0284 (Ga. App. July 8, 2015) Gause obtained a $1.1 Million loan from Fidelity’s predecessor in interest, Securities Exchange Bank, for the purchase of 25 lots in a subdivision. The same day, Gause signed an unconditional Guaranty of the Note on behalf of his company, Gause Construction Company, Inc.
Gause and Gause Construction Company, Inc. admittedly failed to pay the Note when due. During the discovery phase of the subsequent litigation, Gause produced an Affidavit stating that he was certain that he did not execute the Guaranty on behalf of Gause Construction Company, Inc. and the bank must have inserted a signature page from another document.
The Court of Appeals held that notwithstanding evidence to the contrary, including testimony of the closing attorney stating that Gause signed the guaranty, Gause’s Affidavit stating he did not execute the Guaranty is sufficient to create a question of fact for the jury to decide. Therefore, the Trial Court’s grant of Summary Judgment to Fidelity was erroneous and reversed.
This decision may mark a shift in the Court’s reasoning regarding self-serving Affidavits, especially since the closing attorney testified that the Guaranty was signed by the debtor.
