734-359-7018
Now Accepting New Clients!
Blog

Contracts 18: The personal guaranty assented to all the provisions of the Lease.

On August 19, 2013, defendant, LLC, entered a five-year lease agreement (the Lease) with Plaintiff for use as a restaurant and bar with liquor sales not to exceed 40% of the gross sales generated on the premises. The Lease prohibited LLC from using the premises as a nightclub, dance hall, disco, or for any other use inconsistent with the specified designated use. The Lease permitted the Plaintiff on prior written notice to conduct a complete audit of the records to assess its gross sales and percentage of gross sales from the sale of alcoholic beverages. Under the terms of the Lease, the Plaintiff could terminate it and take possession of the premises upon the occurrence of any event of default.

Personal Guaranty

In consideration of the Lease with LLC, G executed a personal guaranty, under which she unconditionally guaranteed the payment of all gross rent and charges under the lease, performance of all lease obligations, and payment of actual costs and attorney fees related to enforcement of the Lease.

On July 24, 2017, plaintiffs brought action against defendants alleging that LLC defaulted under the terms of the Lease by failing to pay the LLC filed a petition for protection under Chapter 11 of the United States Bankruptcy Code and filed notice in the circuit court that an automatic stay applied in this case.

Breach of Personal Guaranty

The plaintiff moved for partial summary disposition of its claims against G for breaches of her personal guaranties because of her failure to pay plaintiff the gross rent owed by LLC. The trial court summarized the plaintiff’s damages calculation in relation to the breaches of the guaranty based upon the account Lease Ledger. The trial court found that the personal guaranty made G liable for all gross rent without setoff.

Summary Disposition

Defendants argue that the trial court erred by entering summary disposition against G under her personal guaranty without permitting them to present evidence entitling them to setoffs and adjustments to the gross rent. They contend that genuine issues of material fact existed regarding the amount of rent owed by LLC and the validity of the personal guaranty.

Guaranty contracts are to be construed like other contracts. G’s personal guaranty lack ambiguity. Her personal guaranty induced the landlord to enter into the Lease. Under the terms of her guaranty, she assented to all of the provisions of the Lease.

Comprehensive Business Law Services

We have built a strong reputation in Michigan for providing high-quality legal representation and client service. Our attorneys can review contracts before you sign. Our dedicated lawyers can provide you with the legal guidance you need.

Contact Aldrich Legal Services

Speak to a Pro: (734) 404-3000

FAMILY LAW 88: The trial court found that the children did not have an established custodial environment with defendant because, before the separation, he did not have a large role in the children’s lives.

The trial court credited plaintiff’s testimony that, before the parties’ separation, defendant spent minimal time helping to care for the children, so its finding that the children would not have looked to defendant for guidance, discipline, the necessities of life, and parental comfort during that time was not against the great weight of the evidence.

REAL ESTATE 89: RM had not included any language in the deed providing that the property was a joint tenancy with full rights of survivorship, the property instead became a tenancy in common.

RM drafted the deed without seeking counsel and mistakenly believed that, if either she or FK died, the property would fully pass to the surviving tenant. FK’s will provided that if his wife predeceased him—which she did—the personal representative of his estate should sell any residual property that he owned and divide the cash proceeds equally among his surviving children.

FAMILY LAW 83: A trial court can terminate a parent’s rights and permit a stepparent to adopt a child.

A trial court has discretion to terminate a parent’s rights and permit a stepparent to adopt a child when the conditions of MCL 710.51(6) are met. MCL 710.51(6)(b) requires the petitioner to establish that the other parent had the ability to visit, contact, or communicate with the children, and substantially failed or neglected to do so for a period of two years.

PROBATE 53: The trust agreement included an Incontestability Provision.

A settlor’s intent is to be carried out as nearly as possible. Generally, in terrorem clauses are valid and enforceable. However, a provision in a trust that purports to penalize an interested person for contesting the trust or instituting another proceeding relating to the trust shall not be given effect if probable cause exists for instituting a proceeding contesting the trust or another proceeding relating to the trust.

FAMILY LAW 82: Court stated it would terminate the personal protection order (PPO) after the parties present documentation of the initiation of the divorce proceedings.

However, the trial court concluded that these matters should, in fact, be in the province and the jurisdiction of the Family Division and in that respect, having issued a personal protection order, the Court stated it would terminate the personal protection order after the parties present documentation of the initiation of the divorce proceedings.

What to Do When Homeowners Insurance Denies Your Claim

Since 1955, homeowners insurance has helped owners protect their property and belongings against damages and theft. According to the Insurance Information Institute, over 93% of homeowners in the US have homeowners insurance coverage, paying around...

Don't let a bad decision, unfair contract, or a messy divorce get in the way of a promising future!
Contact the experienced team at Aldrich Legal Services today to schedule your free initial
consultation
and secure reliable and trustworthy representation today!
Get the Help You Need From a Team You Can Truly Count On: (734) 404-3000
734-237-6482
734-366-4405