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Language of personal guaranty on construction project ambiguous as to date guaranty is effective

Holding that the Guaranty was ambiguous, the court affirmed the trial court's rulings that Sable (a plaintiff in one of these consolidated appeals and a defendant in the other) was personally liable for the amount of the Promissory Note and sums due under the SA accruing on or after 7/30/07. However, it reversed the trial court's damage findings as to that sum and, on remand, directed the trial court to recalculate damages so as to include contractual interest accruing after 7/30/07. It also reversed the trial court's ruling that the Guaranty's unambiguous language provided that Sable was not personally liable for sums accruing under the SA before 7/30/07, and remanded for further proceedings on that issue. The case arose out of construction projects and contracts between Stonecrest (also a plaintiff in one of the cases and a defendant in the other) and nonparty-Stock. As part of its settlement with Stock, CTIC (the defendant in one of the cases and the plaintiff in the other) was assigned all of Stock's claims against Sable and Stonecrest. CTIC argued that the Guaranty's clear and unambiguous language provided that Sable assumed personal liability for all sums owed by Stonecrest to Stock under the SA, including all debts incurred before 7/30/07. The trial court disagreed, essentially finding that the Guaranty unambiguously provided that Sable only assumed personal liability for the amounts that came due on or after 7/30/07. However, the court held that the Guaranty was ambiguous and, thus, reversed and remanded. Sable did not dispute the Guaranty's validity or his personal liability thereunder. There was no question that he "clearly expressed" his intent to "assume some personal liability under the Guaranty." He did not dispute that he was personally liable for the amount of the Promissory Note and the sums due under the SA accruing on and after 7/30/07. Thus, the question before the court was whether Sable assumed personal liability for those debts incurred under the SA before 7/30/07. The parties each contended that "the Guaranty unambiguously evidences their advocated interpretation." The court found that, particularly in light of the special nature of a guaranty contract, each party presented a reasonable reading of the Guaranty. Thus, the court held that the document was ambiguous as to the scope of Sable's personal liability; "specifically, if that liability extends to all sums owed or only those that came due on or after" 7/30/07. The trial court's grant of summary disposition was inappropriate. Further, on remand, in determining the amount of damages payable by Sable for "sums payable by Stonecrest" after 7/30/07, "the trial court shall calculate and include the amount of interest incurred after that date for principal debts incurred prior to that date." Affirmed in part, and reversed and remanded in part.


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