United States Of America v. Meadors

753 F.2d 590 (7th Cir. 1985)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

MJD applied for a loan to pay off debts and to provide working capital. The loan was subject to a guaranty by the SBA. The SBA approved the request for a 56% guaranty of the $281,000 loan but required the principals Melton Meadors, Jay Judd, and Harold Ducote and Ducote's wife Marie to sign a guaranty. After considering the loan, the SBA chose to have Meadors, Judd, Ducote, and Ducote's wife sign the required guaranty. On April 2, 1977, Melton Meadors and D were married. At the April 19 closing, the three principals and their wives were all present. Although the SBA had provided places on its Form 148 for the signatures only of Meadors, Judd, Ducote, & Ducote's wife, and although no one from the SBA was present to request additional signatures, all six -- the three principals and their wives -- signed the guaranty form. Neither the SBA nor the Bank required D to sign any document as a prerequisite for disbursing loan proceeds. These facts are not disputed by either side. MJD defaulted. An action was instituted to collect the deficiency from the guarantors, including D. D raised several defenses, including lack of consideration and impairment of collateral. P filed a motion for summary judgment, which was granted. D appealed.