Futrelle, et al v. Wills, et al

U.S. District Court

Eastern District of Missouri (Southeastern)

CIVIL DOCKET FOR CASE #: 96-CV-153

Filed: 08/30/96

Demand: $6,000,000

WILLIAM ANDREW FUTRELLE – Plaintiff

BILLIE FUTRELLE, as father and mother respectively of

decedent William Andrew Futrelle, II – Plaintiff

BOB WILLS doing business as

The Mountain Park Baptist Academy - Defendant

4/30/98

NOTICE by Bob Wills of filing bankruptcy - CASE STAYED as to defendant Bob Wills.

[Entry date 05/01/98]

5/5/98

PRELIMINARY RESPONSE by plaintiff William Andrew Futrelle, plaintiff Billie Futrelle to defendant Wills' notice of bankruptcy. [Entry date 05/06/98]

6/4/98

ORDER by Honorable Catherine D. Perry IT IS HEREBY

ORDERED that the stay in bankruptcy of this matter is lifted. Defendant shall promptly file notice with this Court when the bankruptcy case has actually been dismissed....

[Entry date 06/09/98]

What was going on during the time of the Futrelle lawsuit? Bob Wills filed an appeal in the Mississippi Court of Appeals, based on a 1994 judgment entered against him; Bob Wills was the GUARANTOR on a [defaulted] loan for Redemption Ranch (doing business as Bethesda Home for Girls) in Mississippi. Redemption Ranch was the DEBTOR, and was dismissed from the case, but Bob Wills wasn’t dismissed. This is part of what the Mississippi Court relied on in its judgment concerning Bob Wills being the GUARANTOR and his obligation to pay a judgment that had been entered against him:

“the debtor [Redemption Ranch] may avoid his obligation under the note by obtaining a bankruptcy discharge, yet the guarantor's [Bob Wills’] obligation remains unaffected by this [bankruptcy] discharge.”

Some pertinent background info from the case:

03/11/97, IN THE COURT OF APPEALS OF THE STATE OF MISSISSIPPI, NO. 94-CA-00803 COA,

BOBBY RAY WILLS - APPELLANT

v.

BANK OF MISSISSIPPI - APPELLEE

This case is an appeal from a grant of summary judgment awarded to the plaintiff, Bank of Mississippi, in an action against Bobby Ray Wills. The suit, commenced in the Circuit Court of Forrest County, was on a contract of guaranty executed by Wills to facilitate a loan from the bank to Redemption Ranch, Inc. We affirm the trial court.

.....

There is little doubt that the obligations of a guarantor are distinct from that of the principal debtor and, in some instances, are more demanding. The facts of the case now under consideration offer one such example. The shorter statute of limitations in section 15-1-23 by which Redemption Ranch escaped liability was not available to Wills, whose obligation is measured by the longer general statute of limitations applicable to written contracts. See Miss. Code Ann. 15-1-49 (1972); First Nat'l Bank v. Drummond, 419 So. 2d 154, 160 (Miss. 1982). In another example, the debtor may avoid his obligation under the note by obtaining a bankruptcy discharge, yet the guarantor's obligation remains unaffected by this discharge. NCNB Tex. Nat'l Bank v. Johnson, 11 F.3d 1260, 1265 (5th Cir. 1994); Restatement (Third) of Suretyship and Guaranty 34 cmt. b (1996). (Emphasis added.)

...

The Facts and the Course of the Proceedings in the Trial Court

The bank, in 1983, made a loan of $448,000.00 to Redemption Ranch, secured by a real estate deed of trust. Wills had previously executed a continuing contract of guaranty in favor of the bank by which he personally guaranteed the obligations of Redemption Ranch. There is no dispute that the guaranty contract obligated Wills as a guarantor of the 1983 loan. (Emphases added.)

Redemption Ranch defaulted on the loan, and, as a first step in the collection process, the bank initiated foreclosure of its deed of trust. The bank was the successful bidder at the foreclosure sale with a bid of $300,000.00. The balance due on the loan immediately prior to foreclosure was $410,846.75.

More than one year after the foreclosure sale, the bank filed suit against Redemption Ranch and Wills, seeking a joint and several judgment against these parties in the amount of $110,846.75 together with interest accruing after the sale date. Redemption Ranch was dismissed from the suit under the time bar of section 15-1-23 of the Mississippi Code of 1972, which requires a suit against the debtor for a deficiency arising after foreclosure to be commenced within a year of the sale....

....

94-CA-00803-COA Bobby Ray Wills v. Bank of Mississippi; Appeal No. 3892613 from judgment dated July 14, 1994, Forrest County Circuit Court; DISPOSITION - Appellant's motion for additional time within which to file motion for rehearing denied. Order entered.