Question

6. Charles Fontaine completed a form for Gordon Contractors in which he signed that portion of the form labeled “Name of Guarantor.” His signature followed immediately after a paragraph beginning, “[I]n consideration of the extension of credit by Gordon Building Supply Inc. the undersigned customer hereby agrees that the terms and condition of all sales are as follows.” There was also a blank following this paragraph for “Customer Name,” and it was signed by a Robert Schlaefli, although it is unclear whether he signed it individually or as an agent. At the beginning of the application, the blank for “Name of Individual Applying” was filled in with both Fontaine’s and Schlaefli’s names, and the blank for “Name of Company or Business” bore the words “McIntyre Development, Inc.” Finally, the blank for “Names of People Authorized to Purchase” was filled in with Schlaefli’s name and that of a Glen Bush.

Upon default of the debtor (never clearly identified in the agreement), Gordon Contractors filed suit to collect from Fontaine as a guarantor. Fontaine moved for summary judgment because he was not identified on the contract as a guarantor. The trial cou4rt granted Gordon Contractors a summary judgment against Fontaine, and Fontaine appealed. Determine the parties’ relationships and who is liable to whom.

7. Gilbert signed a guaranty for the benefit of his son with Cobb Exchange Bank. The guaranty included all extensions and renewals of the son’s obligation. Subsequently, a renewal of the note added an additional $600 to the original obligation. On the son’s default, Cobb Bank brought suit on the guaranty. Who should win? Why?

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