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An  unpublished  opinion  of  the  North  Carolina  Court  of  Appeals  does  not  constitute
controlling legal  authority. Citation is disfavored, but may be permitted in accordance
with the provisions of Rule  30(e)(3) of the  North Carolina Rules of Appellate Procedure.
NO. COA11-1115
NORTH CAROLINA COURT OF APPEALS
Filed:  1 May  2012
BANK OF THE CAROLINAS,
Plaintiff-Appellee,
v.                                                                                              Forsyth County
                                                                                                No.  10 CVS  3979
ROBERT W. BURKETT,
Defendant-Appellant.
Appeal  by  Defendant  from  order  entered  9  May  2011  by  Judge
L.  Todd  Burke  in  Superior  Court,  Forsyth  County.    Heard  in  the
Court of Appeals  23 January  2012.
Bell,  Davis  &  Pitt,  P.A.,  by  D.  Anderson  Carmen  and  Adam  T.
Duke, for Plaintiff-Appellee.
Sellers,  Hinshaw,  Ayers,  Dortch  &  Lyons,  P.A.,  by  Brett  E.
Dressler   and   Michelle   Price   Massingale,   for   Defendant-
Appellant.
McGEE, Judge.
Robert   W.   Burkett                                                                           (Defendant)   entered   into   a   guaranty
agreement  (the  guaranty)  with  Bank  of  the  Carolinas  (Plaintiff)
on                                                                                              5  October                                    2004.   The  guaranty  was  executed  in  conjunction
with  a  loan  agreement                                                                                                                              (the  loan)  between  Plaintiff  and  Town
Center   Hardware,   Inc.                                                                                                                             (the   Borrower)   in   the   amount   of




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$678,776.00.     Pursuant  to  the  guaranty,  Defendant  agreed  to
guarantee the loan for up to  $100,000.00.
There   was   an   outstanding   balance   on   the   loan   of
$407,510.60,  plus  accrued  interest  in  the  amount  of  $20,238.82,
when  the  Borrower  defaulted  on  the  loan.                                At  the  time  of
default,  the  Borrower  had  paid  over                                      $100,000.00   toward  the
principal  amount  of  the  loan.                                             Plaintiff,  pursuant  to  the
guaranty,   attempted   to   collect                                          $100,000.00   from   Defendant.
Defendant  argued,  however,  that  he  was  no  longer  liable  for  any
guaranty   payment   because   the   Borrower   had   paid   more   than
$100,000.00  on  the  loan.    Defendant  had  not  paid  any  monies  to
Plaintiff  for  the  purpose  of  paying  down  Defendant's  liability
under  the  guaranty.    Plaintiff  then  filed  this  action  on  26  May
2010,  seeking  the  $100,000.00  it  claimed  Defendant  owed  pursuant
to  the  guaranty,  plus  interest  and  costs.    Defendant  answered  on
31  August                                                                    2010,  claiming  that  he  had  fully  performed  under  the
terms  of  the  guaranty.    Plaintiff  moved  for  summary  judgment  on
15   April                                                                    2011.                                                          Summary  judgment  was  granted  in  favor  of
Plaintiff  by  order  filed  9  May  2011,  and  the  trial  court  ordered
Defendant  to  pay  the  $100,000.00  guaranty  amount,  plus  interest
and costs, including attorney's fees.    Defendant appeals.
Defendant  argues  that  the  trial  court  erred  in  granting
summary judgment in favor of Plaintiff.    We disagree.




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"Our  standard  of  review  of  an  appeal  from  summary  judgment
is  de  novo;  such  judgment  is  appropriate  only  when  the  record
shows  that  'there  is  no  genuine  issue  as  to  any  material  fact
and  that  any  party  is  entitled  to  a  judgment  as  a  matter  of
law.'"    In  re  Will  of  Jones,  362  N.C.  569,  573,  669  S.E.2d  572,
576  (2008)  (citation omitted).
Plaintiff's   claim,   which   is   based   upon   the   guaranty
agreement, is an action on a contract.
In  an  action  on  a  contract,  the  intention  of
the   parties   to   the   contract   must   be
determined    from    the    language    of    the
contract,  the  purpose  and  subject  matter  of
the   contract   and   the   situation   of   the
parties.    When  the  language  of  the  contract
is  clear  and  unambiguous,  construction  of
the  agreement  is  a  matter  of  law  for  the
court[,]  .  .  .   and   the   court   cannot   look
beyond   the   terms   of   the   contract   to
determine the intentions of the parties.
                                                                                                                               Piedmont  Bank  &  Trust  Co.  v.  Stevenson,                                                                                      79  N.C.  App.                               236,   240,
339  S.E.2d                                                                    49,                                        52   (1986)                                                                                                                             (citations  omitted).    Because  we  find
                                                                                                                                                                               that  the  relevant  language  is  unambiguous,  this  issue  was  a
                                                                                                                                                                               matter of law, and was properly decided upon summary judgment.
                                                                                                                                                                               The relevant language of the guaranty is as follows:
                                                                                                                               The   liability   of                                                                                                               [Defendant]   shall   be
                                                                               limited                                         to                                              a                                                                      principal   amount                                       of
$100,000.00  (if  unlimited  or  if  no  amount  is
stated,                                                                        [Defendant]  shall  be  liable  for  all
Indebtedness,  without  any  limitation  as  to
amount),  plus  accrued  interest  thereon  and
all  attorneys'  fees,  collection  costs  and
enforcement    expenses    referable    thereto.




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Indebtedness  may  be  created  and  continued  in
any  amount,  whether  or  not  in  excess  of  such
principal    amount,    without    affecting    or
impairing   the   liability   of                                               [Defendant].
[Plaintiff]  may  apply  any  sums  received  by
or  available  to                                                              [Plaintiff]  on  account  of
the  Indebtedness  from  Borrower  or  any  other
person                                                                         (except                                         [Defendant]),   from   their
properties,  out  of  any  collateral  security
or  from  any  other  source  to  payment  of  the
excess.    Such  application  of  receipts  shall
not  reduce,  affect  or  impair  the  liability
of                                                                             [Defendant].                                    If   the   liability   of
[Defendant]  is  limited  to  a  stated  amount
pursuant    to    this    paragraph  .  .  .,    any
payment   made   by                                                            [Defendant]   under   this
guaranty  shall  be  effective  to  reduce  or
discharge  such  liability  only  if  accompanied
by  a  written  transmittal  document,  received
by                                                                             [Plaintiff],   advising                         [Plaintiff]   that
such  payment  is  made  under  this  guaranty  for
such purpose.
Defendant  argues  that  his  liability  under  the  guaranty  was
limited  to  the  "first"                                                      $100,000.00  paid  on  the  loan,  no  matter
from  what  source  that  first                                                $100,000.00  came.     Defendant  does
not  argue  that  he  personally  paid  off  any  of  the  loan  secured  by
the  guaranty.     There  is  no  record  evidence  that  Defendant  has
paid  anything  pursuant  to  the  guaranty.    Defendant  attempts  to
introduce  evidence  concerning  understandings  and  oral  agreements
he  contends  existed  between  himself  and  Plaintiff.    Because  the
plain  language  of  the  guaranty  is  clear,  we  are  bound  thereby.
Stevenson,  79 N.C. App. at  240,  339 S.E.2d at  52.
The  guaranty  states  that  Defendant  is  liable  for  up  to
$100,000.00  of  the  original  $678,776.00  loan.    The  guaranty  also




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states  that  "sums  received"  by  Plaintiff  from  any  person  other
than  Defendant  "shall  not  reduce,  affect  or  impair  the  liability
of"  Defendant.    Finally,  the  guaranty  had  a  specific  provision
concerning   what   kinds   of   payments   could   reduce   Defendant's
liability before satisfaction of the loan amount:
If  the  liability  of                                                      [Defendant]  is  limited
to   a   stated   amount   pursuant   to   this
paragraph                                                                   .,   any   payment   made   by
                                                                            [Defendant]   under   this   guaranty   shall   be
                                                                            effective   to   reduce   or   discharge   such
                                                                            liability  only  if  accompanied  by  a  written
transmittal                                                                 document,                                            received                  by
[Plaintiff],  advising                                                                                                           [Plaintiff]  that  such
payment  is  made  under  this  guaranty  for  such
purpose.
Pursuant   to   the   guaranty,   Defendant   could   reduce   his
$100,000.00  liability  under  the  guaranty  if  he                        (1)  personally
paid  Plaintiff  for  that  purpose,  and  (2)  gave  Plaintiff  written
notification  that  Defendant's  payment  was  meant  to  be  applied
towards  his  $100,000.00  liability.    When  the  relevant  section  of
the  guaranty  is  read  as  a  whole,  there  is  no  ambiguity  in  its
language  concerning  how  and  when  Defendant's  liability  for  the
$100,000.00  could  be  satisfied.    The  guaranty  makes  clear  that
Defendant's  liability  was  not  diminished  or  extinguished  by
payments  toward  the  full  loan  amount  made  by  the  Borrower,  or
any  person  other  than  Defendant.     Defendant  failed  to  produce
any  evidence  that  he  complied  with  either  of  the  requirements
needed  to  reduce  or  extinguish  his  liability.                         Because  the




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amount  remaining  on  the  loan  exceeded                                     $100,000.00,  pursuant  to
the  guaranty,  Plaintiff  was  authorized  to  collect                        $100,000.00
from  Defendant.    The  trial  court  did  not  err  in  granting  summary
judgment in favor of Plaintiff.
Defendant  does  not  argue  on  appeal  that  the  trial  court
erred   in   ordering   Defendant   to   pay   interest   plus   costs,
including  attorney's  fees.     Therefore,  Defendant  has  abandoned
any such argument.    N.C.R. App. P.  28(b)(6).
Defendant  also  argues  that  summary  judgment  in  favor  of
Plaintiff  was  erroneous  because  Defendant  alleged  fraud  and
breach  of  the  duty  of  good  faith  and  fair  dealing  as  defenses  to
Plaintiff's action.    We disagree.
We  do  not  believe  any  extensive  analysis  of  these  issues  is
required.     The  guaranty  is  clear  in  its  terms,  and  Defendant
executed  the  guaranty.    Defendant  is  charged  with  knowledge  of
the express terms of the guaranty.
A  person  who  executes  a  written  instrument
is  ordinarily  charged  with  knowledge  of  its
contents,  and  may  not  base  an  action  for
fraud  on  ignorance  of  the  legal  effect  of
its  provisions.     While  these  rules  do  not
apply   to   situations   in   which   the   person
making  the  misrepresentations  stands  in  a
fiduciary  relationship  to  the  signing  party,
the  relationship  between  a  creditor  and  a
guarantor  is  not  such  a  relationship.     In
short,  we  hold  that  defendants'  reliance,  if
any,  on  alleged  misrepresentations  made  by
plaintiff's   agent   was   unreasonable   as   a
matter   of   law.                                                             We   further   hold   that




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plaintiff's  agent  had  no  duty  to  "disclose"
to   defendants   the   clear   terms   of   the
guaranty.
International  Harvester  Credit  Corp.  v.  Bowman,              69  N.C.  App.
217,  220,  316 S.E.2d  619,  621  (1984)  (citations omitted).
We  hold  that  the  trial  court  did  not  err  in  granting
summary judgment in favor of Plaintiff.
Affirmed.
Chief Judge MARTIN and Judge CALABRIA concur.
Report per Rule  30(e).

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