Bruno v. Wells Fargo Bank, N.A.

850 N.E.2d 940, 2006 Ind. App. LEXIS 1361, 2006 WL 1984998
CourtIndiana Court of Appeals
DecidedJuly 18, 2006
Docket46A03-0508-CV-365
StatusPublished
Cited by23 cases

This text of 850 N.E.2d 940 (Bruno v. Wells Fargo Bank, N.A.) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bruno v. Wells Fargo Bank, N.A., 850 N.E.2d 940, 2006 Ind. App. LEXIS 1361, 2006 WL 1984998 (Ind. Ct. App. 2006).

Opinion

OPINION

RILEY, Judge.

STATEMENT OF THE CASE

Appellant-Defendant, James D. Bruno (Bruno), appeals the trial court's grant of partial summary judgment and subsequent full summary judgment in favor of Appel-lee-Plaintiff, Wells Fargo Bank, N.A. (Wells Fargo).

We affirm in part, reverse in part, and remand.

ISSUE

Bruno raises two issues on appeal, which we restate as the following six issues:

(1) Whether a genuine issue of material fact exists as to Bruno's revocation of his guarantee on a promissory note issued by Wells Fargo;
(2) Whether a genuine issue of material fact exists as to the formation of a fiduciary relationship between Bruno, Guarantor, and Wells Fargo, Lender;
(3) Whether Wells Fargo failed to mitigate its damages;
(4) Whether the trial court violated Bruno's due process rights by holding a hearing where Bruno's counsel was present by cellular phone, but not in person;
(5) Whether the trial court properly calculated the amount owed under the promissory note; and
(6) Whether there was sufficient evidence to support the trial court's award of attorney's fees, and whether those fees were reasonable under the circumstances.

FACTS AND PROCEDURAL HISTORY

In 2002, Patrick O'Brien (O'Brien) approached Bruno and asked him to invest in a wholesale salvage business, Columbo Wholesale & Salvage, Inc. (Columbo). Bruno accepted O'Brien's offer to invest, but the two agreed that Bruno would not be involved in any of the business's operations. On February 10, 20083, O'Brien, on behalf of Columbo, negotiated a $100,000 revolving line of credit with Wells Fargo, memorialized by a note, which was guaranteed by O'Brien and Bruno. Specifically, the Guaranty states, in pertinent part:

CONTINUING UNLIMITED GUARANTY. For good and valuable consideration, [Bruno] ("Guarantor") absolutely and unconditionally guarantees and promises to pay to Wells Fargo [] ("Lender") or its order, in legal tender of the United States of America, the indebtedness (as that term is defined below) of Columbo [] ("Borrower") to Lender on the terms and conditions set forth in this Guaranty. Under this Guaranty, the liability of Guarantor is unlimited and the obligations of Guarantor are continuing.
INDEBTEDNESS GUARANTEED. The Indebtedness guaranteed by this Guaranty includes any and all of [Co-lumbo's] indebtedness to [Wells Fargo) and is used in the most comprehensive sense and means and includes any and all of [Columbo's] liabilities, obligations, and debts to [Wells Fargol, now existing or hereinafter incurred or created, including, without limitation, all loans, advances, interest, costs, debts, overdraft indebtedness, credit car indebtedness, lease obligations, other obligations, and Habilities of [Columbo], or any of them, and any present or future judgments against [Columbo], or any of them; and whether any such Indebtedness is voluntarily or involuntarily incurred, due or not due, absolute or contingent, liqui *944 dated, or unliquidated, determined or undetermined; whether [Columbo] may be liable individually or jointly with others, or primarily or secondarily, or as guarantor or surety; whether recover on the Indebtedness may be or may become barred or unenforceable against [Columbo] for any reason whatsoever; and whether the Indebtedness arises from transactions which may be voidable on account of infancy, insanity, ultra vires, or otherwise.
DURATION OF GUARANTY. This Guaranty ... will continue in full force until all Indebtedness incurred or contracted before receipt by [Wells Fargo] of any notice of revocation shall have been fully and finally paid and satisfied[,] and all of Guarantor's other obligations under this Guaranty shall have' been performed in full. If Guarantor elects to revoke this Guaranty, Guarantor may only do so in writing. Guarantor's written notice of revocation must be mailed to [Wells Fargol, by certified mail, at [Wells Fargo's] address ...

(Appellant's App. p. 22).

In February 2008, O'Brien made draws on the line of credit totaling $80,000.00. By March 10, 2003, the principal balance had reached $55,000.00. Following additional withdrawals by O'Brien, the principal balance was $73,000.00 by July 2008. At some point, Bruno realized that O'Brien had arranged for automatic debits from the Line of Credit to be deposited into his own personal account. This arrangement, along with O'Brien's successive withdrawals from the account concerned Bruno; consequently, Bruno contacted Wells Fargo on several occasions and requested that Wells Fargo close the line of credit or at least stop extending credit to O'Brien. However, O'Brien was authorized to make the withdrawals, and the principal and interest payments on the note were up to date. Further, Wells Fargo explained that because O'Brien was a guarantor on the account, it could not close the line of credit or refuse O'Brien's withdrawals.

Then, in April 2004, with a principal balance of $73,000.00, Columbo went into default on the note for failing to make payments. On August 2, 2004, Wells Fargo filed a complaint on guaranty against Bruno. 1 On September 30, 2004, Bruno filed his answer, a counterclaim against Wells Fargo alleging breach of fiduciary duty and bad faith, and a third party complaint against O'Brien. On January 28, 2005, Wells Fargo filed a motion for partial summary judgment. On March 28, 2005, the trial court held a hearing on the motion; however, due to confusion concerning the time of the hearing, Bruno's counsel participated by cellular telephone. There is no transcript of the hearing available for this court's review. On April 12, 2005, the trial court granted Wells Fargo's motion for partial summary judgment, stating in its Order that "as a matter of law, [Bruno] is liable as guarantor on the note of [] O'Brien. Furthermore, as a matter of law, there was no fiduciary relationship between [Wells Fargo) and [Brunol. Thus, [Bruno's] counterclaim alleging breach of fiduciary relationship between the parties should be dismissed." (Appellant's App. p. 5).

On April 29, 2005, Wells Fargo filed its motion for full summary judgment, and a hearing was held on this motion on July 1, 2005. On July 5, 2005, the trial court entered its Findings and Judgment in favor of Wells Fargo in the amount of $95,250.61, covering the note's principal, *945 interest, late fees, expenses, attorney's fees, and court costs.

Bruno now appeals. Additional facts will be provided as necessary.

DISCUSSION AND DECISION

Bruno contends that the trial court improperly granted partial summary judgment and then complete summary judgment in favor of Wells Fargo. In support of his argument, Bruno asserts that several genuine issues of material fact exist, including a question as to his revocation of guaranty, as well as to the existence of a fiduciary relationship between he and Wells Fargo.

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Bluebook (online)
850 N.E.2d 940, 2006 Ind. App. LEXIS 1361, 2006 WL 1984998, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bruno-v-wells-fargo-bank-na-indctapp-2006.