Bank of China v. New Era Group, et al.
Published: Jul. 9, 1994 | Result Date: Jun. 3, 1994 | Filing Date: Jan. 1, 1900 |Case number: CV912647RMT – $1,924,240
Facts
Plaintiff bank entered into a credit-facility agreement with the corporate Defendant in the amount of $2,680,935 and dated December 15, 1986. Its shareholders, including the Defendants, guaranteed the corporate debt. The debt became due and was rescheduled; after workout arrangements did not result in repayment, a law suit was filed by the Plaintiff bank against the Defendant corporation and its guarantors. Later a settlement agreement was reached. Plaintiff bank agreed to release the guarantors from further liability for the corporate debt, if a partial payment was made by a date certain; January 10, 1991. The bank also received additional security from the guarantors as a result of this settlement. The guarantors did not make their partial repayment by the January 10, 1991 deadline; but a letter of agreement was then negotiated between the parties and prepared, though not signed, by the bank. The letter of agreement stated that a later partial payment deadline of July 10, 1991 would be provided for the guarantors if certain preconditions were met. The Court ruled on summary judgment that the parties did not intend the letter of agreement to be enforceable. The trial involved issues which included whether either the letter of agreement or subsequent acts or communications by the bank resulted in a waiver or estoppel situation with respect to the bank's ability to enforce the January 10, 1991 payment deadline; which original deadline would have resulted in the liability of the guarantors for the full amount of the corporate debt or, instead, whether that deadline had been waived or extended; in which case the guarantors urged that they should not be liable for the remaining corporate debt, as the guarantors paid the principal amount of the discounted sum plus fees, but without interest, by July 10, 1991.
Settlement Discussions
Plaintiff contends they demanded $500,000 plus one-half of the fees and Defendants made no offers.
Damages
$1,924,238.
Other Information
Motion for legal fees is pending.
Deliberation
4.5 hours
Poll
6-0
Length
11 days
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