| ICSC Legal Database - Cases | Monday, February 22, 1999 05:01 PM |
| Citation: |
| Avec Corp. v. Schmidt, 207 Ga.App. 374, 427 S.E.2d 850 (1993). |
| Issue: |
| Whether a guarantor of a commercial lease is liable where the guaranty was not executed on the same day as |
| the lease and did not otherwise reflect the parties intention to create a guaranty on the lease? |
| Facts: |
| Plaintiff, a commercial landlord, brought suit against tenant and guarantors, the Schmidts, to collect overdue |
| rent. The guaranty was signed by the Schmidt before the lease was executed and referred to a provision of the |
| lease that did not deal with the event of default. The trial court directed verdict in favor of guarantors. The landlord |
| Holding: |
| Affirmed. The appellate court held that a guaranty must be strictly interpreted in the interest of the guarantor and |
| the guarantor's liability should not be extended beyond the terms of the contract. Because the guaranty did not |
| clearly reflect the Schmidts intent to guaranty the lease, and because the guaranty could not be deemed to |
| refer to a lease where documents were not executed on the same day, the court refused to extend liability by |
| Classification 1: |
| Landlord and Tenant |
| 00140 - Legal Update - Winter 1993 |
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