Title: Toland v. Key Bank of Wyoming

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Toland v. Key Bank of Wyoming1993 WY 22847 P.2d 549Case Number: 92-34Decided: 02/19/1993Supreme Court of Wyoming

 

Joe H. TOLAND and Mary 
Lynn Toland,

Appellants (Defendants 
and Third Party Plaintiffs),

v.

KEY BANK OF WYOMING, 
formerly First Wyoming Bank Sheridan Main, Trustee of the Henry G. Oswald and 
Margaret Oswald Trust created for the benefit of Henry G. Oswald and Margaret 
Oswald and their descendants under the Trust Agreement dated 
March 
31, 1987,

Appellees (Plaintiffs and 
Counter Defendants),

and

Henry G. Oswald and 
Margaret Oswald, husband and wife,

Appellees (Third Party 
Defendants).

 
 

Appeal from District 
Court, Sheridan 
County, Dan R. Price, II, 
J.

Timothy S. 
Tarver, Sheridan, for 
Tolands.

Kim D. Cannon of 
Burgess, Davis, Carmichael & Cannon, Sheridan, and Kate M. Fox of Burgess, 
Davis, Carmichael & Cannon, Cheyenne, for Key Bank of Wyoming.

H.W. Rasmussen 
of Badley & Rasmussen, P.C., Sheridan, for Oswalds.

Before MACY, C.J., 
THOMAS, URBIGKIT* and GOLDEN, JJ., and BROWN, J., 
Retired.

* Chief Justice at time of 
oral argument; retired January 1, 
1993.

MACY, Chief 
Justice.

[¶1]      Joe and Mary 
Toland appeal from a summary judgment order in which the district court declared 
that Key Bank of Wyoming, Trustee of the Henry G. 
Oswald and Margaret Oswald Trust, was partially discharged of its obligations as 
guarantor of Oswald Jewelry & Gifts, Inc. in an owner-financed, 
business-sale transaction. The district court discharged Trustee Key Bank to the 
extent that the Tolands had impaired the collateral pledged as security for the 
Oswald Jewelry debt by failing to perfect a first priority security interest in 
such collateral.

[¶2]      We reverse and 
remand.

[¶3]      The Tolands raise 
the following issues for review:

1. Are Appellants Joe and 
Mary Lynn Toland entitled to have the documents used in this transaction 
reformed so that they accurately express the agreement of the parties as it 
existed at the time the documents were signed?

2. Did the Oswald Trust 
consent to the impairment of the collateral in this transaction?

3. Are the Tolands 
entitled to recover damages from the Oswald Trust due to the Oswald Trust's 
failure to provide space for the Tolands to operate their liquor license 
in?

4. Are the Tolands 
entitled to recover additional attorneys fees for the expense of this appeal and 
for any further proceedings, as provided by the contract?

[¶4]      The Tolands 
operated Capitol Drug Store, Inc., as well as a liquor store, in a building 
which they independently owned in Sheridan, Wyoming. Capitol Drug sold 
over-the-counter and prescription drugs as well as sundry merchandise typically 
carried by small-town drug stores. In late 1985, the Tolands decided to sell 
Capitol Drug and retire. They advertised in various trade journals and by word 
of mouth that the business was for sale.

[¶5]      Don and Bonnie 
Oswald, d/b/a Oswald Jewelry & Gifts, Inc., contacted the Tolands in 
September 1987 about buying Capitol Drug. The Tolands and the Oswalds reached a 
preliminary, oral agreement pursuant to which Oswald Jewelry agreed to buy 
Capitol Drug for $160,000 cash and to lease the building from the Tolands. The 
terms of the preliminary, oral agreement were changed by subsequent 
negotiation.

[¶6]      The Oswalds 
contacted Don's parents, Henry and Margaret Oswald, to see if they would assist 
Oswald Jewelry to purchase Capitol Drug. Henry did not want the Oswalds to 
borrow such a large amount of money on behalf of Oswald Jewelry; nor did he want 
the Tolands to have control of the building. Accordingly, Henry informed James 
Sparks, trust manager for Trustee Key Bank, that he wanted the Henry G. Oswald 
and Margaret Oswald Trust to purchase the Tolands' building. Mr. Sparks 
recommended that an attorney be retained to represent the Trust in the 
negotiation of the building purchase.

[¶7]      Following the 
meeting with Mr. Sparks, Henry telephoned the Tolands to broach his concerns 
over the Capitol Drug sale. Henry suggested that the Tolands finance the sale 
and also that they sell their building for $75,000. As consideration, Henry 
offered to guarantee the obligations undertaken by Oswald Jewelry. The Tolands 
were agreeable to these terms, except with respect to the price for the 
building. The Tolands wanted $100,000 for the building.

[¶8]      As negotiations 
over the building were on-going, the Tolands and the Oswalds met with their 
respective attorneys concerning the sale of Capitol Drug. At this meeting, the 
Oswalds' attorney prepared a memorandum which reflected some of the essential 
sale terms as of December 11, 
1987. These terms were that 
the Tolands would sell Capitol Drug for a total purchase price of $160,000, 
receiving a $30,000 down payment and a security interest in the inventory. 
Contingent provisions were also made for the operation of the Tolands' liquor 
store depending upon whether the building sale did or did not 
materialize.

[¶9]      The Tolands and 
Henry ultimately agreed upon a sale price of $85,000 for the building. Mr. 
Sparks thought that "it was a steal." After this deal was struck, the Tolands' 
attorney began to prepare the documents for the sale of Capitol Drug to Oswald 
Jewelry and for the sale of the building to the Trust. He prepared an Agreement 
of Sale of Stock, a Promissory Note, a Guarantee, a Warranty Deed, a Mortgage 
Deed with Release of Homestead, a Security Agreement and Financing Statement, 
and an Agreement not to Compete.

[¶10]   The sale of Capitol Drug to Oswald 
Jewelry was to be accomplished by the Agreement of Sale of Stock, Promissory 
Note, Security Agreement and Financing Statement, and Agreement not to Compete. 
The terms of the Capitol Drug sale required Oswald Jewelry to undertake four 
essential obligations: (1) to pay a purchase price of $150,000 for the drug 
inventory, sundry merchandise, and accounts receivable, plus an additional 
amount for the furniture, fixtures, and equipment; (2) to assume Capitol Drug's 
accounts payable as of midnight on December 31, 1987; (3) to secure payment to 
the Tolands by giving them a security interest in the Capitol Drug inventory, 
maintaining a designated minimum inventory, insuring the inventory, and agreeing 
not to sell the inventory out of the ordinary course of business without the 
Tolands' consent; and (4) to operate the liquor store for the Tolands as 
independent contractors, remitting $150 a month to them.

[¶11]   The sale of the building to the 
Trust was to be accomplished by the Warranty Deed from the Tolands to Trustee 
Key Bank. Trustee Key Bank's guaranty of Oswald Jewelry's obligations was to be 
accomplished by a guaranty provision on the Promissory Note and by a separate 
written Guarantee. Trustee Key Bank's guaranty was to be secured by a Mortgage 
Deed with Release of Homestead on the building to the Tolands.

[¶12]   Two closings were held on 
December 28, 
1987. At the closing on 
Capitol Drug, the Tolands and the Oswalds, on behalf of Oswald Jewelry, executed 
the Agreement of Sale of Stock and an Addendum to Agreement of Sale of Stock 
which deleted the minimum inventory requirement. The Oswalds also executed the 
Promissory Note to the Tolands, and the Tolands executed the Agreement not to 
Compete. The Security Agreement and Financing Statement covering the Capitol 
Drug inventory was not executed. At the closing on the building, the Tolands 
executed the Warranty Deed. Trustee Key Bank signed as guarantor of the 
Promissory Note and executed the separate written Guarantee as well as the 
Mortgage Deed with Release of Homestead back to the Tolands.

[¶13]   The Oswalds took possession of and 
began to operate Capitol Drug on January 
1, 1988. On January 18, 
1988, an Addendum to 
Agreement and an Addendum to Promissory Note were executed. These addenda 
finalized the financial terms of the Capitol Drug sale. Capitol Drug was sold 
for a total purchase price of $160,000. Oswald Jewelry was given a $30,000 
credit for its down payment and a $19,594.59 credit for assuming the accounts 
payable, leaving a balance of $110,405.41 to be paid with interest in 120 
monthly installments.

[¶14]   Oswald Jewelry/Capitol Drug began 
to experience financial difficulties in 1989. As a result, the Oswalds borrowed 
a substantial sum of money from First Interstate Bank on behalf of the 
businesses, pledging the Capitol Drug inventory as collateral. First Interstate 
Bank perfected a first priority security interest in the collateral.

[¶15]   Oswald Jewelry/Capitol Drug's 
financial nosedive continued into 1990. As a result, the Oswalds began to 
negotiate the sale of the Capitol Drug inventory to Buttrey Food and Drug. 
Buttrey would not buy the inventory, however, without receiving the Tolands' 
consent to the sale. Henry, Mr. Sparks, and the Tolands all eventually learned 
of the proposed sale, and, after numerous discussions and some correspondence, 
the Tolands executed the requested consent. The inventory was sold to Buttrey 
for $54,253. The sale proceeds went to First Interstate Bank.

[¶16]   Oswald Jewelry made its last 
payment to the Tolands on February 15, 
1991, leaving an unpaid 
principal amount of $86,179.52. Oswald Jewelry then declared bankruptcy and 
received a discharge from further liability under the Agreement of Sale of Stock 
or Promissory Note. The Tolands notified Trustee Key Bank of Oswald Jewelry's 
default and requested that the default be cured per its guaranty. When it became 
evident that Trustee Key Bank was not going to cure the default, the Tolands 
gave notice of their intent to foreclose on the building.

[¶17]   Trustee Key Bank filed a Complaint 
in district court after it received the Tolands' notice of their intent to 
foreclose. It requested the district court to declare that its obligations as 
guarantor of Oswald Jewelry had been materially altered by the Tolands' failure 
to perfect a first priority security interest in the Capitol Drug inventory, to 
discharge it from liability for the Oswald Jewelry debt either entirely or to 
the extent of the impairment of collateral, i.e., $54,253, and to enjoin 
foreclosure on the building until a final judgment had been entered.

[¶18]   The Tolands responded by filing an 
Answer, Counterclaim and Third Party Complaint. In their Counterclaim, the 
Tolands requested the district court to reform the sale documents to reflect 
that the parties actually agreed at closing that no security interest would be 
taken in the Capitol Drug inventory, to enforce Trustee Key Bank's guaranty 
obligations by entering a judgment for $86,179.52 plus interest and attorney's 
fees, and to order foreclosure on the building. In their Third Party Complaint 
against Henry and Margaret Oswald, the Tolands asserted that Henry and Margaret 
were the real parties of interest, that Henry acted as a de facto trustee for 
the Trust, that Henry induced the Tolands to consent to the Buttrey sale, and 
that Henry and Margaret and Trustee Key Bank should be estopped from denying 
liability.

[¶19]   As discovery proceeded in 
preparation for trial, Trustee Key Bank entered into a contract with Conrads, 
Inc. to lease the building with an option to purchase. The lease/option 
agreement failed to reserve space for the Tolands to operate their liquor store 
or to provide for the operation of their liquor store as required by the 
Agreement of Sale of Stock and the Guarantee. Consequently, the Tolands filed an 
Amended Answer, Counterclaim and Third Party Complaint on September 26, 
1991, to add the liquor store 
damages claim.

[¶20]   Both the Tolands and Trustee Key 
Bank filed motions for summary judgments after the parties' depositions had been 
taken. The Tolands argued in their motion that, although a genuine issue of 
material fact existed as to reformation, they were nevertheless entitled to a 
summary judgment on Trustee Key Bank's guaranty. They contended that Trustee Key 
Bank expressly waived the impairment of collateral defense in the Promissory 
Note and that the de facto trustee, Henry Oswald, impliedly waived the defense 
by inducing the Tolands to consent to the Buttrey sale. The Tolands requested 
the district court to enforce Trustee Key Bank's guaranty through a summary 
judgment by entering a judgment for $86,179.52 plus interest and attorney's 
fees, by ordering foreclosure on the building, and by awarding damages for the 
liquor store claim.

[¶21]   Trustee Key Bank argued in its 
motion that reformation of the documents was inappropriate because the documents 
clearly required the Tolands to hold a security interest in the Capitol Drug 
inventory. Trustee Key Bank contended that it was entitled to a discharge from 
its obligations as guarantor in the amount of $54,253 because of the Tolands' 
failure to perfect their security interest and because the Tolands consented to 
the Buttrey sale. Trustee Key Bank asserted that the waiver provision in the 
Promissory Note did not extend to the impairment of collateral defense and that 
Henry's actions were not binding on the Trust.

[¶22]   Following a hearing on the motions, 
the district court orally ruled on all issues and thereafter filed its summary 
judgment order. It granted a summary declaratory judgment in favor of Trustee 
Key Bank on its claim of discharge in the amount of $54,253 for the Tolands' 
impairment of collateral. Additionally, the district court granted a summary 
judgment in favor of the Tolands on their guaranty claims against Trustee Key 
Bank and ordered foreclosure of the building mortgage to satisfy the judgment of 
$46,505.05.1 The district court "dismissed" the 
Tolands' reformation claim, and it also ordered that the Tolands take no 
additional relief by way of their Third Party Complaint.

[¶23]   Trustee Key Bank promptly paid the 
entire judgment to the Tolands, rendering foreclosure on the building 
unnecessary. The Tolands timely appealed from the district court's summary 
judgment order to raise the issues stated above.

[¶24]   The first issue raised by the 
Tolands is whether the district court erred by "dismissing" their claim for 
reformation of the sales documents. While the order stated that the reformation 
claim was "dismissed," a review of the record reveals that the "dismissal" 
really constituted a summary judgment in favor of Trustee Key Bank. 
Consequently, we will address the reformation issue in light of the standard of 
review applicable to summary judgment orders. As that standard has been often 
repeated by this Court, we are content to merely refer to the applicable 
principles in the context of addressing the parties' arguments.

[¶25]   Preliminary to addressing the 
parties' arguments, it is helpful to review the law as it relates to 
reformation. Reformation is an equitable remedy which emanates from the maxim 
that "`equity treats that as done which ought to have been done.'" 66 AM.JUR.2D 
Reformation of Instruments § 2 at 528 (1973). At its most fundamental level, the 
remedy acknowledges the fact that for one reason or another written instruments 
do not always accurately memorialize the antecedent agreement of the parties. 
See 3 ARTHUR L. CORBIN, CORBIN ON CONTRACTS § 540 (1960). Accordingly, a court 
may reform a written instrument upon clear and convincing evidence of the 
following elements:

"(1) a meeting of the 
minds - a mutual understanding between the parties - prior to the time a writing 
is entered into, (2) a written contract or agreement, (3) which does not conform 
to the understanding, by reason of mutual mistake."

Gasaway v. 
Reiter, 736 P.2d 749, 751 (Wyo. 1987) (quoting Crompton 
v. Bruce, 669 P.2d 930, 934 (Wyo. 1983)).

[¶26]   The Tolands contend that the 
district court ignored testimonial and circumstantial evidence which created a 
genuine issue of material fact regarding whether the parties orally agreed to 
eliminate by addendum both the security interest and the minimum inventory 
provisions of the Agreement of Sale of Stock. They assert that such an agreement 
was reached by the parties' attorneys on account of receiving the guaranty and 
mortgage from Trustee Key Bank. The Tolands explain that the Security Agreement 
and Financing Statement was not executed at the closing and that they never 
perfected a security interest in the Capitol Drug inventory because of this 
agreement. They argue that reformation is necessary because, through inadvertent 
omission, the Addendum to Agreement failed to fully express the parties' 
agreement.

[¶27]   As support for their arguments, the 
Tolands direct us to the deposition testimony of Joe Toland:

Q. At any point in time 
between December 11, and December 11, 
1987, and January 1, 
1988, were there any 
discussions involving whether or not the Security Agreement would be 
necessary?

A. Yes, there 
was.

Q. Who was present during 
those discussions?

A. Both 
lawyers.

Q. Being?

A. Being [the Tolands' 
attorney] and [the Oswalds' attorney].

Q. Were you 
present?

A. Yes.

Q. Yes. What was 
said?

A. They agreed that the 
Security Agreement was not necessary and the Addendum would be made to say that 
- well, actually Henry didn't want me to have any control of what was going on 
in the store, that was obvious.

Q. Do you recall the 
exact date of that meeting?

A. I think it was the 
28th of December.

Q. Are you certain of 
that date, or might it have been a different date?

A. It could have been 
different.

Q. Why was it decided 
that the Security Agreement would not be necessary?

A. Because Henry had 
guaranteed that his son's debts would be paid if he failed to pay 
it.

The Tolands also 
direct our attention to the deposition testimony of James Sparks:

Q. Did [Henry Oswald] ask 
you to negotiate the deal?

A. He asked me which 
attorneys in town I thought should may[]be handle it. He said I didn't need to 
negotiate it, because Joe had it all set up through his information, that we 
just needed to protect the Trust and what did I think we needed to do to satisfy 
Joe's requirements, and to still protect the Trust.

Q. Who did you recommend 
to him to use as an attorney?

A. I believe I 
recommended [the Oswalds' attorney].

Q. And did [the Oswalds' 
attorney], in fact, then represent the Trust?

A. [The Oswalds' 
attorney] represented, did some of the preliminary work and representation of 
the Trust, and I believe that [the Tolands' attorney] drafted most of the 
documents.

Q. Okay. Did anyone other 
than [the Oswalds' attorney] represent the Trust?

A. I don't think 
so.

 [¶28]  The Tolands argue that the combined 
effect of this testimony, when coupled with the circumstantial evidence, is 
sufficient to create a genuine issue of material fact regarding the propriety of 
reformation. We agree. We believe that the evidence in the record, when viewed 
in the light most favorable to the Tolands, creates genuine issues of material 
fact concerning (1) whether the Oswalds' attorney represented both Oswald 
Jewelry and Trustee Key Bank and, if so, (2) whether he and the Tolands' 
attorney agreed, on behalf of their clients, to eliminate by addendum both the 
security interest and minimum inventory interest provisions of the Agreement of 
Sale of Stock. Should both of these issues be resolved affirmatively, 
reformation of the written documents and enforcement of the parties' actual 
agreement would be appropriate. Trustee Key Bank, then, would not be entitled to 
a partial discharge on the basis of the impairment of collateral 
defense.

[¶29]   The second issue raised by the 
Tolands is whether the district court erred by ruling that Trustee Key Bank did 
not waive in writing the impairment of collateral defense. The Tolands 
acknowledge that the failure to perfect a security interest may constitute an 
impairment of collateral. Shaffer v. Davidson, 445 P.2d 13 
(Wyo. 1968); 
Wyo. Stat. § 34.1-3-605(g)(1) 
(1991). They argue, however, that Trustee Key Bank expressly waived all 
suretyship defenses, including the impairment of collateral defense, when it 
signed as guarantor of the Promissory Note. The Tolands request this Court to 
reverse the district court's partial discharge of Trustee Key Bank on this 
ground, regardless of how the reformation issue is resolved.

[¶30]   The waiver provision of the 
Promissory Note provided:

The undersigned and 
endorsers hereof severally waive demand, notice of protest in any defense by 
reason of extension of time of payment or any other indulgence granted by the 
holder of this Note.

The Tolands 
direct our attention to the words "any other indulgence." The essence of their 
position is that these words are so broad that they effectively waive all 
suretyship defenses. Trustee Key Bank counters with essentially an ejusdem 
generis argument. It contends that the phrase waives only indulgences related in 
kind to those already mentioned in the waiver provision. Trustee Key Bank argues 
that the word "indulgence" is a term of art which means 
"forbearance."

[¶31]   Waiver of the impairment of 
collateral defense has been a subject of Wyoming statutory law. The 
statutory provision in effect at the time of this transaction was Wyo. Stat. § 
34-21-373 (1977).2 Section 34-21-373 provided in 
relevant part:

(a) The holder discharges 
any party to the instrument to the extent that without such party's consent the 
holder:

. . .

(ii) Unjustifiably 
impairs any collateral for the instrument given by or on behalf of the party or 
any person against whom he has a right of recourse.

This statutory 
provision provided no guidance as to what would constitute an effective waiver 
of or consent to the impairment of collateral defense. Not surprisingly, the 
Tolands cite case law from jurisdictions which arguably give effect to broad 
language such as that found in this case. Chrysler Credit Corporation v. 
Friendly Ford, Inc., 535 S.W.2d 110 (Mo. Ct. App. 1976); Rhode Island Hospital 
Trust National Bank v. National Health Foundation, 119 R.I. 823, 384 A.2d 301 
(1978). Trustee Key Bank, on the other hand, cites case law to support its 
position that a written waiver of the impairment of collateral defense can be 
accomplished only by "the most unequivocal language in the guaranty contract." 
Carrier Brokers, Inc. v. Spanish Trail, 751 P.2d 258, 262 
(Utah Ct.App. 1988). We think 
that the answer to what constitutes a valid waiver lies somewhere in the 
balance.

[¶32]   In 1991, the Wyoming Legislature 
revised the Uniform Commercial Code. 1991 Wyo. Sess. Laws ch. 160. As 
part of that revision, Wyo. Stat. § 34.1-3-606 (1990) (formerly § 34-21-373) was 
repealed and recreated as § 34.1-3-605. Among other things, § 34.1-3-605 
addresses in more detail the issue of consent to or waiver of the suretyship 
defenses. It provides in pertinent part:

(j) A party is not 
discharged under this section if (1) the party asserting discharge consents to 
the event or conduct that is the basis of the discharge, or (2) the instrument or a separate agreement 
of the party provides for waiver of discharge under this section either 
specifically or by general language indicating that parties waive defenses based 
on suretyship or impairment of collateral.

(Emphasis 
added.) Section 34.1-3-605(j) merely confirms the principle that fair notice is 
central to the validity of a waiver. As provided, a written waiver, when not 
specific, must employ language which fairly indicates the general class of 
actions consented to or defenses waived. Section 34.1-3-605(j).

[¶33]   Examples of adequate waivers can be 
found in related Wyoming case law. In Nauman v. 
CIT Group/Equipment Financing, Inc., 816 P.2d 883 (Wyo. 1991), this Court held 
that the guarantor of a promissory note was not discharged from liability by the 
creditor's election to accept a partial, accelerated payment from the principal 
in a Chapter 11 bankruptcy proceeding. This holding was premised upon a waiver 
provision in the guaranty which provided:

"[Creditor] may at any 
time and from time to time, without our consent, without notice to us and 
without affecting or impairing the obligation of any of us hereunder, do any of 
the following: . . . (b) accept partial payments of said obligations; (c) 
settle, release (by operation of law or otherwise), compound, compromise, 
collect or liquidate any of said obligations and the security therefor in any 
manner. . . ."

816 P.2d  at 885. 
In Schauss v. Garner, 590 P.2d 1316 (Wyo. 1979), the Court held 
that an accommodation party to a promissory note was not discharged from 
liability by the creditor's return of collateral to the principal. This holding 
was premised, in part, upon the waiver clause in the promissory note which 
provided:

"[Creditor] shall be 
under no obligation to apply to the payment [of this note] any funds or property 
belonging to any party liable thereon which may at any time be in its 
possession, and failure to make such application shall not affect the liability 
of any party hereto. . . ."

590 P.2d  at 
1318.

[¶34]   Unlike in Nauman and Schauss, the 
waiver provision in this case did not give Trustee Key Bank fair notice that it 
was waiving the action or defense ultimately relied upon as a ground for 
discharge. The "any other indulgence" language, when read in context, serves 
only to waive leniencies akin to those already mentioned.3 We believe that 
Wyoming law, as well as the 
dictates of fair practice, require more than what was done in this case to 
effectuate a valid waiver of the impairment of collateral defense.4

[¶35]   As an adjunct to their second 
issue, the Tolands argue that Trustee Key Bank impliedly consented to the 
impairment of collateral because alleged de facto trustee, Henry Oswald, induced 
the Tolands to consent to the Buttrey sale. The district court reasoned that the 
Tolands' consent to the Buttrey sale was immaterial because First Interstate 
Bank already had a first priority security interest in the Capitol Drug 
inventory.

[¶36]   We agree with the district court's 
assessment. First Interstate Bank was staged to receive the proceeds from the 
Capitol Drug inventory whether it was sold to Buttrey or disposed of in some 
other fashion. Accordingly, we believe that the present dispute over the 
discharge amount of $54,253 should be resolved by the reformation issue. If the 
Tolands were not required to perfect a security interest in the Capitol Drug 
inventory, then Trustee Key Bank should not be entitled to a discharge for the 
Tolands' failure to do so. If the converse is true, then Trustee Key Bank's 
discharge should stand.

[¶37]   The third issue raised by the 
Tolands concerns their damages claim for Trustee Key Bank's failure to provide 
rent-free space in which to operate their liquor store following Oswald 
Jewelry's default. This claim is premised primarily upon the following clause of 
the Guarantee:

Further, the undersigned 
guarantees that the undersigned shall make available to Joe H. Toland in the 
said building at 129 North Main 
Street, that number of square 
feet presently occupied by him in the operation of his liquor store business. 
This space shall be rent-free.

Trustee Key Bank 
argues that this claim should not lie for various reasons, including 
impossibility of performance and violation of the rule against 
perpetuities.

[¶38]   The record indicates that the 
liquor store damages claim was presented and defended against at the summary 
judgment stage of this case. The district court, however, did not rule on the 
claim. As this Court is a court of review, except in limited circumstances not 
applicable to this case, we decline to address the merits of the liquor store 
damages claim until it has been passed upon at the district court level. See 
Buckman v. United Mine Workers of America, 80 
Wyo. 199, 339 P.2d 398 
(1959).

[¶39]   The fourth and last issue raised by 
the Tolands concerns whether they are to receive attorney's fees for this appeal 
and any further proceedings. We discern no present need to decide this issue. As 
this case is being reversed and remanded, any claims for attorney's fees may be 
presented to the district court at the conclusion of the 
proceedings.

[¶40]   Reversed and remanded for 
proceedings consistent with this opinion.

Footnotes

1 The district court 
arrived at the figure of $46,505.05 by subtracting the discharge amount of 
$54,253 from the unpaid principal amount of $86,179.52 and by adding $2,574.24 
for interest and $12,004.29 for attorney's fees.

2 Renumbered as § 
34.1-3-606 in 1990.

3 The waiver provision in 
the Guarantee provided:

The 
undersigned waives notice of non-payment, protest, and notice of protest with 
respect to the obligations covered by said Agreement and said Note.

4 For an interesting 
comparison, see Flying J, Inc. v. Booth, 773 P.2d 144 
(Wyo. 1989); Security State 
Bank of Basin v. Newton, 707 P.2d 173 
(Wyo. 1985); McKenzie v. Neale 
Construction Company, 75 Wyo. 175, 294 P.2d 355 
(1956); and Blyth v. Pinkerton, 10 
Wyo. 135, 67 P. 619 (1902). 
In these cases, the Court stated that a guarantor's liability will not be 
expanded beyond the express terms of the guaranty by construction or 
implication. As a necessary caveat, the Court warned creditors to express their 
intentions concerning the scope of a guaranty with clarity.