1

The plaintiff’s motion for leave to file surreply, (Doc. 12), which has not drawn

objection by the defendant, is granted.

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

GULF OFFSHORE LOGISTICS, LLC, )

 )

Plaintiff, )

 )

v. ) CIVIL ACTION 09-0688-WS-N

 )

THOMAS B. BENDER, JR., )

 )

Defendant. )

ORDER

This matter is before the Court on the defendant’s motion to dismiss. (Doc. 5). 

The parties have filed briefs in support of their respective positions, (Docs. 5, 9, 11, 12),1

and the motion is ripe for resolution. After carefully considering the foregoing and other

relevant material in the file, the Court concludes that the motion is due to be denied.

BACKGROUND

According to the complaint, the plaintiff entered an agreement with Bender

Shipbuilding & Repair, Inc. (“Bender”), pursuant to which the plaintiff paid to Bender $1

million to hold the delivery date and production capacity for construction of a $43 million

vessel, pending further negotiation towards a contract for construction of the vessel. The

agreement provided that, should the plaintiff for specified reasons not proceed to contract

with Bender, the $1 million would be returned to the plaintiff. In connection with this

agreement, the defendant executed a personal guaranty. The plaintiff did not proceed to

contract with Bender. Bender returned $400,000 to the plaintiff, but the principal sum of

$600,000 remains unpaid. In this litigation, the plaintiff seeks to recover the balance, plus

interest, costs and attorney’s fees, from the defendant based on his guaranty. (Doc. 1 &

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2

See Park City Water Authority v. North Fork Apartments, L .P. 2009 WL 4898354

at *1 n.2 (S.D. Ala. 2009) (citing cases from over 40 districts applying the rule in 2009

alone).

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Exhibits A, B).

The defendant argues the plaintiff lacks capacity to bring this action because it is a

foreign corporation and lacks a certificate of authority to transact business in Alabama. 

The defendant also argues that the complaint fails to allege that the conditions precedent

to recovery on the guaranty have been satisfied.

I. Qualification to Transact Business. 

The defendant has adequately demonstrated that the plaintiff is a foreign

corporation and that it has not obtained a certificate of authority. Indeed, the plaintiff

concedes as much. The question becomes the effect of these facts.

In his principal brief, the defendant simply cited, without argument or authority,

Section 10-2B-15.02 of the Alabama Code. (Doc. 5 at 2 ¶ 4; id. at 6). The plaintiff in

response relied on the well-known interstate commerce exception to Section 10-2B-15.02. 

In reply, the defendant for the first time addressed the interstate commerce issue, even

though it was at all times plainly the key to the motion. This is improper, because district

courts, including this one, ordinarily do not consider arguments raised for the first time on

reply.2

 It is true that the defendant asserted the applicability of Section 10-2B-15.02 in

his opening brief, but he was not at liberty simply to cite the provision and delay any

discussion of it and its interstate commerce exception until his reply brief. Nevertheless,

because the plaintiff has requested and received permission to file a surreply, the Court

does not reject the defendant’s argument as tardy.

It is, however, inadequate. The defendant argues, without explanation or authority,

that the guaranty should be viewed in isolation from the agreement with Bender to which

it is related. The defendant does not suggest that the agreement with Bender is intrastate,

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but instead argues that the guaranty, on its own, is a purely intrastate transaction. (Doc.

11 at 2). 

Assuming without deciding that the guaranty on its own may be viewed as

intrastate, the defendant has not established that it is legally permissible to consider the

guaranty in isolation for purposes of Section 10-2B-15.02. The plaintiff, on the other

hand, has cited a case, decided under the predecessor to Section 10-2B-15.02, in which

the plaintiff’s ability to sue on a personal guaranty was determined, not by viewing the

guaranty on its own, but by evaluating the plaintiff’s conduct as to the underlying

contract. North Alabama Marine, Inc. v. Sea Ray Boats, Inc., 533 So. 2d 598 (Ala. 1988). 

To similar effect is Sharer v. Bend Millwork Systems, Inc., 600 So. 2d 223 (Ala. 1992). 

The defendant has not acknowledged, much less distinguished, these cases. 

Accordingly, he has not met his burden on motion to dismiss.

II. Pleading of Conditions Precedent. 

By its terms, the guaranty is one “of collection only.” (Doc. 1, Exhibit B, ¶ 1). By

its terms, the plaintiff “shall first take all necessary, reasonable and legal actions

including exercise of any remedies provided to [the plaintiff] under the Letter Agreement

to collect so much of the sums guaranteed hereby as can be obtained by diligent pursuit of

such actions from Bender before making demand of [the defendant] under this Guaranty.” 

(Id.). The parties agree that the contractual terms parallel the requirements of Alabama

law, under which “the guarantor agrees to pay a debt only if the claim is not, after

exercise of every reasonable effort on the part of the creditor, collectable from the

principal.” Shur-Grain Feed Division William-Davies Co. v. Huntsville Production

Credit Association, 372 So. 2d 1317, 1320 (Ala. Civ. App. 1979). (Doc. 5 at 7; Doc. 9 at

7).

The defendant argues that the complaint must be dismissed because it “fails to

allege that the specific conditions precedent specified in the Personal Guaranty and

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required under Alabama law have been satisfied.” (Doc. 5, ¶ 5). In particular, that it

“does not allege that every reasonable effort to collect from the principal has been

exhausted.” (Id. at 7). The problem is that the complaint explicitly alleges that “[a]ll

conditions precedent to [the plaintiff’s] recovery under the Personal Guaranty have been

satisfied.” (Doc. 11 at 5). This language satisfies the plaintiff’s pleading burden, because

“[i]n pleading conditions precedent, it suffices to allege generally that all conditions

precedent have occurred or been performed.” Fed. R. Civ. P. 9(c). The defendant has not

addressed Rule 9(c) or explained how it could fail to control here.

The complaint elsewhere alleges that the plaintiff has “diligently engaged in

efforts to collect the debt from Bender by, among other things, filing a proof of claim in

Bender’s bankruptcy case for the amount of the outstanding debt owed by Bender under

the Letter Agreement.” The complaint continues, “No payments have been made to [the

plaintiff] from the bankruptcy estate, and the likelihood that Bender will have the

requisite funds to pay its unsecured creditors is highly unlikely.” The complaint

concludes that, “[a]s such, further attempts for [sic] collection from Bender would be

fruitless.” (Doc. 1, ¶¶ 12-13). 

The defendant notes this language and argues that, “[u]nless and until the plaintiff

can allege that its claim in the Chapter 11 case has been finally disallowed or that all

monies payable with respect to its claim have been determined and paid, it does not allege

a claim under the specific language of the Personal Guaranty or under Alabama law upon

which relief can be granted.” (Doc. 5 at 8). This is not an argument that the complaint

fails to satisfy applicable pleading requirements but one that, as a matter of law, the

plaintiff cannot proceed on a conditional guaranty before bankruptcy proceedings against

the principal have concluded. The defendant offers no reasoning or authority (beyond a

bald citation to Shur-Grain) in support of this position, and the Court will not construct an

argument on his behalf. Whether or not he could ultimately establish this as the law, he

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In his reply brief, the defendant for the first time argues (in two sentences) that the

dispute is not ripe. (Doc. 11 at 3). As discussed above, this new argument comes too late

to be considered.

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has not done so on motion to dismiss.3 

CONCLUSION 

For the reasons set forth above, the defendant’s motion to dismiss is denied.

DONE and ORDERED this 27th day of January, 2010.

s/ WILLIAM H. STEELE

UNITED STATES DISTRICT JUDGE

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