Case Name: SOUTH ATLANTA ASSOCIATES, LTD. v. STRELZIK et al.
Court: Court of Appeals of Georgia
Jurisdiction: Georgia
Decision Date: 1989-07-14
Citations: 192 Ga. App. 574
Docket Number: A89A0444
Parties: SOUTH ATLANTA ASSOCIATES, LTD. v. STRELZIK et al.
Judges: Deen, P. J., Birdsong and Pope, JJ., concur. Parley, C. J., McMurray, P. J., Banke, P. J., Benham and Beasley, JJ., concur in part and dissent in part.
Reporter: Georgia Appeals Reports
Volume: 192
Pages: 574–583

Head Matter:
A89A0444.
SOUTH ATLANTA ASSOCIATES, LTD. v. STRELZIK et al.
(385 SE2d 439)

Opinion:
Sognier, Judge.
South Atlanta Associates, Ltd. (SAA) brought suit against Steven Strelzik pursuant to an agreement in which Strelzik guaranteed payment of sums due SAA under a lease agreement between it and Housecall, Inc., the company in which Strelzik was president. Strelzik brought a third party suit against Daniel Shefte, a cosigner of the guaranty, and the trial court allowed SAA to add Shefte as a party defendant. The trial court then granted summary judgment solely to Strelzik and denied SAA's motion for summary judgment. This appeal ensued.
Appellant contends the trial court erred by granting summary judgment in favor of appellee Strelzik and denying its motion for summary judgment as to both Strelzik and Shefte because as a matter of law the guaranty agreement executed by appellees entitled appellant to recover from them the sums due it from Housecall. The record reveals that appellant tendered a contract to Housecall consisting of a lease agreement and, as referenced in paragraph 38 of the lease, a guaranty agreement which required the sole signature of Housecall's president, appellee Strelzik. While the lease agreement in its original form was accepted and executed by the parties, appellant's guaranty agreement was rejected and a modified guaranty agreement was presented to appellant, which plainly and unambiguously required the signature as guarantor not only of Strelzik, but also of appellee Shefte and Richard Midlick. However, when the guaranty agreement was proffered to appellant, only Strelzik and Shefte had signed the document. The evidence is uncontroverted that appellant accepted the modified guaranty agreement in satisfaction of paragraph 38 of the lease agreement and Housecall was allowed to enter into the leased space. Upon Housecall initiating bankruptcy proceedings, appellant then sought to enforce the guaranty agreement as to both Strelzik and Shefte.
1. We find no error in the trial court's denial of appellant's motion for summary judgment because contrary to appellant's argument, we do not agree that the contract agreed upon by the parties required only the one signature of Strelzik to bind the parties. Appellant tendered a lease agreement which, in paragraph 38, provided that the lease would be effective only upon execution both of the lease "and upon the execution of the Guaranty Agreement annexed hereto by Steven J. Strelzik." (Emphasis supplied.) It is uncontroverted that the annexed guaranty agreement tendered by appellant was not accepted, but instead the contract (which by the express terms of the lease consisted of both the lease agreement and the guaranty agreement) was "accepted" with terms varying from the original offer, namely, with a three signature guaranty agreement rather than the one signature guaranty presented by appellant. This "acceptance" operated as a matter of law as a rejection of appellant's original offer and constituted a counteroffer, see Duval & Co. v. Malcom, 233 Ga. 784, 787 (214 SE2d 356) (1975), which appellant thereafter uncon-trovertedly accepted. Thus, whatever the original intention of the parties when entering into the initial negotiations, the. contract between the parties did not consist of the lease agreement with a one signature guaranty, as asserted by appellant and the dissent to this division, because that offer was uncontrovertedly rejected when the counteroffer with different terms was made. Rather, the contract consists of the lease agreement with a three signature guaranty which appellant undisputedly accepted. Accordingly, the terms of the original offer never became the basis of any contract between the parties and its terms cannot now be reinstated by this court and imposed upon the parties since the terms of the original offer have been superseded and are controlled by the terms of the contract actually executed by the parties.
Where the language employed by parties to a contract is plain, unambiguous, and capable of only one reasonable interpretation, no construction of the contract is required to ascertain the intention of the parties. See generally Citicorp Indus. Credit v. Rountree, 185 Ga. App. 417, 421 (364 SE2d 65) (1987). Therefore, because the record here uncontrovertedly establishes that the contract accepted by appellant required three signatures on the guaranty agreement, appellant is bound by those terms, not by the rejected terms of the original offer, and the trial court did not err by denying appellant's motion for summary judgment.,
2. The trial court did err by granting Strelzik's motion for summary judgment because a question of fact exists whether a valid contract was created between the parties. At the time of the drafting of that guaranty agreement which became part of the contract between the parties here, see Division 1, it is clear the drawers intended there be three signatures on the guaranty. The record contains no affidavits, depositions, or other sworn evidence by Strelzik or Shefte to indicate whether their intent in executing the guaranty was anything other than the expressed intent set forth in the document, that there be three guarantors of the lease agreement. However, the absence of the third required signature on the guaranty agreement did not necessarily render that document incomplete and thus unenforceable, as asserted by the dissent to this division. Although the record fails to disclose when Strelzik or Shefte signed the document, the record does contain uncontroverted affidavits by Melissa Barre (the employee charged with monitoring tenant compliance with the terms of appellant's lease agreements) that she received the guaranty agreement from Strelzik. This evidence raises the inference that Strelzik, at least, knew or should have known when he tendered the document to appellant that Midlick's signature thereon was missing. A conflict thus exists between the plain and unambiguous language of the guaranty agreement and Strelzik's subsequent action in forwarding to appellant in satisfaction of paragraph 38 of the lease agreement a guaranty document containing only two of the three required signatures.
While aware that "[t]he contract of suretyship is one of strict law; and the surety's liability will not be extended by implication or interpretation," OCGA § 10-7-3, the law also acknowledges that alteration of a surety's liability does not extinguish that liability where it is done with the surety's knowledge and consent. See OCGA § 10-7-21; see generally Washington Loan &c. Co. v. Holliday, 26 Ga. App. 792 (a) (107 SE 370) (1921); Bank of Terrell v. Webb, 177 Ga. App. 715-716 (341 SE2d 258) (1986). In view of the evidence that Strelzik forwarded the guaranty agreement with its two signatures to appellant, evidence which conflicts both with the language of the guaranty agreement and the fact found by the trial court that Strelzik and Shefte thought that there would be three guarantors to the agreement, a question exists for the trier of fact to determine whether Strelzik consented to, if not initiated, the alteration of the terms of the guaranty agreement, or whether the parties mutually departed from or waived the contractual provision requiring three signatures. See generally Union &c. Leasing Corp. v. Beef 'N Burgundy, 155 Ga. App. 257, 261 (270 SE2d 696) (1980); Mauldin v. Lowe's of Macon, 146 Ga. App. 539, 542 (246 SE2d 726) (1978); California Fed. Savings &c. Assn. v. Hudson, 185 Ga. App. 384, 388 (4) (364 SE2d 582) (1987).
In summary, we hold in Division 2 that the trial court erred by > granting summary judgment in favor of Strelzik, but hold in Division 1 that the trial court did not err by denying appellant's motion for summary judgment as to Strelzik and Shefte. Therefore, the judgment is affirmed in part and reversed in part.
Judgment affirmed in part and reversed in part.
Deen, P. J., Birdsong and Pope, JJ., concur. Parley, C. J., McMurray, P. J., Banke, P. J., Benham and Beasley, JJ., concur in part and dissent in part.