Saturday, May 10, 2008

In another guaranty dispute, the Nebraska Supreme Court reverses the Nemaha County District Court in party when the Supreme Court finds a guarantor's obligation to guarantee the payment of two promissory notes his son and daughter-in-law signed extended only to his unconditional promise to guarantee payment on the first promissory note, but not to the Bank's extension of credit to the son and daughter-in-law from a second promissory note when the primary borrowers showed they were creditworthy according to the financial disclosures they made to the bank. The Nemaha County Court found the guarantor liable for the entire indebtedness, including the second extension of credit. The District Court dismissed the guarantor entirely. The Supreme Court holds the guarantor liable for the initial indebtedness, but not for the extension. First Nat. Bank of Unadilla v. Betts, S-07-023, 275 Neb. 665

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