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Studdard v. George D. Warthen Bank
Citations: 427 S.E.2d 58; 207 Ga. App. 80; 93 Fulton County D. Rep. 240; 1993 Ga. App. LEXIS 74Docket: A92A1983
Court: Court of Appeals of Georgia; January 12, 1993; Georgia; State Appellate Court
Appellant-plaintiffs, Studdard et al., filed a lawsuit against appellee-defendants, George D. Wathen Bank et al., alleging breach of an agreement for an $80,000 loan, claiming fraud and breach of contract. Appellees counterclaimed for recovery on notes that appellants allegedly defaulted on. After discovery, appellees successfully moved for summary judgment on both their counterclaim and appellants' claims, leading to this appeal. The court found that, even when considering the evidence favorably for the appellants, they only borrowed $40,000 under an oral extension of a $120,000 line of credit and were subsequently denied the additional $80,000. The court highlighted that any commitment to lend the additional amount required a signed writing as per the Georgia Statute of Frauds (OCGA § 13-5-30). The court concluded that the act of lending $40,000 did not negate the requirement for a written agreement for the additional funds, as it did not prove an agreement existed for the larger loan. Regarding the fraud claim, the court ruled that fraud cannot be based on an unenforceable promise, emphasizing that an oral contract that does not comply with the Statute of Frauds is unenforceable. Therefore, the alleged breach of such a contract does not support a fraud claim. For the appellees' counterclaim, the court noted that there was no dispute over the execution of the notes or appellants' default. Appellees demonstrated the amounts owed, and appellants failed to provide evidence of any material fact issues. The court affirmed the trial court's summary judgment in favor of appellees on both the contract and fraud claims, as well as on the counterclaim for unpaid notes.