The opinion of the court was delivered by: BY THE COURT; JAMES T. GILES
Defendant JWP Credit Corp. ("JWP") has filed a motion for summary judgment on its counter-claim against individual plaintiffs James Christensen, Stephen Christensen, F. Lavar Christensen, James Hamel, and Jerry Hamel ("Plaintiffs" or "Guarantors"). JWP seeks to enforce the terms of guaranties
which the Plaintiffs made on a loan and security agreement between co-plaintiff FMG, Inc. ("FMG") and JWP. This court grants JWP's motion for summary judgment for the reasons stated below.
I. FACTUAL AND PROCEDURAL BACKGROUND
According to the complaint, FMG's mall space was made available to it several months later than anticipated. As a result, it was under extreme time pressure to complete its facilities so that they would be ready for the mall's grand opening. FMG avers that Forest Electric knew of this time pressure and nevertheless performed substandard work which caused a series of delays and overruns. The result was a three-month time lag between the opening of the mall and the opening of the entertainment facility, and a resultant loss in potential revenues. FMG also claims that Forest Electric's subpar work caused it to incur additional bills from other subcontractors because they were not able to perform their work according to schedule.
In addition to alleging substandard work on the part of Forest Electric, FMG claims that Forest Electric deliberately exploited FMG's vulnerable position by submitting inflated bills. FMG claims that it was coerced into paying these bills with threats that the electrical power in its mall space would be shut off. According to the complaint, electrical power was in fact shut off for one six-hour period.
FMG further alleges that co-defendants Forest Electric and JWP exploited FMG's position by forcing it to enter into a credit arrangement with JWP, which is the sole shareholder of Forest Electric. Plaintiff's Memorandum in Opposition to Motion for Summary Judgment, Exhibit C at 5. JWP provided FMG with a loan of $ 500,000 to facilitate payment of monies owed to Forest Electric for electrical work. Plaintiffs executed a joint personal guaranty on the loan. FMG argues that, due to the self-serving tactics of Forest Electric, it had no other option but to enter into the loan agreement.
FMG and Guarantors filed suit against Forest Electric and JWP on June 28, 1991. Based upon the above-mentioned allegations, they allege misrepresentation and fraud, economic duress, mistake of fact, breach of contractual duty of good faith and fair dealing, and conspiracy to defraud. FMG seeks restitution of payments made to Forest Electric, rescission of its loan agreement with JWP, and other damages (Counts I-V). Guarantors seek a declaration that the guaranty agreement is null and void (Count VI).
In response to the amended complaint (filed before defendants answered the original complaint), JWP filed a counter-claim seeking to enforce the guaranty agreement against the individual plaintiffs, since FMG had by that time defaulted on its payments under the loan agreement.
JWP has now moved for summary judgment on the counter-claim.
II. SUMMARY JUDGMENT STANDARD
Summary judgment will be entered if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c). It is the moving party which must "demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). Once the moving party makes such a showing, the burden shifts to the nonmoving party to "set forth specific facts showing that there is a genuine issue for trial." Fed. R. Civ. P. 56(e). The nonmoving party must satisfy this burden through the introduction of testimony "as would be admissible in evidence," Id., such as an affidavit or deposition testimony. Fed. R. Civ. P. 56(c). If, however, the moving party ...