Sign In
Events
Newsletters
Search

Close

Close Search

Cancel

SEARCH
MY LAW.COMNEW

Georgialina Enters. Inc. v. Frakes

Jury questions remained as to whether the parties intended for a subsequent promissory note to extinguish the security interest created in the parties' original note.

X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Lawrence and Patricia Frakes bought a carwash from Georgialina Enterprises, Inc. and partially financed the purchase by borrowing $100,000 from the sellers, evidenced by a purchase-money promissory note and a deed to secure debt on the property. Six months later, Sunset Landings, Inc., a corporation formed by Mr. Frakes, entered into a promissory note in favor of Georgialina, which stated that it “superseded” the earlier note but that it was secured by the same deed to secure debt. The main issue on appeal is whether the second note functioned as a complete novation of the earlier note and thereby also nullified the deed to secure debt so that Georgialina no longer has any rights against the Frakes or the property.

Sunset Landings signed the second note in 1996. Two years later after Georgialina concluded that someone failed to make payments, it issued a demand letter to the Frakes in which it purported to accelerate the balance due. In response, the Frakes filed suit against Georgialina and Wayne Raiford, its president, alleging that they fraudulently induced the Frakes into buying the car wash. Georgialina and Raiford answered and counterclaimed on the note, and for fraud in connection with a lake-front lot that was allegedly part of the consideration for the sale. They then sought summary judgment on the Frakes’ claims and on their first counterclaim, i.e., the note. In response, the Frakes amended their complaint to assert that the first note had been “extinguished, superseded and discharged” by the second note and that the deed to secure debt should be canceled. The Frakes then filed a cross-motion for summary judgment on the same issues. The Frakes later dismissed their fraud claim against Georgialina, but not against Raiford.

Trending Stories

 
Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.

LEARN MORE

More From ALM

Premium Subscription
With this subscription you will receive unlimited access to high quality, online, on-demand premium content from well-respected faculty in the legal industry. This is perfect for attorneys licensed in multiple jurisdictions or for attorneys that have fulfilled their CLE requirement but need to access resourceful information for their practice areas.
View Now
Team Accounts
Our Team Account subscription service is for legal teams of four or more attorneys. Each attorney is granted unlimited access to high quality, on-demand premium content from well-respected faculty in the legal industry along with administrative access to easily manage CLE for the entire team.
View Now
Bundle Subscriptions
Gain access to some of the most knowledgeable and experienced attorneys with our 2 bundle options! Our Compliance bundles are curated by CLE Counselors and include current legal topics and challenges within the industry. Our second option allows you to build your bundle and strategically select the content that pertains to your needs. Both options are priced the same.
View Now
Go to CLE Center
GlobeSt. Women of Influence (WOI) 2024
July 22, 2024 - July 24, 2024
Lake Tahoe, CA

GlobeSt. Women of Influence Conference celebrates the women who drive the commercial real estate industry forward.


Learn More
New York Legal Awards 2024
September 05, 2024
New York, NY

The New York Law Journal honors attorneys and judges who have made a remarkable difference in the legal profession in New York.


Learn More
African Legal Awards 2024
September 06, 2024
Johannesburg

The African Legal Awards recognise exceptional achievement within Africa s legal community during a period of rapid change.


Learn More
Go to Events Go to Webcasts
General Counsel

The University of New Mexico (UNM) (https://www.unm.edu/) is seeking nominations, inquiries, and applications for the position of General Co...


Apply Now ›
Insurance Coverage Associate

Maslon LLP is seeking attorney candidates with 4-6 years of experience to join its Insurance Coverage Team. Maslon s Insurance Recovery Grou...


Apply Now ›
Litigation Attorney -- New York

New York-based indie music company seeks full-time litigation attorney. Must have 2 years music business experience. Must be admitted to S...


Apply Now ›
Go to Lawjobs
Lawyers of Distinction
06/27/2024
The American Lawyer

Professional Announcement


View Announcement ›
SMGQ Law
06/21/2024
Daily Business Review

Full Page Announcement


View Announcement ›
Blume Forte Fried Zerres & Molinari
06/14/2024
New Jersey Law Journal

Professional Announcement


View Announcement ›
Go to Professional Announcements