The opinion of the court was delivered by: Aspen, District Judge:
MEMORANDUM OPINION AND ORDER
This action arises out of a demand by plaintiff National
Acceptance Company of America ("NAC") for payment of the
amount due on certain loans for which defendant James M.
Wechsler was the guarantor. The loans were made to Detroit
Harbor Terminals, Inc. ("Detroit Harbor"),
pursuant to separate agreements between NAC and Detroit Harbor
in September, 1974, and July, 1976. At the time each of these
agreements was executed, Wechsler also signed individual
guaranties whereby he promised to assume responsibility for
Detroit Harbor's indebtedness. On May 9, 1978, NAC notified
Wechsler of Detroit Harbor's default on the amount due under
the two loan agreements — nearly $500,000 — and demanded from
him payment of that sum pursuant to the guaranties he signed.
When Wechsler failed to pay the amount due, NAC filed this
diversity action. 28 U.S.C. § 1332.
The case now is before the Court on NAC's motion for summary
judgment. NAC submits that there is no dispute as to the
following facts: (1) that defendant Wechsler signed the
individual guaranties in question; (2) that NAC made loans to
Detroit Harbor in the amount of $800,000; and (3) that Detroit
Harbor has defaulted on the loan payments. Based on these
facts, NAC argues that Wechsler as a matter of law is liable
under the guaranties for the amount due. The defendant has
failed to introduce any persuasive evidence in rebuttal of
these factual assertions. Rather, defendant resists the motion
for summary judgment on the grounds that the numerous
affirmative defenses and counterclaims he raises — thirteen in
all — involve unresolved issues of fact that render summary
adjudication of this action inappropriate.
The Seventh Circuit has observed that "[w]ith the ever
increasing burden upon the judiciary, persuasive reasons exist
for the utilization of summary judgment procedure whenever
appropriate." Kirk v. Home Indemnity Co., 431 F.2d 554, 560
(7th Cir. 1970). The benefit of this procedure is that it
permits the court to avoid a useless trial when there are no
factual disputes remaining in a case. Nonetheless, it is not
within the province of the Court to resolve issues of disputed
material fact in a trial by affidavit. Moutoux v. Gulling Auto
Electric, Inc., 295 F.2d 573, 576 (7th Cir. 1961). "[T]he party
moving for summary judgment has the burden of clearly
establishing the non-existence of any genuine issue of fact
that is material to a judgment in [its] favor." Cedillo v.
International Association of Bridge & Structural Iron Workers,
Local Union No. 1, 603 F.2d 7, 10 (7th Cir. 1979). Any doubts
must be resolved against the moving party. Moutoux, 295 F.2d at
576. It is in light of these principles that the Court will
address the issues raised by defendant's affirmative defenses
I. PROCEDURAL AFFIRMATIVE DEFENSES
In affirmative defenses I through VI, defendant claims that
the complaint fails to state a claim upon which relief may be
granted; that the Court lacks personal jurisdiction of
Wechsler and subject matter jurisdiction of this action; that
service of process was insufficient; that venue is improper in
the Northern District of Illinois; and that the action must be
dismissed for failure to join a number of necessary parties
pursuant to Fed.R.Civ.P. 19(a). For the reasons that follow,
the Court finds all these claims to be without merit.
Defendant's argument that the complaint fails to state a
claim is based on a misreading of the complaint. Defendant
suggests that the complaint fails to allege that Detroit
Harbor has defaulted on payment of the amount due to NAC under
the loan agreements or the amount of the indebtedness; yet
that information is set forth clearly in the complaint.
See Count I, ¶¶ 5, 9, 11; Count II, ¶¶ 8, 10, 12. Accordingly,
the Court finds that the complaint adequately sets forth "a
short and plain statement of the claim" as required by
Fed.R.Civ.P. 8(a). Conley v. Gibson, 355 U.S. 41, 47-48, 78
S.Ct. 99, 103, 2 L.Ed.2d 80 (1957); Austin v. House of Vision,
385 F.2d 171 (7th Cir. 1967).*fn1
Defendant's positions with respect to personal jurisdiction
and service of process are interrelated; he asserts that the
Court lacks personal jurisdiction over him because the service
of process was insufficient. Under the guaranty contracts,
Wechsler designated as his agent for service of process, H. G.
Kanes, the past president of NAC. Pursuant to these contracts,
it was agreed that Kanes would forward process to Wechsler
within five days of service. By these contracts, Wechsler also
agreed to submit to personal jurisdiction in the Northern
District of Illinois.
Wechsler, however, now argues that Kanes' affiliation with
NAC creates a conflict of interest which invalidates Kanes'
appointment as his agent for process. This contention,
however, was considered and rejected in National Equipment
Rental Ltd. v. Szukhent, 375 U.S. 311, 317-318, 84 S.Ct. 411,
415, 11 L.Ed.2d 354 (1964):
. . [S]uch a contention ignores the narrowly
limited nature of the agency here involved.
Florence Weinberg was appointed the respondents'
agent for the single purpose of receiving service
of process. An agent with authority so limited
can in no meaningful sense be deemed to have an
interest antagonistic to the respondents, since
both the petitioner and the respondents had an
equal interest in assuring that, in the event of
litigation, the latter be given that adequate and
timely notice which is a prerequisite to a valid
See also National Acceptance Company of America v. Darby K.
Coal Company, Inc., Civil Case No. 76 C 1857, Unpublished Op.
at 2 (N.D.Ill., December 23, 1976). Defendant further alleges
that Kanes failed to forward the process to Wechsler within the
agreed five-day period. If this were the case, then the service
of process would be invalid. Szukhent, 375 U.S. at 318, 84
S.Ct. at 415. NAC, however, has supplied an affidavit by Kanes
attesting to the fact that he received service on June 14,
1978, and forwarded the process to the defendant on June 19,
1978. In addition, NAC has submitted a true and correct copy of
a certified mail receipt indicating that service was forwarded
on June 19, 1978. In the face of this evidence, defendant's
unsupported allegations are insufficient to raise a factual
issue concerning the validity of process or of personal
With respect to joinder under Rule 19(a), defendant asserts
that because Detroit Harbor is "jointly and severally liable"
for the amount due NAC, it is an indispensable party to this
action. Defendant also lists as necessary parties several
other entities who are parties in related actions pending in
the Eastern District of Michigan. The Court, however, has
grave doubts that these parties are indispensable for the
purposes of Rule 19(a). See Dunlop v. Beloit College,
411 F. Supp. 398, 403 (W.D.Wis. 1976). Moreover, the Court finds
that the defendant has waived any right to raise this issue.
Despite the importance of Rule 19 joinder, there is no bar to
waiver of that right by a party. See State Farm Mutual Auto
Insurance Co. v. Mid-Continent Casualty Co., 518 F.2d 292 (10th
Cir. 1975); Process Control v. Tullahoma Hot Mix Paving Co., 79
F.R.D. 223 (E.D.Tenn. 1977).*fn2 These guaranty contracts
expressly provide that NAC is not required to "prosecute
collection or seek to enforce or resort to any remedies against
Debtor or any other party liable to Lender on account of
Debtor's Liabilities or any guaranty thereof." This contractual
provision would be rendered a nullity were the Court to require
NAC to join a myriad of other parties in this proceeding.
Indeed, the very purpose of a guaranty agreement — to provide
a simple means of compelling payment of a debt due — would be
eviscerated by requiring such joinder. On the basis of a
similar provision, the court in National Acceptance Company of
America v. Demes, 446 F. Supp. 388, 389 (N.D.Ill. 1977), reached
the same conclusion.
Defendant's attacks on subject matter jurisdiction and venue
are derivative of his theory with respect to joinder. He
argues that since joinder of an essential party — the State of
Michigan — is impossible, the Court is without subject matter
jurisdiction. In addition, he suggests that joinder of all the
essential parties in this action would create jurisdiction
under federal substantive law, thereby rendering venue improper
in this district. Compare 28 U.S.C. § 1391(a) (venue in
diversity cases) with 28 U.S.C. § 1391(b) (venue in cases
arising under federal law). Inasmuch as the Court rejects
defendant's argument with respect to joinder, it rejects the
subject matter jurisdiction and venue arguments as well.*fn3
Accordingly, the plaintiff's motion for summary judgment is
granted as to defendant's ...