The opinion of the court was delivered by: Mills, District Judge:
Is the guarantor discharged from liability where the
creditor fails to perfect its security interest in the
Summary judgment for Plaintiff.
This suit is brought by the Federal Deposit Insurance
Corporation (FDIC), in its corporate capacity. The FDIC seeks
to collect on a note and related guaranty which it purchased
from the receiver of an insolvent bank. Dennis Hardt is the
maker of the note and Theodore Hardt is the guarantor of the
note. The first count seeks collection against the maker and
the second count predicates liability on the guaranty
agreement. This Court has since dismissed Count I for failure
to serve process on Defendant Dennis Hardt.
The matter is now before the Court on cross motions for
summary judgment as to Count II. Because the FDIC appears in
its corporate capacity, jurisdiction is properly based on
12 U.S.C. § 1819 (1982). See Federal Deposit Ins. Corp. v.
Braemoor Associates, 686 F.2d 550 (7th Cir. 1982). The issue
raised on the cross motions is whether the guarantor is
discharged from the liability on the guaranty agreement due to
the creditor's failure to perfect a security interest in
collateral securing the underlying obligation.
The facts are not in dispute. Dennis Hardt signed and
executed a promissory note payable to First National Bank of
Danvers on April 28, 1983. The note was to be secured by a
Ford van. In connection with the note, Theodore Hardt entered
into a guaranty agreement with the bank on April 20, 1983. He
agreed to guarantee repayment of the obligation up to $18,000.
The bank failed to perfect a security interest in the Ford
On or about August 5, 1983, the Comptroller of the Currency
determined that the bank was insolvent, ordered the bank
closed, and tendered to FDIC the appointment as Receiver of
the bank. FDIC, as receiver, solicited bids and sold certain
assets and liabilities of the bank. FDIC, in its corporate
capacity, purchased the note and guaranty in question. FDIC
made a demand for payment upon both the maker and the
guarantor and both parties defaulted on the respective
agreements. We are now concerned only with the liability of
the personal guaranty of Theodore Hardt.
Summary judgment is proper only when "there is no genuine
issue as to any material fact and . . . the moving party is
entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c).
Cross motions for summary judgment require no less careful
scrutiny of the factual allegations. Lac Courte Oreilles Band
of Lake Superior Chippewa Indians v. Voight, 700 F.2d 341, 349
(7th Cir. 1983).
In determining whether such undisputed facts entitle one of
the parties to judgment in their favor, the Court's inquiry
"unavoidably asks whether reasonable jurors could find by a
preponderance of the evidence that the [moving party] is
entitled to a verdict — `whether there is [evidence] upon
which a jury can properly proceed to find a verdict for the
party producing it, upon whom the onus of proof is imposed.'"
Anderson v. Liberty Lobby, Inc., ___ U.S. ___, 106 S.Ct. 2505,
2511, 91 L.Ed.2d 202 (quoting Improvement Co. v. Munson, 14
Wall. 442, 448 (1872) (emphasis in original)).
The parties are essentially in agreement as to the facts
that are necessary to resolve the issues presented by the
motions now before the Court. The entry of ...