Armstrong Business Services, Inc. v. AmSouth Bank and Leonard "Bo" Marks

Summary

The Alabama Supreme Court reviewed a summary judgment entered for AmSouth Bank and its employee in claims arising from failed negotiations for a $5.2 million loan. The court concluded that the alleged loan commitment was unenforceable under Alabama's Statute of Frauds because the writings did not express consideration for the commitment. The opinion also addresses claims for fraudulent nondisclosure, negligent or wanton refusal to lend, and negligent or wanton supervision.

Holdings

1. The alleged agreement by AmSouth to lend ABS $5.2 million was void under Ala. Code 1975, § 8-9-2(7), because none of the writings in the record expressed consideration given or bargained for in exchange for AmSouth's commitment to lend.
2. AmSouth owed ABS no duty to disclose that the bank had not made a binding loan commitment, that ABS had not finally qualified for the loan, or that Marks lacked authority to approve it.
3. AmSouth and Marks owed ABS no contractual or common-law duty to lend money or to process the loan request in the manner ABS demanded; therefore, ABS's negligence and wantonness claims failed as a matter of law.
4. ABS failed to present substantial evidence that AmSouth knew or should have known of Marks's incompetence and negligently or wantonly disregarded it; summary judgment on the supervision claim was proper.

Questions Presented

1. Whether the evidence created a genuine issue of material fact concerning a binding loan agreement and breach of contract.
2. Whether the alleged loan commitment was unenforceable under Alabama's Statute of Frauds because no writing expressed consideration for the commitment.
3. Whether AmSouth owed ABS a duty to disclose that no binding loan agreement existed, that ABS had not finally qualified for the loan, or that Marks lacked authority to commit AmSouth.
4. Whether AmSouth or Marks owed ABS a duty of care to process the loan request, supporting negligence or wantonness claims.
5. Whether ABS presented substantial evidence that AmSouth negligently or wantonly supervised Marks.

Disposition

affirmed