BANK OF AMERICA, N.A. v. Constance H. BARR.
9 A.3d 816 (2010)
Supreme Judicial Court of Maine
Plaintiff: Bank of America
Defendant: Constance H. Barr
- Barr made an appeal against a ruling of the Superior Court in the County of Cumberland that found her guilty.
- The ruling acknowledged the Defendant’s personal liability to a debt accrued on a business line of credit to Stone Scone where she was a sole proprietor.
- Two years after approval and acquisition of line of credit from Fleet Bank, Stone Scone organized from a sole proprietorship to a limited liability company, with Barr named the Manager. Fleet Bank had also changed its status through a merger with Bank of America.
- No communication concerning the change of Stone Scone status was made nor a new line of credit made by Bank of America.
- Barr claims the Superior Court of Cumberland made an error of accepting some documents which contravened the provisions of the “exception to the hearsay rule, M.R. Evid. 803 (6) (Casenotes, 2010).
- Furthermore, Barr claimed insufficiency of the same records in supporting various important findings that were the basis of the judgment.
- Bank of America had prepared five claims against Barr, including breach of Fleet Bank’s line of credit, breach of Contract, unjust enrichment, legal fees and the breach of personal guarantee.
- The court ruled all but the second claim in favor of Barr. This is the breach of contract claim that led to this particular appeal.
The arising issue was whether Barr was responsible for the debt from a personal level with regards to his previous sole proprietorship status at Stone Scone. This was contentious, since the business was organized into a limited liability company by the time of the case.
The Supreme Court of Maine affirmed the Superior Court in the County of Cumberland.
Barr relied on admissibility of evidence based on what he claimed to be the lack of capacity of the witness who presented the same in the court on behalf of Bank of America. Barr questioned the witness’ capacity as not being directly involved in preparation of the documents, nor the credit line process. This could not hold, because the court found his professional capacity and experience sufficient to cover such provisions of the Evidence Rule 803(6) (Supreme Judicial Court of Maine, 2010).
Barr also put forth an argument about the insufficiency of the evidence. She claimed that Bank of America did not supply enough documents to ascertain existence of the contract or her personal liability for the credit line. This was also overruled due to the fact that a contract can also be implied through actions such as her monthly settlements for four years prior to the default, change of Fleet Bank ownership not stopping such monthly settlements, and being a sole proprietor carries all the business liabilities of Stone Scone into the limited liability company. Therefore, the court was right to affirm the previous ruling prior to this appeal.
Ignorance of the law has no defense. Based on the facts, Barr had indications of default due to her non-disclosure of the business status change. Furthermore, it is her responsibility to protect herself from accruing penalties or interest charges, unless negligence arises from the other party and she retained proof of communication. Whatever the circumstances, a contract always contains regulations or procedures to be observed under breaching considerations. I think, the Bank also made the case a little difficult by not using evidence that proves Barr received all or most of the communication in her personal capacity. Some of the best options should be express mail or courier delivery.
Casenotes (2010). Evidence: Keyed to courses using Waltz, Park, and Friedman’s evidence. New York: Aspen Law & Business.
Supreme Judicial Court of Maine. (2010). Bank of America, N.A. v. Barr. Leagle. Retrieved from: http://www.leagle.com/decision/In%20MECO%2020101130321/BANK%20OF%20AMERICA,%20N.A.%20v.%20BARR