Branch Banking & Trust Company v. Nichols

Appellants Branch Banking & Trust Company ("BB&T"), Rusty Winfree, and Todd Fullington appealed a circuit court judgment entered in favor of Rex Nichols ("Sonny") and Claudene Nichols on the Nicholses' claims against appellants and on BB&T's counterclaim against the Nicholses. In late 2005, Sonny began talking to Winfree about obtaining financing from Colonial Bank ("Colonial"), Winfree's employer, for the purchase of approximately 500 acres of real property in Stapleton, Alabama. The Nicholses intended to develop the Stapleton property into a subdivision. In February 2006, the Nicholses executed a loan agreement with Colonial, in which Colonial agreed to lend the Nicholses close to $2.8 million to purchase the property. Sonny testified that in late 2007, as the maturity date on the note approached, he began contacting Colonial regarding renewing the loan; he further testified that, around the same time, Winfree became slow to communicate with him. Sonny also testified that before the February 27, 2008, maturity date on the promissory note, he spoke to Fullington about renewing the loan, with Colonial carrying the interest going forward. A few weeks later, the Nicholses were notified that Colonial would not carry the interest on the loan or provide additional funds for development of the property. Colonial ultimately renewed the terms of the note until Colonial failed in August 2009. The FDIC assumed control of its assets and liabilities. The FDIC sold many of Colonial's assets and liabilities to BB&T, including the Nicholses' loan. Fullington was hired by BB&T; Winfree was not. In early November 2009, BB&T informed the Nicholses that it would not lend them additional funds to develop the property. The Nicholses stopped making interest payments on the loan in November 2009. On March 10, 2010, the Nicholses sued the appellants and fictitiously named defendants, alleging fraud, reformation, negligence, wantonness, and breach of fiduciary duty against all appellants. Against BB&T, the Nicholses also alleged a claim of unjust enrichment and sought damages on a theory of promissory estoppel. The appellants separately moved the circuit court to dismiss the complaint pursuant to Rule 12(b)(6), Ala. R. Civ. P. BB&T also filed a counterclaim, alleging that the Nicholses had defaulted on their obligations under a June 2009 promissory note and seeking damages related to that default. The circuit court denied the motions to dismiss the complaint but granted a motion to strike the request for a jury trial. Upon review, the Supreme Court held that the circuit court erred in entering a judgment in favor of the Nicholses on their claims against the appellants and on BB&T's counterclaim against them. The judgment was reversed and the case remanded with instructions to the circuit court to enter a judgment in favor of the appellants on the Nicholses' claims against them and in favor of BB&T on its counterclaim against the Nicholses and to determine the damages to be awarded on the counterclaim. View "Branch Banking & Trust Company v. Nichols" on Justia Law