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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link="#0563C1" vlink="#954F72"><div class=WordSection1><p class=MsoNormal>Listmates,<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal>Entity takes out a loan secured by real property and personal property. The loan was personally guaranteed by a sister-company (“Guarantor”) of the borrower. The Guaranty states that the Guarantor, “absolutely and unconditionally jointly and severally guarantees prompt payment of and promises to pay or cause to be paid to the Bank the Obligations… whether or not the Obligations are valid and enforceable against the Borrower, whenever the Obligations become due, whether on demand, at maturity or by reason of acceleration, or at the time the Borrower of the Guarantor shall become the subject of any bankruptcy or insolvency proceeding.”<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal>Client had a contract for services with a perfected security interest in the personal property. Borrower-entity is dissolved and Guarantor pays off the debt. Guarantor asserts that because it paid off the underlying debt it is subrogated to the lender’s first position security interest in the assets, essentially jumping Client’s security interest.<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal>The fact that the Guarantor is “absolutely and unconditionally jointly and severally” gives me pause. The logic of a subsequent creditor, the Guarantor, stepping into the shoes of a priority creditor doesn’t seem to fit someone that is already liable for the initial debt. Does the Guarantor get the benefit and preferred treatment of stepping into the lender’s shoes because it paid off the debt when the Guarantor was absolutely and unconditionally jointly and severally liable for the debt already?<o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'><o:p> </o:p></span></b></p><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'>Samuel M. Meyler</span></b><o:p></o:p></p><p class=MsoNormalCxSpMiddle style='margin-bottom:12.0pt;mso-add-space:auto'><b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'>Meyler Legal, PLLC </span></b><o:p></o:p></p><p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'>1700 Westlake Ave. N., Ste. 200<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'>Seattle, Washington 98109</span><o:p></o:p></p><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'>Tel:</span></b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'> 206.876.7770<o:p></o:p></span></p><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'>Fax:</span></b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'> 206.876.7771<o:p></o:p></span></p><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'>Email:</span></b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'> </span><a href="mailto:samuel@meylerlegal.com"><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'>samuel@meylerlegal.com</span></a><o:p></o:p></p><p class=MsoNormal><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'> </span><o:p></o:p></p><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Arial",sans-serif;color:blue'>NOTICE:</span></b><o:p></o:p></p><p class=MsoNormal><span style='font-size:8.0pt;font-family:"Arial",sans-serif;color:blue'> </span><o:p></o:p></p><p class=MsoNormal><span style='font-size:8.0pt;font-family:"Arial",sans-serif;color:blue'>This electronic message contains information which may be Confidential or Privileged and constitutes an electronic communication within the meaning of the Electronic Communications Privacy Act 18 USC 2510. The information is intended to be for the use of the individual or entity named above. If you are not the intended recipient, please be aware that any disclosure, copying, distribution or use of the contents of this information is prohibited. If you received this transmission in error, please notify the sender and delete the copy you received together with any attachments. Thank you.</span><o:p></o:p></p><p class=MsoNormal><o:p> </o:p></p></div></body></html>