ORDER

KRISTI K. DuBOSE, District Judge.

This action is before the Court on the Motion for Summary Judgment against Defendant George W. Skipper, III ("Skipper") and supporting documents (Docs. 78-80) filed pursuant to Rule 56 of the Federal Rules of Civil Procedure by Plaintiff SE Property Holdings, LLC ("SEPH"), Skipper's Response and supporting documents in opposition (Doc. 101), and SEPH's Reply in support (Doc. 102).1 Upon consideration, and for the reasons set forth herein, the Court finds that SEPH's motion for summary judgment against Skipper is due to be GRANTED.

I. Procedural History

On May 3, 2012, SEPH initiated this action by filing a Complaint (Doc. 1) against Skipper and the other Defendants. The Complaint alleged breach of promissory notes by Defendant Sandy Creek II, LLC ("SC II") (identified as "Borrower" in the Complaint) (Count 1) and breach of guaranty agreements by all other Defendants (identified as "Guarantors" in the Complaint") (Count 2). SEPH also demanded that the Court order an accounting and inspection of certain financial transactions by the Defendants (Count 3).2 Skipper filed his Answer on June 28, 2012. (Doc. 32).

On April 2, 2013, SEPH filed its Motion for Summary Judgment against Skipper. (Doc. 78), moving for summary judgment in its favor on its breach-of-guaranty claim against him.3 Skipper filed his Response on May 1, 2013 (Doc. 101), and SEPH filed its Reply on May 9, 2013 (Doc. 102). The motion is now ripe for adjudication.4

II. Standard of Review

"The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). Rule 56(c) governs procedures and provides as follows:

Fed. R. Civ. P. 56(c).

A party seeking summary judgment bears the initial responsibility of informing the district court of the basis for its motion and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact. Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). The mere existence of a factual dispute will not automatically necessitate denial; rather, only factual disputes that are material preclude entry of summary judgment. Lofton v. Sec'y of Dep't of Children & Family Servs., 358 F.3d 804, 809 (11th Cir. 2004).

If a non-moving party fails to make a sufficient showing on an essential element of its case with respect to which it has the burden of proof, the moving party is entitled to summary judgment. Celotex, 477 U.S. at 323. In reviewing whether a non-moving party has met its burden, the Court must stop short of weighing the evidence and making credibility determinations of the truth of the matter. Instead, the evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in its favor. Tipton v. Bergrohr GMBH-Siegen, 965 F.2d 994, 998-99 (11th Cir. 1992) (internal citations and quotations omitted).

III. Facts

SEPH is the successor in merger for Vision Bank. (Doc. 79-1 at 1, ¶ 1 — Harmon Aff.; Doc. 98-1 (expressly incorporated in Reply, Doc. 102 at 5)). Vision Bank made two loans to SC II: 1) a $5 million loan to purchase real property ("property loan") (Doc. 101-33 — Skipper Ex. 33), which was executed on September 30, 2005, and matured on April 1, 2006, and 2) a $2 million loan to begin developing the property ("construction loan"), which was executed on October 13, 2006, and matured on April 1, 2007 (Docs. 101-11 & -12 — Skipper Exs. 10-11). (See also Doc. 101-2 — Braswell Depo.). In 2008, Vision Bank sold $4.5 million of the $5 million property loan to other banks pursuant to participation agreements. (Docs. 101-34 -38; 101-2 at 11, 46, 59-60). Both loans were secured by mortgages on the real property (Doc. 101-2 at 34-35) and were executed with SC II as the borrower. (Docs. 101-11 & -33). The property loan named Skipper as a guarantor (Doc. 101-33 at 1-2, ¶ 3), with Skipper executing a Continuing Guaranty in September 2005 (hereinafter, the "2005 Unlimited Guaranty") (Doc. 79-2 at 6-10). The construction loan also named Skipper as a guarantor, with Skipper executing a Limited Continuing Guaranty in October 2006 (hereinafter, the "2006 Limited Guaranty"). (Id. at 11-15).

The 2005 Unlimited Guaranty provides, in relevant part, as follows:

(Id. at 6-7).

The 2006 Limited Guaranty provides, in relevant part, as follows:

(Id. at 11-15).

Vision Bank never communicated directly with Skipper, instead delegating the task of preparing and executing the guaranties to its attorneys. (Doc. 101-2 at 7-8, 80-83, 93 — Braswell Depo.). Vision Bank's attorneys sent the guaranties to Joe Raley Builders, developer of the Sandy Creek project; an employee of the company, Barbara Merryman ("Merryman"), was then instructed by Joe Raley ("Raley") to obtain signatures from Skipper and the other guarantors. (Doc. 101-4 at 2, 14 — Raley Depo.).

Both loans were renewed or modified multiple times over the years — the property loan in April 2006; both loans in April 2007, April/May 2008, and July 2008. Each renewal or modification was made without obtaining guarantor approval. During the 2008 loan renewals, Vision Bank was aware that sales for the Sandy Creek development were slow, that development itself was not going as planned, and that the real estate market in general was falling. Vision Bank also obtained several appraisals of the collateral property — July 2005 ($9.84 million), August 2008 ($5.5 million), June 2009 ($4.25 million), September 2009 ($2,786,800) (obtained by participating bank), October 2011 ($1.07 million). (Doc. 101-2 — Braswell Depo; Docs. 101-46 -51). Skipper claims he was never informed of these appraisals.

In July 2009, Skipper signed a "Supplement to Loan Documents" relating to the two loans, which stated in relevant part: "Borrower and all of the Included Guarantors acknowledge and agree that . . . the Loans and First Note and Second Note have matured and are in default and are due and payable in full . . ." (Doc. 79-2 at 1-4). That same month, SC II executed two Amended Promissory Notes in favor of Vision Bank (these are the notes on which SEPH bases its breach-of-contract claims): one for the principal amount of $3,521,057.89 ("amended property loan") (Doc. 79-1 at 5-7) and the other for the principal amount of $1,999,645.83 ("amended construction loan") (id. at 8-10). As with the original loans, Skipper was named as a guarantor for both amended loans. New guaranties were not executed for either of the Amended Promissory Notes.

The Amended Promissory Notes are in default, and all Defendants have refused SEPH's demand for payment. (Doc. 79-1 at 2, ¶¶ 6-7 — Harmon Aff.). SEPH claims that, as of January 9, 2013, the balance due under the amended property loan is $2,827,827.01 ($2,657,442.18 in principal and $170,384.83 in interest, with interest continuing to accrue "at a default rate of Wall Street Prime plus 4.5%, currently 8% ($590.54 per diem)" ), and that the balance due under the amended construction loan is $2,099,379.07 ($1,859,429.94 in principal and $239,949.13 in interest, with interest continuing to accrue "at a default rate of Wall Street Prime plus 4.5%, currently 8% ($413.21 per diem)"). SEPH claims that Skipper is liable for the full amount due on the amended property loan, under the terms of the relevant Amended Promissory note and the 2005 Unlimited Guaranty (id., ¶ 8), and that he is liable for $839,949.13 of principal and accrued interest pursuant to the terms of the 2006 Limited Guaranty (id. at 3, ¶ 9).

To date, SEPH has not foreclosed on the collateral real property.

IV. Analysis

a. Applicable Law

Before addressing the parties' substantive contentions, the Court must decide what law governs the claims in this diversity action. The claims in this action are based on contract law. "[A] federal court in a diversity case is required to apply the laws, including principles of conflict of laws, of the state in which the federal court sits." Manuel v. Convergys Corp., 430 F.3d 1132, 1139 (11th Cir. 2005) (citing Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496 (1941)). Alabama courts follow the traditional conflict-of-law principle of lex loci contractus. Lifestar Response of Ala., Inc. v. Admiral Ins. Co., 17 So.3d 200, 213 (Ala. 2009). Accordingly, in Alabama, contract claims are governed by the laws of the state where the contract was made, unless the contracting parties chose a particular state's laws to govern their agreement. E.g., Cherry, Bekaert & Holland v. Brown, 582 So.2d 502, 506 (Ala. 1991). In this action, all loan documents at issue expressly provide that they are to be governed by the laws of Alabama, and no party has argued that the law of any other jurisdiction should apply. Therefore, the Court will apply Alabama law to the claims in this action.

b. Arguments

In the Complaint, SEPH alleges that it "is the holder of the Notes and each Guaranty[,]" that Skipper is "in default under the Notes and Guaranties[,]" and that it has "demanded payment from" Skipper, who has "failed to pay." (Doc. 1 at 4-5, ¶¶ 15, 17, 19). Under Alabama law, " `[e]very suit on a guaranty agreement requires proof of the existence of the guaranty contract, default on the underlying contract by the debtor, and nonpayment of the amount due from the guarantor under the terms of the guaranty.'" Sharer v. Bend Millwork Sys., Inc., 600 So.2d 223, 225-26 (Ala. 1992) (quoting Delro Indus., Inc. v. Evans, 514 So.2d 976, 979 (Ala. 1987)).5 " `Rules governing the interpretation and construction of contracts are applicable in resolving a question as to the interpretation or construction of a guaranty contract.'" Eagerton v. Vision Bank, 99 So.3d 299, 304 (Ala. 2012) (quoting Gov't St. Lumber Co. v. AmSouth Bank, 553 So.2d 68, 75 (Ala. 1989)).

SEPH argues that it is due summary judgment in its favor on its breach-of-guaranty claims against Skipper based on the express, binding, and enforceable terms of the Amended Promissory Notes, the 2005 Unlimited Guaranty, and the 2006 Limited Guaranty, and because Skipper has "expressly acknowledged" that he is in default on the guaranties (Doc. 79 at 5, ¶ 5).

Upon consideration of the evidence presented, the Court finds that SEPH has met its initial burden of establishing that the loans are in default, in that Skipper "agrees that he signed or executed loan documents and that the notes associated with these loan documents are in default, but [he] cannot agree or dispute the amounts claimed by SEPH." (Doc. 101 at 9. See also Doc. 101-1 at 14-15 — Skipper Depo.).

However, Skipper claims genuine issues of material fact as to whether he is discharged from his obligations under the guaranties due to material alterations made and caused by Vision Bank without his consent — specifically, by Vision Bank's several renewals of the loans without informing Skipper that the value of the collateral property had dropped. Skipper also claims genuine issues of material fact as to whether he is subject to the 2005 Unlimited Guaranty, arguing that, by its express language, the 2006 Limited Guaranty modified the 2005 Unlimited Guaranty such that Skipper's payment obligation on both loans is limited to that set forth in the limited guaranty ($600,000). Finally, Skipper argues that, even if he is liable to SEPH under the guaranties, 1) he is due a setoff on any amount owed because SEPH failed to act in a commercially reasonable manner by not foreclosing on the collateral real property, and 2) SEPH has not presented sufficient evidence to justify either its entitlement to collect on the guaranties.

i. Material Alterations to Guaranties

Both loans at issue were secured by a mortgage on real property. According to Skipper's factual narrative, at the time the property loan was executed, the collateral real property was appraised at $9.84 million, thus making the $5 million property loan "double collateralized." Both loans were renewed several times over the years — in April 2006, late April/early May 2008, July 2008, August/September 2008, and July 2009 (when the Amended Promissory Notes on which SEPH relies in its Motion for Summary Judgment were executed). Each of these renewals, according to Skipper, was carried out without obtaining the consent of the guarantors and in spite of Vision Bank's knowledge that lot sales and development at the Sandy Creek project were slow and that the overall real-estate market was in decline. Moreover, Vision Bank obtained new appraisals of the collateral property prior to the August/September 2008 and July 2009 renewals showing that the value of the collateral had dropped, first to $5.5 million and then to $3.95 million. (Doc. 101 at 3-5, ¶¶ 5, 10).

Skipper has cited Eagerton v. Vision Bank, 99 So.3d 299 (Ala. 2012), reh'g denied, (June 29, 2012), in support of his contention that material changes have rendered the guaranties unenforceable. In that case, the Alabama Supreme Court stated as follows with regard to guaranty contracts:

Eagerton, 99 So. 3d at 305-06.

Skipper contends there is a genuine issue of material fact as to whether the several loan renewals by Vision Bank "constituted material changes to the loan agreements and guaranties because of the drastic drop in the value of the collateral securing the Sandy Creek loan." Should these renewals constitute material changes, the guaranties would be unenforceable "[b]ecause Vision Bank did not obtain consent agreements from [Skipper] affirming the guaranties . . . " (Doc. 101 at 13).

SEPH argues that Eagerton is distinguishable from the present case and that the terms of the guaranties in this case make any drop in the value of the loan collateral irrelevant to their enforceability. The Court agrees. Eagerton also involved guaranties related to two loans, "the original loan" and "the second loan." Whereas other guarantors had executed "unlimited" guaranties with regard to the two loans, "[o]n each of their guaranty contracts, [Appellants ]the Eagertons . . . limited their liability to `indebtedness' arising out of . . . the original loan, as well as any `extensions, renewals or replacements thereof.'" 99 So. 3d at 305. With the participation of the lender, but not the Eagertons, the original loan was later consolidated with the second loan in a Chapter 11 bankruptcy proceeding, and the lender sought payment from the Eagertons on the consolidated loan pursuant to their guaranty contracts. Id. at 302-03. The Alabama Supreme Court, however, agreed with the Eagertons' argument that "the consolidation of the original loan with the second loan[] created a new `indebtedness' and/or contract not encompassed by their guaranty contracts" and "that the creation of this new indebtedness, without their knowledge or consent, operated to discharge them from any further obligations under their guaranty contracts." Id. at 306. Specifically, the court found that the bankruptcy loan consolidation constituted a "modification," rather than an "extension[], renewal[] or replacement[,]" of the original loan. As the Eagertons "did not guarantee . . . the original loan[] `with modifications[,]' . . . once the original loan was modified pursuant to [the] Chapter 11 reorganization, the Eagertons were discharged from any further obligations under their guaranty contracts securing the original loan." Id. at 307.

In this case, no "new indebtedness" was created by the repeated renewal of the loans. The decline in value of the collateral property had no effect on the indebtedness owed by Skipper. As the express terms of the guaranties provide, SEPH is under no obligation to use the collateral property to satisfy the loans before seeking payment from the guarantors. Both the 2005 Unlimited Guaranty and 2006 Limited Guaranty state: "It is the intent hereof that the obligations of the Guarantor hereunder shall be and remain unaffected (a) by the existence or non-existence, validity or invalidity of any pledge, assignment or conveyance given as security . . ." (Doc. 79-2 at 7, ¶ 4, 12, ¶ 4). Moreover, in executing the guaranties, Skipper expressly 1) "authorize[d] [Vision ]Bank, without notice or demand and without affecting his liability hereunder, from time to time to . . . (b) take and hold security for the payment of the Guaranty or the Indebtedness guaranteed, and exchange, modify, enforce, waive and release any such security. . ." (id. at 7, ¶ 5, 12, ¶ 5 (emphasis added)), and 2) "waive[d] any right to require Bank to . . . (b) proceed against or exhaust any security held from Borrower . . ." (id. at 7, ¶ 6, 12, ¶ 6).

Under these terms, regardless of whether the collateral property increases or decreases in value, SEPH is entitled to forego foreclosure on the collateral and instead seek full payment on the loans from Skipper. As such, "the liability of [the] guarantor[s] [has] not be[en] extended by implication beyond the terms of [their] contracts" by the changing value of the collateral property. Eagerton, 99 So. 3d at 306 (quotation omitted). See also John Glenn et al., 38A C.J.S. Guaranty § 97 (2013) ("Whether an alteration in a guaranty contract is material depends upon whether after the alteration it expresses the same contract, and whether it will have the same operation and effect. If the alteration in a guaranty changes the guarantor's liability it is material.. . . It has been said that an alteration of a guaranty agreement is not `material,' as basis for discharging the guarantor, unless the guarantor is placed in the position of being required to do more than his or her original undertaking." (footnotes omitted)). Therefore, Skipper has failed to demonstrate material alterations to the guaranties.

ii. 2006 Limited Guaranty Modifies 2005 Unlimited Guaranty

Even if the guaranties are enforceable, Skipper argues that he is liable only for the amount provided for in the 2006 Limited Guaranty, which by its "plain language . . . supercedes" the 2005 Unlimited Guaranty "by limiting the obligations of Skipper on both loans to a specified principal amount." (Doc. 101 at 14).

In Alabama, "[p]arties may modify the terms of their agreement and `if the terms of a subsequent agreement contradict the earlier agreement, the terms of the later agreement prevail.'" McLemore v. Hyundai Motor Mfg. Ala., LLC, 7 So.3d 318, 332-33 (Ala. 2008) (quoting Cavalier Mfg., Inc. v. Clarke, 862 So.2d 634, 641 (Ala. 2003) (plurality opinion)). See also RRE Crestwood Holding, LLC v. CV Apartments, LLC, No. 2:11-CV-01466-AKK, 2012 WL 3139588, at *4 (N.D. Ala. July 26, 2012) ("[W]hen `two agreements cover the same subject matter and include inconsistent terms, the later agreement supersedes the earlier agreement.'" (quoting Cavalier Mfg., 862 So. 2d at 641) (plurality opinion) (emphasis added) (quoting for proposition CMI Int'l, Inc. v. Intermet Int'l Corp., 251 Mich.App. 125, 130, 649 N.W.2d 808, 812 (2002))). "Both parties must mutually assent to a modification." Ex parte Amoco Fabrics & Fiber Co., 729 So.2d 336, 340 (Ala. 1998). See also Whorton v. Bruce, 17 So.3d 661, 665 (Ala. Civ. App. 2009) ("`[I]t is an elementary principle of contract law that in order for a contract to be validly modified, there must be mutual assent to the new terms by both parties. . . . It is incumbent on the party claiming the modification to show that the new agreement was mutually agreed to.'" (quoting Wiregrass Constr. Co. v. Tallapoosa River Elec. Coop., Inc., 365 So.2d 95, 98 (Ala. Civ. App. 1978))). Though Skipper spends significant page space arguing ambiguity in support of his contention that the 2006 Limited Guaranty supersedes the 2005 Unlimited Guaranty, "`[i]t is a general rule that a party claiming that a contract modifies a prior contract must show that the later contract is definite and certain as to the terms of modification, and the modification extends only so far as the terms are definite, certain and intentional.'" McLemore, 7 So. 3d at 333 (quoting Johnson-Rast & Hays, Inc. v. Cole, 310 So.2d 885, 889 (Ala. 1975) (citing 17 C.J.S. Contracts § 347, p. 424)).

In both the 2005 Unlimited Guaranty and the 2006 Limited Guaranty, Skipper "unconditionally guarantees and promises to pay to VISION BANK . . . or order, on demand, in lawful money of the United States, any and all Indebtedness, as hereinafter defined, of SANDY CREEK II, LLC . . . to Bank." As Skipper points out, "Indebtedness" as defined in the 2006 Limited Guaranty is very broad and can be read to encompass the property loan as well as the construction loan, especially when compared with the more confined definition of "Indebtedness" contained in the 2005 Unlimited Guaranty.

"Indebtedness" in the 2005 Unlimited Guaranty specifically "pertain[s] to" the $5 million property loan and "includes any and all advances, debts, obligations and liabilities of [SC II] to [Vision ]Bank heretofore, now, or hereafter existing, made, incurred, or created, . . . arising under, pursuant to or in connection with" the $5 million property loan. In contrast, "Indebtedness" in the 2006 Limited Guaranty "includes" the construction loan as well as "any and all advances, debts, obligations and liabilities of [SC II] to [Vision ]Bank heretofore, now, or hereafter existing, made, incurred, or created, . . . whether or not arising under, pursuant to or in connection with" the construction loan. The 2005 property loan can be considered an "advance[], debt[], obligation[] [or] liability[y] of [SC II] to [Vision ]Bank heretofore . . . made, incurred, or created, . . . not arising under, pursuant to or in connection with" the construction loan. As such, the 2006 Limited Guaranty could be read to modify the terms of the 2005 Unlimited Guaranty by limiting Skipper's liability for "any and all Indebtedness" of SC II to Vision Bank "heretofore . . . or hereafter existing, made, incurred, or created," including the original property loan and the amended property loan.

SEPH "assum[es] arguendo that the language in the 2006 limited guaranty [is] broad enough to overlap with the underlying debt covered by the 2005 guaranty" but argues that "[t]here is nothing in the 2006 guaranty that purports to revoke or supplant the 2005 unlimited guaranty of" the property loan. In support, SEPH cites Ferguson v. Cadle Co., 816 So.2d 473, 476 (Ala. 2001), in which it claims "the Supreme Court of Alabama has expressly held that a later `guaranty cannot, in and of itself, negate the earlier guaranty.'" That holding, however, does not have the broad application SEPH argues; it is instead limited to the specific facts of that case, where the earlier guaranty contained express language stating that "the only way to revoke that guaranty [wa]s by written notice actually received by the Bank." Ferguson, 816 So. 2d at 476 (quotation marks omitted). Because the record in Ferguson contained no evidence of such a condition being met, the court found that the later guaranty did not revoke or replace the earlier one. This result is consistent with the Alabama Supreme Court's holding that "a provision in a continuing guaranty agreement that requires a particular method of revocation must be given effect as written . . ." Barnett Millworks, Inc. v. Guthrie, 974 So.2d 952, 957 (Ala. 2007). SEPH does not point to any such provision in any of the guaranties at issue. The other cases to which SEPH cites in support of this contention are not relevant, as they do not address contract modification under Alabama law. See Alton Banking & Trust Co. v. Schweitzer, 121 Ill.App.3d 629, 634 (1984) (rejecting theories of merger and novation under Illinois law in finding that a later guaranty did not replace a previous one); RRE Crestwood, 2012 WL 3139588, at *4 (finding that Alabama merger doctrine did not apply to three guaranties because each related to a different obligation).

However, "[t]erms of a written instrument should be construed in pari materia and a construction adopted that gives effect to all terms used." Sullivan, Long & Hagerty v. S. Elec. Generating Co., 667 So.2d 722, 725 (Ala. 1995). A review of the document indicates that the express terms of the 2006 Limited Guaranty do not allow for modification of Skipper's liability in the 2005 Unlimited Guaranty. Specifically, paragraph 15 of the 2006 Limited Guaranty provides: "No provision of this Guaranty shall be deemed in conflict with . . . any other Loan Document, and the Guarantor acknowledges that no such provision or any interpretation thereof shall be deemed to diminish the rights of the Bank under the terms and conditions of any other provisions . . . thereof." (Doc. 79-2 at 14-15 (emphasis added)). The term "Loan Documents," as set out in paragraph 1 of the 2006 Limited Guaranty, refers to, inter alia, "all other documents and instruments related to the Note and/or any of the indebtedness and obligations at any time arising thereunder or the security therefor, and including, without limitation to the generality of the foregoing, a Mortgage and Security Agreement from Borrower to Bank dated on or about September 30, 2005, as modified by instrument between Borrower and Bank to be dated the date of the Note, as the said documents and instruments may from time to time be amended, restated, extended and/or consolidated." (Id. at 11 (emphasis added)).

The Amended Promissory Note for the 2005 property loan states that its indebtedness is secured by a "certain Mortgage and Security Agreement . . . dated on or about September 30, 2005, from Borrower to Bank . . ." (Doc. 79-1 at 5-6, ¶ 3). It also states that it "has been guarantied by [Skipper and others] pursuant to separate continuing guaranties heretofore executed by said Guarantors . . ." (Id. at 5, ¶ 3). As such, the 2005 Unlimited Guaranty can plainly be considered a "document[] or instrument[] related to . . . [the] Mortgage and Security Agreement from Borrower to Bank dated on or about September 30, 2005," supra, and is therefore a "Loan Document" under the 2006 Limited Guaranty. Because the provisions of any such "Loan Document" cannot be "deemed in conflict with" the provisions of the 2006 Limited Guaranty, nor can the provisions of the 2006 Limited Guaranty be read to "diminish the rights of" SEPH under any "Loan Document," supra, the terms of the 2006 Limited Guaranty do not "contradict," and therefore do not modify or supercede, the terms of the 2005 Unlimited Guaranty, see McLemore, 7 So. 3d at 332-33.

iii. Commercially Unreasonable Behavior

Skipper also argues that SEPH is not entitled to recover the full amount due on the loans because it (and Vision Bank) acted in a commercially unreasonable manner by failing to foreclose on the collateral property, even though it was aware that the property's value was declining. Alabama law states: "Every aspect of a disposition of collateral, including the method, manner, time, place, and other terms, must be commercially reasonable." Ala. Code § 7-9A-610(b). However, "a secured party's failure to have conducted a sale or disposition of collateral in a commercially reasonable manner does not absolutely bar the secured party from recovering the deficiency between the amount due on the secured debt and the proceeds of the sale or disposition of the collateral. Rather, the debtor is entitled to set off any loss proven at trial against the deficiency owed to a secured party." Folks v. Tuscaloosa Cnty. Credit Union, 989 So.2d 531, 535 (Ala. Civ. App. 2007) (citing Stone v. Cloverleaf Lincoln-Mercury, Inc., 546 So.2d 388, 390 (Ala. 1989)). See also Abston v. Cent. Bank of the S., 492 So.2d 1298, 1300 (Ala. 1986) ("[A] debtor may be entitled to a reduction in the amount of a deficiency remaining after the sale of collateral as damages for a creditor's commercially unreasonable behavior in the sale of repossessed collateral." (citing Valley Mining Corp., Inc. v. Metro Bank, 383 So.2d 158 (Ala. 1980)).

Skipper has cited no Alabama case law applying this concept either to real property collateral or to behavior occurring outside the actual "sale or disposition of collateral," and the Court's own research has uncovered none. As has been discussed supra, Skipper expressly waived any requirement of SEPH to foreclose on the collateral property. Moreover,

Whitney Bank v. Point Clear Dev., LLC, Civ. A. No. 11-0657-WS-M, 2012 WL 2277597, at *5 (S.D. Ala. June 18, 2012) (Steele, C.J.) (emphasis added).

As such, Skipper's argument that he is due a set off for commercially unreasonable behavior is without merit.

iv. Entitlement to Collect on the Loans

Skipper argues that SEPH "fail[s] to present sufficient undisputed facts in support of [its] claims — particularly in regards to damages and whether SEPH has the contractual authority or standing to pursue the breach of contract claims." (Doc. 101 at 20-21). First, he points to testimony of Alexander Braswell, SEPH's corporate representative under Rule 30(b)(6) of the Federal Rules of Civil Procedure, stating that Vision Bank sold $4.5 million of the $5 million property loan to participating banks, retaining $500,000 (10%) of the original principal. Pursuant to this testimony, Skipper argues that "SEPH has presented no evidence to the Court as to its legal entitlement to recover damages on the debt which SEPH (or its purported predecessor in interest, Vision Bank) has actually recovered long ago from the sale thereof to participating banks[,]" claiming that the 2005 Unlimited Guaranty is "wholly silent as to the existence of participating banks and the rights of Vision Bank (or SEPH) to recover principal sold to participating banks from guarantors." (Id. at 21). In response, SEPH asserts:

(Doc. 102 at 8).

Notwithstanding these assertions, the loan participation agreements for the property loan each provide: "Originating Bank [Vision Bank] shall, subject to the provisions of this Agreement, retain all rights with respect to enforcement, collection, and administration of the Loan and the security underlying the Loan therefore, in accordance with the terms of this Agreement." (Docs. 101-34 - 101-38, ¶ 16.c.). Skipper has not identified any language in the participation agreements that would otherwise limit SEPH's right to claim the full amount owed on the property loan.

Skipper also argues that SEPH has failed to show that it has been assigned or otherwise "stepped into the shoes" of Vision Bank in relation to the guaranties or that it is otherwise the successor in interest to those rights. However, SEPH has presented 1) the affidavit of Karen Harmon, assistant secretary of SEPH, who states that SEPH is the "successor in merger for Vision Bank" (Doc. 79-1 at 1, ¶ 1), and 2) a certified copy of the "Certification of Merger and Transfer" between Vision Bank and SEPH (Doc. 98-1). Skipper merely faults Harmon's affidavit statement for being "conclusory," and he has not moved to strike or otherwise challenge the Certification of Merger and Transfer. The Court finds that either of these pieces of evidence is sufficient to prove the point asserted — that SEPH is the successor in merger of Vision Bank and that Skipper has presented insufficient evidence to create an issue of fact. Under Alabama law, "all rights, immunities, and franchises of the merged entities, of a public as well as a private nature; and all debts and obligations due the merged entities, are taken and deemed to be transferred and vested in the surviving or resulting entity without the necessity of any deed or other instrument of conveyance to the surviving or resulting entity . . ." Ala. Code § 10A-1-8.02(i)(2). Thus, the Court finds there is no genuine issue of material fact as to SEPH's entitlement to enforce the loans made by Vision Bank in this case.

V. Conclusion

In accordance with the foregoing analysis, it is ORDERED that Plaintiff SEPH's Motion for Summary Judgment against Defendant George W. Skipper, III (Doc. 78) is GRANTED.6

DONE and ORDERED.