The Georgia Supreme Court has further eroded the viability of the Georgia confirmation statute with its recent decision in York v. RES-GA LJY, LLC.1 In York, the Supreme Court affirmed the lower court’s application of last year’s PNC Bank2 decision to a guaranty’s boilerplate waiver clause that broadly waived “any and all rights or defenses based on suretyship or impairment of collateral, including, but not limited to, any rights or defenses arising by reason of . . . any ‘one action’ or ‘anti-deficiency’ law or any other law which may prevent Lender from bringing any action, including a claim for deficiency, against Guarantor, before or after Lender’s commencement or completion of any foreclosure sale action, either judicially or by exercise of a power of sale[.]”3
Specifically, the Supreme Court held that the defense offered by Georgia’s confirmation statute 4 is a defense “based on suretyship” and is expressly included in the waiver of rights and defenses under “one action” and “anti-deficiency” laws.5 Furthermore, the Supreme Court held that the denial of confirmation of the foreclosure sale was not a bar to the subsequent deficiency action, either under theories of collateral estoppel or election of remedies, because the guarantors had contractually waived any defense based on the failure to obtain confirmation.6 In dicta, the Court did not note, however, that factual findings in the order denying confirmation may be relevant to the calculation of damages in the deficiency action.7
Download the full article “Burr Alert: This Old Waiver? I’ve Had it for Years. Georgia Supreme Court Hold Guaranty’s Boilerplate Clause Waives the Requirements of State’s Confirmation Statute” by Erich N. Durlacher.