Wells Fargo Bank, N.A. v. BBGN, Inc. et al

Of note, the only fact listed as disputed by B. Schierhold is Well’s Fargo’s assertion that it performed “all” of its obligations under the account; B. Schierhold indicates she only signed an application that was subject to approval and that approval never occurred, but it was nevertheless a condition precedent to the loan. (Fact No. 1-8.)

The same set of facts are essentially reiterated by Wells Fargo as to the second loan except the loan number, dates, and amount due are changed. In particular, the last payment on the second

line of credit occurred on August 24, 2022, the account was closed on February 6, 2023, the balance owed is $29,975.85, and Barbra has not paid the debt despite signing the application and guaranty. (Fact No.’s 2-1 to 2-13.) In response, B. Schierhold only disputes the assertion that the application was an offer, indicates the document was not signed by BBGN, and Wells Fargo did not provide the customer agreement. (Response to Fact No. 2-6.)

Finally, Wells Fargo indicates it hired an attorney to prosecute the claims and that it is entitled to $2,778.25 in fees plus $45.78 in costs.

ANALYSIS The Evidentiary Objections Listing facts as “undisputed” in the opposing separate statement waives any objections to the evidence underlying those undisputed facts. (Hurley Const. Co. v. State Farm Fire & Cas. Co. (1992) 10 Cal.App.4th 533, 540-541.)

In this case B. Schierhold only lists three facts as disputed, namely, Fact No. 1-8 and 2-6, which relate to whether Wells Fargo performed “all” of its obligations, and the fact related to Wells Fargo’s purported entitlement to fees. However, Fact No.’s 1-8 and 2-6 are supported by, respectively, paragraphs 13 and 24 to the Greenwell declaration. The facts related to the fees is supported by the Ramirez-Browning declaration. In other words, almost all of the objections are asserted to evidence underlying the facts which B. Schierhold does not dispute (meaning the objections are waived) with the exception of the objection to paragraph 13 of the Greenwell declaration and the objections to paragraphs 7 and 19 to the Greenwell declaration (which are not even cited in the separate statement).

As to paragraphs 7 and 19 to the Greenwell declaration, they purport to authenticate the customer agreement and the fact that the application incorporates the customer agreement. In her opposing declaration, however, B. Schierhold herself authenticates the applications. (B. Schierhold Decl. at ¶¶ 2, 4, and 6.) A review of the applications confirms that the customer agreement is incorporated into the terms of the applications. (See Greenwell, Decl., Ex. 1 at p. 3 and Ex. 5 at p. 2, par. 1.)

The customer agreement itself (Greenwell Decl., Ex 2) is also properly authenticated via Greenwell’s custodian declaration. (See Unifund CCR, LLC v. Dear (2015) 243 Cal.App.4th Supp. 1, 6 [outlining the requirements of a custodian declaration] and Greenwell Decl. at ¶ 2.) The relevancy objections are also without merit since the documents support the claimed debt and the language of contractual documents is generally not hearsay. (See J&A Mash & Barrel, LLC v. Superior Court of Fresno County (2022) 74 Cal.App.5th 1, 19 [“documents containing operative facts, such as the words forming an agreement, are not hearsay”].)

Finally, as to paragraph 13 of the Greenwell declaration, it indicates Wells Fargo performed all of its obligations by extending credit and delivering statements, but those particular facts are not disputed; B. Schierhold appears to only dispute the “all” obligations language as opposed to disputing that credit had been extended or that statements had been provided. (See Response to Fact No.’s 1-8 and 2-6.) In this regard, the objection is partially waived, but the objection is otherwise overruled.

In sum, Defendant’s objections to paragraphs 7, 13, and 19 to the Greenwell declaration are overruled; the remainder of the objections are waived.

Claims for Breach of Personal Guarantee The elements of a claim for breach of contract are the “(1) the existence of the contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and (4) the resulting damages to the plaintiff.” (D’Arrigo Bros. of California v. United Farmworkers of America (2014) 224 Cal.App.4th 790, 800.) A personal guaranty is a contract and to prevail on a claim the plaintiff must show the existence of the guaranty, a default on the underlying obligation, and the guarantor’s failure to perform under the guaranty. (Gray1 CPB, LLC v. Kolokotronis (2011) 202 Cal.App.4th 480, 486.)

In this case, it is undisputed that BBGN and then B. Schierhold did not repay the debts. It is also undisputed that those failures resulted in the past due debt or the specified damages claimed as to both accounts. (Fact No.’s 1-7 to 1-14 and 2-7 to 2-13.) It is also undisputed that Wells Fargo performed under the agreement by extending the credit and providing account statements. (Fact No.’s 1-5, 1-6, 1-8, 2-4, 2-5, and 2-6.) B. Schierhold further concedes that BBGN submitted the first application, which she signed; that it promised to pay all monies advanced; and that in reliance upon the promises made and the terms and conditions in the application, Wells Fargo established the lines of credit. (Fact No.’s 1-1 to 1-6 and 2-1 to 2-5.) The applications also clearly contain personal guarantees. (Greenwell Ex. 1 at p. 3 [the personal guaranty]; Ex. 5 at p. 3 at par. 3.)

What B. Schierhold does dispute is whether Wells Fargo fully performed since she claims she was never provided with the customer agreement for purposes of the second account, the second application was not signed by BBGN, and the first application was never approved by Wells Fargo. (Response to Fact No. 2-6.) However, B. Schierhold concedes in her own declaration that she signed the second application. (B. Schierhold Decl. at ¶¶ 5-6 [B. Schierhold concedes that she signed both applications]; see also Fact No. 1-1 and 1-3 [B. Schierhold also concedes that she signed the first application].)

As for B. Schierhold’s contention that she was never provided with the customer agreement, that is immaterial since the plain language of the guaranties within the applications indicate she would be bound by its terms. (Greenwell Ex. 1 at p. 3 [the personal guaranty]; Ex. 5 at p. 3 at par. 3.) As the reply indicates, a party’s failure to read a contract before signing it is not grounds to refuse its enforcement. (Frame v. Merrill Lynch, Pierce, Fenner & Smith, Inc. (1971) 20 Cal.App.3d 668, 671; Larrus v. The First National Bank of San Mateo County (1954) 122 Cal. App.2d 884, 889-890 [“It is quite possible for a party to assent to be bound in accordance with terms of which he is then ignorant”].)

As for B. Schierhold’s argument that Wells Fargo never approved the applications and that the applications did not amount to a contract, the applications, if nothing else, could be seen as, effectively, offers from B. Schierhold to Wells Fargo, which in turn accepted the offers by issuing the lines of credit. Otherwise, the “applications” and customer agreement indicate use of the accounts are evidence of acceptance and agreement, including agreement to the applicable finance charges. It is undisputed that the credit lines were in fact used and account statements were then

provided, as noted above. Under either scenario two contracts exist because acceptance of an offer can be manifested by conduct, as occurred here, as well as by words. (Russell v. Union Oil Co. (1970) 7 Cal.App.3d 110, 114.) B. Schierhold also concedes that the documents indicated she would be personally bound “if [BBGN was] approved” for the credit line (B. Schierhold Decl. at ¶ 4.)

B. Schierhold further suggests that she was essentially unaware that there were two loans she applied for or which had been approved, but her ignorance is not objectively reasonable. B. Schierhold admits to signing two separate applications, with one having the handwritten “$200,000” language on it (Fact No. 1-3) and the second application she admits to knowing was for only $35,000 (B. Schierhold Decl. at ¶ 5).

Although the customer agreement indicates the credit limit of the accounts were to be as shown in separate correspondence provided and on each monthly statement issued for that account, that authorized users on the accounts could be changed, and that accounts could be terminated, there is no indication that B. Schierhold ever contacted Wells Fargo to withdraw any of the applications or cancel any of the credit lines, that she informed Wells Fargo she only wanted the one line of credit, that she contacted Wells Fargo to inform it she had left BBGN, that she sought clarification from Wells Fargo about anything, that she asked for account statements or other relevant documents to be sent to her directly after she left BBGN (and those documents apparently had two different account numbers listed), or that she did anything to ensure Wells Fargo would not issue two credit lines.

In fact, B. Schierhold apparently did not ask Glenn about the status of the first application when he presented the second to her for signature nor did B. Schierhold do anything to ensure she would stay informed about the status of the loans after leaving BBGN. That is significant because, as indicated above, she agreed to personally guarantee the loans and knew or should have known (because she agreed to as much) that mere use of the card by anyone on the account constituted acceptance. Instead of doing anything, B. Schierhold just assumed she was only approved for $35,000. Furthermore, B. Schierhold cites to no authority, and none is known, which holds that merely because spouses agree between themselves on how to divide liabilities upon divorce, that such an agreement undermines the creditor’s right or ability to pursue either or both spouses upon default.

B. Schierhold also argues that South Dakota law applies, but on the dispositive issues South Dakota Law is consistent with California law. (Scotland Vet Supply v. ABA Recovery Service, Inc. 1998 S.D. 103, ¶ 25 [contract not avoidable die to mistake of fact in execution of agreement because failure to read agreement is negligence]; Kernelburner, L.L.C. v. MitchHart Mfg., Inc. 2009 S.D. 33, ¶ 11 [“To permit a party, when sued on a written contract, to admit that he signed it but to deny that it expresses the agreement he made or to allow him to admit that he signed it but did not read it or know its stipulations would absolutely destroy the value of all contracts”]; Federal Land Bank of Omaha v. Houck (1942) 68 S.D. 449, 462 [“t is elementary that conduct may be as effective as words in manifesting mutual assent to a contract”].)

In the supplemental opposition, B. Schierhold further indicates that under South Dakota law, a personal guarantee is not binding until notice of its acceptance is communicated by the

guarantee to the guarantor, but as noted above acceptance was communicated since the lines of credit were initially extended, charges were made via the cards (which were issued), and account statements were periodically provided thereafter. B. Schierhold was apparently unaware of the details because she never asked and left BBGN “soon thereafter.” (B. Schierhold Decl. at ¶¶ 8-9.) B. Schierhold also does not address the customer agreement language indicating she agreed to be bound upon use of the card by anyone on the account.

Overall, the undisputed facts show the existence of two lines of credit/contracts, the personal guarantees, performance by Wells Fargo in issuing the cards and extending credit, default in payment, and damages. Therefore, the motion for summary adjudication as to the fourth and eighth causes of action for breach of personal guaranty for $103,849.54 and $29,975.85 is granted.

Fee Request While the damages arising from the breach of contract in this case are undisputed, the motion prematurely seeks attorney’s fees and costs. Civil Code section 1717 indicates that attorney’s fees and costs incurred to enforce a contract, where the contract specifically provides for attorney’s fees and costs to the prevailing party, shall be awarded to that prevailing party, but are awarded as fixed by the Court as an “element of the costs of suit.” The statute further indicates the Court affixes the amount “upon notice and motion.” (See also Cal. Rules Ct., Rule 3.1702 [noting that the motion is governed by the time to appeal deadline, which in turn is based upon the entry of judgment or the service of a notice of entry of judgment].) As a result, the request for attorney’s fees is premature and is therefore denied without prejudice.

Dated: July 22, 2026

____________________________ Judge Kory Mathewson

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