The Eleventh Circuit Court of Appeals recently held that a text message can constitute a personal guaranty on a debt. The Eleventh Circuit is the federal appeals court for Alabama, Georgia, and Florida. On October 13, 2022, it issued its opinion in Brewfab, LLC v. 3 Delta, Inc. 3 Delta hired BrewFab to build a machine for extracting cannabidiol oil. The agreement between the parties was an oral contract whereby BrewFab sent 3 Delta invoices for the work it performed. When those invoices stopped being paid, BrewFab stopped its work. After a telephone call where the parties discussed the outstanding invoices and the status of the agreement, a text message was sent by George Russo to a principal of Brewfab in which Russo stated “I [g]eorge Russo from 3 Delta do promise to pay brew fab in full all outstanding bills as of this date and all agreed upon work done for 3 delta future forward.” The Court found it was a personal guaranty. So when you text loved ones and friends this Christmas, make sure to review your text messages to avoid making any binding promises that can and will be used against you. Happy Holidays!
