## Facts

- Trustees of the L.T.D. Realty Trust purchased two condominium units for the trust and financed the purchase with two promissory notes payable to Dartmouth Savings Bank, secured by two mortgages.
- On each note, each trustee’s name was typewritten next to the preprinted term “Borrower,” and each signed and added “Trustee” after the signature.
- The notes stated they were secured by a mortgage, but did not identify the trust on their face.
- The mortgages executed in the same transaction identified the trust as the “Borrower.”
- After Dartmouth failed, Mundaca acquired the notes from the FDIC as receiver.
- Following default and foreclosure, Mundaca sued the trustees individually for the remaining deficiency on the notes.
- The trial court granted summary judgment for Mundaca, ruling the signature form did not unambiguously show representative capacity and that defendants failed to prove the bank did not intend personal liability.

## Issues

1. Whether the notes, read with the related mortgages, unambiguously showed the trustees signed only in a representative capacity under RSA 382-A:3-402(b)(1), precluding personal liability.
2. If the instruments were not unambiguous, whether conflicting evidence about the original parties’ intent created a genuine issue of material fact under RSA 382-A:3-402(b)(2), making summary judgment improper.

## Decision

- The Supreme Court of New Hampshire reversed the grant of summary judgment to Mundaca and remanded.
- The court held the record presented a genuine issue of material fact regarding whether the trustees signed only in a representative capacity and whether the original parties intended personal liability.
- The court noted the trial court had not addressed whether Mundaca was a holder in due course, a question that could affect the availability of intent-based defenses on remand.

## Legal Principles

- Under RSA 382-A:3-402(b)(1), a representative avoids personal liability only if the instrument names the represented person and the signature form unambiguously shows representative signing.
- Under RSA 382-A:3-402(b)(2), when the signature form does not satisfy (b)(1), the representative may avoid personal liability by proving the original parties did not intend personal liability.
- Transaction documents that are expressly linked (such as notes referring to mortgages as security) may be considered together when evaluating representative capacity and the parties’ intent.
- Summary judgment is improper where reasonable inferences and conflicting evidence on intent or capacity create a triable factual dispute.

## Conclusion

Because the notes’ relationship to mortgages identifying the trust as borrower, along with conflicting evidence about the parties’ intent, created factual disputes over representative capacity and personal liability under RSA 382-A:3-402, judgment for the noteholder as a matter of law was improper and the case required further proceedings.


Mundaca Inv. Corp. v. Febba, 727 A.2d 990 (N.H. 1999)