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In June 1995, Drywall, as the lessee, and Marchant
Corporation (Marchant), as the lessor, entered into a lease
agreement for certain industrial property (the lease). The
property was to be used by Drywall for manufacturing and
distribution purposes. The term of the lease was 3 years
beginning on August 1, 1995. Base rent, which increased from
year-to-year, was initially $4,998.30 per month. A $5,664.74
security deposit was due when the lease was signed but the
deposit was not made at that time. Petitioner and Mr. Schuster
signed the lease as officers of Drywall; neither signed the lease
in an individual capacity. Corwon J. Finley, petitioner's
personal friend and business associate, was a guarantor on the
lease, as was a corporation that he apparently controlled.
By checks dated June 20, 1995, drawn on her personal
checking account and made payable to Marchant, petitioner:
(1) Made the security deposit required under the lease; and (2)
paid the first month's rent, which was due August 1. The rent
check was for $5,255.71. The parties did not explain why the
amount was higher than required under the lease.
Soon after the lease was signed, Mr. Schuster decided that
he no longer wanted to be involved with Drywall. Petitioner
believed that she could not successfully operate Drywall without
Mr. Schuster and decided to abandon the project.
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Last modified: May 25, 2011