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risk. Gelt executed certain promissory notes at closing, which
were renewed later. Sack was not a party to the notes. The
holder of the notes subsequently sued Gelt to recover the unpaid
balance. Gelt contended he was an accommodation maker of the
notes and, for that reason, was not liable to Pioneer on the
renewal note.
The Court of Appeals for the Eighth Circuit found that both
the original note and the renewal note were executed by Gelt, as
maker, and the respective payees. There were no other parties to
the instruments. The court held that Gelt was not an
accommodation party under Nebraska law because he “did not ‘lend
his name’ to any other parties to the instrument”. Id. at 1311.
The court noted that “While there is no doubt that Gelt executed
the instruments as an accommodation to Sack, that did not make
him an ‘accommodation party’ within the meaning of [Neb. Rev.
Stat. U.C.C. sec.] 3-415(1) and (5).” Id.
In this case, Henry and Esther were the only obligors under
the FirsTier note and the first five extensions or modifications
of that note. This fact is consistent with other evidence in the
record that overwhelmingly establishes the parties intended for
Henry and Esther to be the primary obligors on the FirsTier note.
See Ashland State Bank v. Elkhorn Racquetball, Inc., supra at
194; Marvin E. Jewell & Co. v. Thomas, supra at 534.
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