RNR Investments Limited Partnership v. People’s First Community Bank
District Court of Appeal of Florida, First District
812 So.2d 561 (2002)
RNR Investments Limited Partnership (RNR) (defendant) was created to purchase and develop a parcel of land. RNR’s written partnership agreement restricted general partner Bernard Roeger’s capacity to commit the partnership to expenses beyond what was approved in the budget. Specifically, Roeger was prohibited from exceeding the budget by more than ten percent for any line item, without the prior written consent of the limited partners. Roeger obtained the approval of the limited partners to seek $650,000 in financing for construction. Without consulting the limited partners, Roeger entered into a construction loan agreement and mortgage with People’s First Community Bank (Bank) (plaintiff) in the amount of $990,000. Bank had no knowledge of the partnership agreement’s restrictions. RNR defaulted on the loan, and Bank sued RNR in foreclosure. The trial court granted summary judgment to Bank, rejecting RNR’s arguments that Bank had a duty to discover the limitations on Roeger’s authority.
Rule of Law
Holding and Reasoning (Van Nortwick, J.)
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