Personal guarantees: Clients ask their customers to sign
them; clients are asked to sign them by their vendors. In most
cases, not much thought is given to the structure or language of
the personal guaranty. A recent Massachusetts decision, however,
highlights the possibility that personal guarantees may be subject
to attack if they are not structured appropriately.
In Yellow Book, Inc. v. Tocci (2014 Mass. App.
Div. 20), the Massachusetts district court
appellate division held that personal liability would not be
imposed upon the signer of an advertising contract even though the
form of contract used by the vendor, Yellow Book, included clear
language as to a guaranty. Yellow Book had entered into a series of
advertising contracts with its customer, JSCS, Inc. Lisa Tocci, the
customer's office manager, had signed each of the contracts,
which included form language providing that she was personally
liable for the payments due. JSCS went out of business before
paying
