Gold & Gems Auto, Inc. and Chad Eric Roy Montgomery, Appellants-Defendants v. NextGear Capital, Inc., Appellee-Plaintiff (2026)

MEMORANDUM DECISION

[1] Gold & Gems Auto, Inc. (“Dealer”) and its CEO, Chad Eric Roy Montgomery (“CEO”) (collectively, “the Defendants”), appeal the trial court's order resolving competing motions for summary judgment in favor of NextGear Capital, Inc. (“Lender”). We affirm.

Facts and Procedural History

[2] Dealer is a California corporation that operates an automobile dealership in San Pablo, California. Lender, a Delaware corporation with its principal place of business in Carmel, Indiana, is in the business of providing financing to automobile dealerships. In April 2023, the parties executed related instruments establishing a lending arrangement where Lender would facilitate Dealer's purchase of vehicles to sell. The centerpiece of the lending arrangement was a Demand Promissory Note and Loan and Security Agreement (“the Note”).

[3] Under the Note, Lender would advance funds for Dealer to acquire specific vehicles—each a “Unit”—providing what the Note referred to as a “Floorplan Advance.” Appellants’ App. Vol. 2 pp. 121–23. In general, Dealer had to repay Lender within forty-five days of the “Floorplan Date,” i.e., the date Lender received Dealer's request for a Floorplan Advance. Id. at 111, 121, 124. But if Lender declared a “Maturity Event,” repayment was due immediately. Id. at 31, 122. The Note defined a “Maturity Event” as “any event, act[,] or circumstance arising under th[e] Note or any other Loan Document,” including “any failure” by Dealer “to adhere to any term or provision” thereof, which caused Lender to declare the event a “ ‘Maturity Event’ with respect to any Floorplan Advance ․” Id. at 122.

[4] The Note imposed several requirements in connection with each Floorplan Advance. In pertinent part, Section 5(c) required Dealer to “deliver or cause to be delivered” to Lender “the Title” for each Unit within seven days after Lender funded the related Floorplan Advance. Id. at 111. The Note defined “Title” as “the certificate of title or other document evidencing ownership of a Unit issued by a duly authorized state, commonwealth, province, or government agency.” Id. at 123. A “Receivable Advance” was a loan made in connection with a “Receivable”—that is, an installment sales contract or similar instrument through which a buyer owed money to Dealer for the purchase of a vehicle. Id. at 122. Section 5(d) imposed an obligation similar to Section 5(c)’s title requirement: Dealer had to “deliver ․ the original Receivable which is the subject of the Receivable Advance” within seven days of funding. Id. at 111. That provision expressly required delivery of the “original” Receivable. Id.

[5] The Note specified that any failure by Dealer to adhere to the terms and conditions of the Note or any other loan document gave Lender the right, “in its sole discretion and without notice to [Dealer], to declare a Maturity Event ․” Id. If Lender declared a Maturity Event, all outstanding liabilities would be accelerated, making them immediately due and payable. The Note separately defined “Event of Default” to include any failure by Dealer to perform an obligation under the Note or the loan documents—a determination that entitled Lender, without notice, to demand immediate payment of all liabilities and to enter Dealer's premises to take possession of the collateral. Id. at 114. Dealer pledged its inventory as the collateral for the loans. CEO separately executed an individual guaranty (“the Guaranty”) under which he personally and unconditionally guaranteed all of Dealer's obligations to Lender. The Note and the Guaranty specified that Lender would recover its attorney's fees and costs to enforce the Note and other loan documents.

[6] As part of the financial arrangement, Dealer executed an ACH Authorization and Request form (“the ACH Form”), which authorized Lender to initiate electronic debits from Dealer's designated bank account for the repayment of Floorplan Advances. Dealer was obligated to “maintain sufficient funds” in the account to satisfy its payment obligations to Lender. Id. at 154. The ACH Form authorized Lender to initiate two types of debits: an “Elective Payment,” which Lender could initiate at any time following a request from Dealer, and a “Required Payment” for the amount due and owing, which Lender could initiate on the first business day following a “Maturity Date.” Id. In general, a “Maturity Date” was “the earlier of the last day of the current Period or the day on which Lender declares a Maturity Event ․” Id. at 121–22. However, if Lender declared an Event of Default, the Maturity Date was the earlier of “(i) the date on which such Event of Default is declared by Lender, or (ii) the date on which such Event of Default first occurred.” Id. at 122.

[7] On August 31, 2023, CEO used Lender's online system to request a Floorplan Advance of $68,000.00 for Dealer's purchase of a 2011 Bentley Mulsanne (“the Vehicle”). In support, Dealer uploaded several documents, including a copy of the Vehicle's certificate of title. CEO clicked “Agree and Submit” on a screen presenting Terms and Conditions. Id. at 148. Among the Terms and Conditions was a requirement that Dealer deliver the Title no later than 5:00 p.m. EST on the seventh day following the Floorplan Date—a deadline that, if not met, would mean that Dealer asked Lender to make an Elective Payment:

[Dealer] further requests Lender to initiate an Elective Payment, at any time after 5:00PM EST on such seventh (7th) day following the Floorplan Date for such Floorplan Advance, for all Liabilities related to any Floorplan Advance for which the Title ․ for the related Unit(s) has not been received by Lender within such time frame.

Id. at 148.

[8] Lender funded the Floorplan Advance for the Bentley on the same day as the Floorplan Request, depositing $68,000.00 into Dealer's account. The seventh day following the Floorplan Date was September 7, 2023. On that date, Lender received a color copy of a title document for the Vehicle. However, by 5:00 p.m. EST, Dealer had not delivered the original certificate of title for the Vehicle. After the deadline on September 7, 2023, Lender initiated an ACH debit from Dealer's account in the amount of the outstanding Floorplan Advance. On September 12, 2023, Lender learned that Dealer's account lacked sufficient funds to cover the debit. On that date, Lender told Dealer it needed original title documentation and asked if Dealer had the original. Dealer responded that, as of that date, it only had “a signed copy ․” Id. at 150. Thereafter, Lender “declared [Dealer]” in default and “demanded full payment of the amount due under the Note ․” Id. at 184. Lender took possession of two vehicles from Dealer's inventory purchased through Floorplan Advances.¹

[9] In November 2023, Lender filed this action against the Defendants in the Hamilton Superior Court. Lender brought a claim of breach of contract against Dealer, alleging that Dealer failed to repay its outstanding indebtedness under the Note. Lender also brought a claim of breach of guaranty against CEO, alleging that CEO was personally obligated under the Guaranty for that same indebtedness. The Defendants counterclaimed for breach of contract.² They alleged that Lender prematurely debited Dealer's account before any repayment obligation had matured, wrongfully declared Dealer in default without contractual authority, and wrongfully took possession of the collateral.

[10] In April 2024, Lender moved for summary judgment on its claims and the counterclaim, designating as evidence the Note, the Guaranty, the ACH Form, an affidavit of Lender's Director of Credit and Collections, and online account records. In June 2024, the Defendants filed a response in opposition and a cross-motion for summary judgment on all claims, designating as evidence the affidavit of CEO and related exhibits. Following extensions of time, in June 2025, Lender filed a reply brief in support of its motion and a response in opposition to the Defendants’ cross-motion. Lender also obtained leave to designate as evidence a supplemental affidavit from its Director of Credit and Collections, attaching excerpts from a deposition of CEO taken in August 2024.

[11] The trial court held a hearing on the competing motions on September 8, 2025. There was argument about whether Dealer was obligated to provide an original title document. Counsel for the Defendants at one point acknowledged that the photocopy provided to Lender was not itself issued by a duly authorized state, commonwealth, province, or government agency. See Tr. Vol. 2 p. 11. However, counsel maintained that a photocopy satisfied the title requirement.

[12] On September 10, 2025, the trial court entered its order granting Lender summary judgment on all claims. In supporting findings, the court explained that the Note's definition of “Title” required a document “issued by a duly authorized state, commonwealth, province, or government agency,” and that a photocopy is not such a document. Appellants’ App. Vol. 2 p. 13. The court further found that Dealer was not in possession of the Title at any point from the time of the Floorplan Advance to at least September 12, 2023, and therefore Dealer could not have delivered the Title regardless. Id. The trial court also determined that CEO had reasonable notice of and manifested assent to the Terms and Conditions presented at the time of the Floorplan Advance, and that those Terms and Conditions constituted a valid and binding contract between Lender and Dealer. Based on these determinations, the trial court concluded that Dealer defaulted under the Note by failing to make required payments and that Lender took authorized actions in response to Dealer's default. The trial court awarded Lender a judgment of $88,388.86 against the Defendants, plus attorneys’ fees, expenses, and interest. The Defendants now appeal.

Discussion and Decision

[13] The Defendants claim the trial court erred in resolving the summary judgment motions in favor of Lender. They maintain that Dealer satisfied its obligation to deliver the Title by providing a copy of the title document—and therefore, Lender had no right to initiate the debit and take possession of the collateral.

I. Standard of Review

[14] “We review summary judgment decisions de novo, and Trial Rule 56(C) supplies the framework.” Cave Quarries, Inc. v. Warex LLC, 240 N.E.3d 681, 684 (Ind. 2024). Under that rule, “[t]he moving party is entitled to summary judgment only if the evidence it designates in support of its motion ‘shows that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.’ ” Id. at 684–85 (quoting Ind. Trial Rule 56(C)). The party moving for summary judgment bears the burden of making a prima facie showing that there is no issue of material fact and that it is entitled to judgment as a matter of law. Burton v. Benner, 140 N.E.3d 848, 851 (Ind. 2020). The burden then shifts to the non-moving party to show the existence of a genuine issue of material fact. Id. We resolve any doubt as to facts or inferences in favor of the non-moving party. Id.

[15] Here, the trial court entered special findings supporting its judgment, which aid our review but do not bind us. In re Supervised Estate of Kent, 99 N.E.3d 634, 637 (Ind. 2018). Further, our approach is not altered by the existence of competing motions for summary judgment; in this scenario, “we consider each motion separately to determine whether the moving party is entitled to judgment as a matter of law.” Erie Indem. Co. v. Estate of Harris, 99 N.E.3d 625, 629 (Ind. 2018) (quoting SCI Propane, LLC v. Frederick, 39 N.E.3d 675, 677 (Ind. 2015)).

[16] This case turns on contract interpretation, which involves pure questions of law that we review de novo. Thomas v. Valpo Motors, Inc., 258 N.E.3d 236, 239 (Ind. 2025). When interpreting a contract, our goal is to “ascertain the intent of the parties at the time the contract was made, as disclosed by the language used to express the parties’ rights and duties.” Ryan v. TCI Architects/Eng'rs/Contractors, Inc., 72 N.E.3d 908, 914 (Ind. 2017). If the terms are clear and unambiguous, we “must give those terms their clear and ordinary meaning.” Dunn v. Meridian Mut. Ins. Co., 836 N.E.2d 249, 251 (Ind. 2005). We look at the contract as a whole and “accept an interpretation of the contract that harmonizes all its provisions.” Berg v. Berg, 170 N.E.3d 224, 231 (Ind. 2021) (quoting Ryan, 72 N.E.3d at 914). We also construe the contract “so as to not render any words, phrases, or terms ineffective or meaningless.” Ryan, 72 N.E.3d at 914. So long as the contract language is unambiguous, the parties’ intent is determined by the language within the four corners of the written instrument. Id. at 917.

II. Copy vs. Original

[17] The Defendants claim that, by delivering a photocopy of the Vehicle's certificate of title, Dealer satisfied its obligation to timely deliver “the Title” under Section 5(c) of the Note and the Terms and Conditions it accepted in requesting the Floorplan Advance. The Note defined “Title” as “the certificate of title or other document evidencing ownership of a Unit issued by a duly authorized state, commonwealth, province, or government agency.” Appellants’ App. Vol. 2 p. 123. The definition of Title thus identifies two types of qualifying documents: first, “the certificate of title,” and second, any “other document evidencing ownership of a Unit ․” Id. But both specified types of documents are modified by the phrase at the end of the definition: “issued by a duly authorized state, commonwealth, province, or government agency.” Id. Grammatically, that closing phrase modifies the entire preceding noun structure. The phrase provides that whether the document is a certificate of title or some other ownership document, it must have been issued by a governmental authority.

[18] The Defendants do not dispute that the photocopy provided to Lender was not “issued by” a governmental authority. Id. But they claim Section 5(c) does not require an original document. In support of their reading, the Defendants point out that a different section of the Note—Section 5(d)—expressly requires delivery of “the original Receivable,” id. at 111, but that Section 5(c) does not contain the same reference to an original document. Because 5(d) contains the word “original” and 5(c) does not, the Defendants argue that 5(c) means something different. They claim that, if the intent was to require an original, 5(c) would have included the word “original,” just like 5(d) was drafted. Id.

[19] We disagree with Dealer's reading. Sections 5(c) and 5(d) deploy different language because they address two different types of documents. Whereas Section 5(c) addresses government-issued ownership documents, Section 5(d) addresses transactional documents created by private parties. See id. at 122 (defining “Receivable” as “chattel paper,” which includes “a retail installment contract or buy here pay here contract”). That is why Section 5(c) requires either the Title—i.e, there can only be one, and therefore, a copy is not the Title—or a different government-issued document that evidences ownership of a vehicle. In contrast, Section 5(d) requires the original document created by private parties. Each authenticates the distinct type of document at issue, and the means to do so differs because the documents are of different species.

[20] The Defendants argue in the alternative that Section 5(c) is ambiguous as to whether Dealer was obligated to deliver an original document, and that the ambiguity must be construed against Lender as the drafter of the Note. “To the extent [a] contract reveals any ambiguities, those ambiguities are generally construed against the drafter.” Thomas, 258 N.E.3d at 241. Notably, however, “[a] contract is not ambiguous simply because the parties disagree about the proper interpretation of its terms.” Wohlt v. Wohlt, 245 N.E.3d 611, 616 (Ind. 2024). “Instead, for an ambiguity to exist, the contract must be subject to more than one reasonable interpretation.” Id. (emphasis added). For the reasons explained above, the Defendants’ interpretation of Section 5(c) is not reasonable.

[21] The Defendants’ remaining arguments turn on its contention that Lender lacked authority to initiate an ACH debit. We conclude that Lender was authorized to initiate the debit as an Elective Payment under the Terms and Conditions that Dealer accepted when requesting the Floorplan Advance.³ It is undisputed that Dealer failed to deliver the Vehicle's original certificate of title by 5:00 p.m. EST on September 7, 2023—the seventh day following the Floorplan Date. For the reasons previously discussed, we conclude that the term Title referred to the original title document. The Terms and Conditions contained Dealer's specific request that Lender initiate an Elective Payment—covering all liabilities related to the Floorplan Advance—at any time after 5:00 p.m. EST on the seventh day following the Floorplan Date if Dealer had not provided the Title to Lender by that time. The designated evidence establishes that all conditions were met for Dealer's request to make an Elective Payment: the Floorplan Date was August 31, 2023; the deadline accordingly fell at 5:00 p.m. EST on September 7; the Title was not received by that deadline; and Lender initiated the debit after 5:00 p.m. EST that same day.

[22] When Dealer's account lacked sufficient funds to cover the full amount of the debit, Dealer had failed both to deliver the Title and to repay the advance. Under the Note's Event of Default provisions, Lender was entitled to declare the entire indebtedness immediately due and to take possession of the collateral to repay the debt. Lender's actions were authorized by the contracts. Thus, Lender did not breach its contractual obligations. Rather, Dealer breached its obligations under the Note. As a result, Dealer was liable to Lender under the Note and CEO was responsible for Dealer's obligations under the Guaranty.

[23] For the foregoing reasons, we conclude that Lender was entitled to summary judgment on its claims of breach of contract and breach of guaranty, and on the Defendants’ counterclaim for breach of contract. We, therefore, affirm.

[24] Affirmed.

FOOTNOTES

1.   Lender could not locate the Vehicle because Dealer had not taken possession of it.

2.   The parties brought additional claims that were either dismissed or not at issue on appeal.

3.   Having resolved the issue on these grounds, we do not address other theories as to the debit, such as the Defendants’ contention that the ACH debit could not be authorized as a Required Payment.

Foley, Judge.

Tavitas, C.J., and Weissmann, J., concur.