                United States Court of Appeals
                            For the Eighth Circuit
                        ___________________________

                                No. 14-2164
                        ___________________________

                                     Avnet, Inc.

                       lllllllllllllllllllll Plaintiff - Appellee

                                          v.

                         Catalyst Resource Group, LLC

                            lllllllllllllllllllll Defendant

                                   David A. Wild

                      lllllllllllllllllllll Defendant - Appellant
                                      ____________

                    Appeal from United States District Court
                for the Northern District of Iowa - Cedar Rapids
                                 ____________

                          Submitted: February 11, 2015
                              Filed: July 2, 2015
                                ____________

Before BYE, BEAM, and BENTON, Circuit Judges.
                           ____________

BYE, Circuit Judge.
      David Wild appeals the district court's1 determination that a personal guaranty
he executed as security for a loan could be enforced by the original creditor's assignee
under Iowa law. We affirm.

                                           I

      David Wild is the sole member of a limited liability company called Braveheart
Equity Holdings, LLC (Braveheart). Braveheart, in turn, is one of two members of
another limited liability company called Catalyst Resources Group, LLC (Catalyst).
In 2008, Catalyst borrowed $500,000 from Laurus Technologies, Inc. (Laurus). Wild
signed a personal guaranty as security for Catalyst's loan. In relevant part, the
personal guaranty provides as follows: "The undersigned [does] hereby personally
guarantee . . . to Laurus Technologies, Inc, the Holder, full complete and timely
performance by the Borrower [Catalyst], of all obligations of the Borrower under the
foregoing Promissory Note." The personal guaranty did not expressly extend Wild's
promise to Laurus's "successors and assigns," but it also did not expressly prohibit
assignment of the guaranty.

       Several years after making the loan, Laurus assigned the Catalyst promissory
note to a company called Avnet, Inc., as part of a forbearance agreement on a debt
Laurus owed to Avnet. After the assignment, an attorney for Avnet contacted
Catalyst demanding payment of the $500,000 loan plus interest. When Catalyst did
not make any payments on the loan, Avnet's attorney contacted Wild and demanded
that he honor his personal guaranty.




      1
       The Honorable John Stuart Scoles, Chief Magistrate Judge for the Northern
District of Iowa, presiding with the consent of the parties pursuant to 28 U.S.C.
§ 636(c).

                                          -2-
       When Wild did not honor his personal guaranty, Avnet filed a complaint in
federal district court against both Catalyst and Wild. Avnet sought a judgment
against Catalyst on the promissory note and a judgment against Wild on his personal
guaranty. Catalyst did not respond to the suit, and eventually a default judgment was
entered against the company in the amount of $770,065.80 (representing both the
original $500,000 loan as well as accrued interest), plus post-judgment interest. Wild
did respond to the suit. He contended his guaranty was a "special guaranty" (one
directed solely to a specific creditor) rather than a "general guaranty" because it was
only directed to Laurus. Wild further contended a special guaranty could not be
assigned under Iowa law, and could only be enforced by the original creditor.

       Avnet filed a motion for summary judgment. The disputed issue was whether
the Iowa Supreme Court would follow the common law rule under which a special
guaranty is not enforceable by a creditor's assignee, or would follow the rule set forth
in the Restatement (Third) of Suretyship and Guaranty § 13 which generally allows
a creditor's assignee to enforce a guaranty even if it would have traditionally been
considered a special guaranty under the common law. After a thorough examination
of Iowa law, the district court determined the Iowa Supreme Court would adopt § 13.
The district court further held none of § 13's exceptions applied in this case. The
district court therefore concluded Avnet could enforce Wild's personal guaranty and
granted summary judgment in Avnet's favor. Wild filed this timely appeal.

                                           II

      We review the district court's grant of summary judgment de novo. Loomis v.
Wing Enters., Inc., 756 F.3d 632, 634 (8th Cir. 2014). The parties agree Iowa
substantive law applies in this diversity case. See Erie R. Co. v. Tompkins, 304 U.S.
64, 78 (1938). Because the issue before us has not been decided by the Iowa courts,
"[w]e must predict how the Iowa Supreme Court would rule, and we follow decisions
of the intermediate state court when they are the best evidence of Iowa law."

                                          -3-
Amera-Seiki Corp. v. Cincinnati Ins. Co., 721 F.3d 582, 585 (8th Cir. 2013) (internal
alterations omitted).

       Wild relies upon the common law rule and contends Avnet could not enforce
his personal guaranty because he executed it only in favor of Laurus, the original
creditor. See, e.g., New Holland, Inc. v. Trunk, 579 So. 2d 215, 217 (Fla. Dist. Ct.
App. 1991) ("A 'special' guaranty is one addressed to a particular entity and under it
ordinarily only the named or specifically described promisee acquires rights.");
Flying J, Inc. v. Booth, 773 P.2d 144, 146-49 (Wyo. 1989) (concluding the "common
law approach" prohibits the assignment of a special guaranty which refers "to only
one creditor such as a particular person, firm, or corporation").

      Avnet counters that the modern rule generally permits the assignment of a
personal guaranty irrespective of whether it would have been considered a special
guaranty under the common law. This rule is set forth in the Restatement (Third) of
Suretyship and Guaranty § 13. The Restatement does not distinguish between the
assignment of special or general guaranties, but instead recognizes any guaranty can
be assigned unless:

      (a) the substitution of a right of the assignee for the right of the obligee
      would materially change the duty of the secondary obligor or materially
      increase the burden or risk imposed on it by its contract; or

      (b) the assignment is forbidden by statute or is otherwise ineffective as
      a matter of public policy; or

      (c) the assignment is validly precluded by contract.

Restatement (Third) of Suretyship and Guaranty § 13(1) (1996). Avnet further
contends the Iowa courts would adopt § 13 because they have adopted other sections
of the Restatement. See, e.g., Hills Bank & Trust Co. v. Converse, 772 N.W.2d 764,


                                          -4-
772 (Iowa 2009) (adopting § 22 of the Restatement (Third) of Suretyship and
Guaranty); Gallagher, Langlas & Gallagher v. Burco, 587 N.W.2d 615, 618 (Iowa Ct.
App. 1998) (adopting § 11 of the Restatement (Third) of Suretyship and Guaranty).
Avnet argues it should be allowed to enforce Wild's personal guaranty unless one of
the three specifically enumerated exceptions listed under § 13 of the Restatement
applies.

      After reviewing the relevant Iowa case law, which has not specifically
addressed whether a special guaranty may be assigned,2 we conclude the Iowa
Supreme Court would adopt the modern rule set forth in § 13 if faced with the issue.3

      2
        See, e.g., Schoonover v. Osborne, 79 N.W. 263, 264 (Iowa 1899) (noting "the
courts have usually held that a guaranty addressed to a particular party can only be
acted upon and enforced by that party"); Williamson Heater Co. v. Whitmer, 183
N.W. 404, 405 (Iowa 1921) (generally recognizing the common law distinction
between a special and general guaranty); Andrew v. Austin, 232 N.W. 79, 81 (Iowa
1930) ("The same rule is to be applied in the construction of contracts of guaranty as
other contracts."); Fid. Sav. Bank v. Wormhoudt Lumber Co., 104 N.W.2d 462, 466
(Iowa 1960) (generally recognizing "that a guarantor is discharged from his
obligation by any act on the part of the guarantee which increases the guarantor's risk
or in any manner injures his rights or remedies"); Union Trust & Sav. Bank v. State
Bank, 188 N.W.2d 300, 302 (Iowa 1971) (addressing whether a special guaranty is
continuing in nature).
      3
          The Iowa Code generally provides as follows:

      [A]ll instruments by which the maker promises to pay another, without
      words of negotiability, a sum of money . . . are assignable by
      endorsement on the instrument, or by other writing. The assignee . . .
      has a right of action on them in the assignee's own name, subject to any
      defense or counterclaim which the maker or debtor had against an
      assignor of the instrument before notice of the assignment.

Iowa Code § 539.1.


                                         -5-
The Iowa Supreme Court has long recognized that, "like every other contract [a
personal guaranty] must receive a reasonable and sensible construction, according to
the intent of the parties as read in the light of the circumstances surrounding the
transaction, and the purposes for which it was made." Harman v. Hartman, 160 N.W.
295, 297 (Iowa 1916). Significantly, "[n]o different rule obtains in construing
[personal guaranties] than [other contracts], save that when the terms of a guaranty
are once ascertained the liability of the guarantor is not to be extended by
implication." Id.; see also Andrew v. Austin, 232 N.W. 79, 81 (Iowa 1930)
(indicating contracts of guaranty are subject to the same rules of construction as other
contracts).

        This well-established principle of Iowa law – that the same rules of
construction generally applicable to contracts apply equally to personal guaranties –
is the very premise upon which § 13 is based. See Restatement (Third) of Suretyship
and Guaranty § 13, cmt. a (noting § 13 abolished the historical common law rule
distinguishing special guaranties from general guaranties because the secondary
obligations arising from a guaranty should be "subject to general contract principles
concerning assignment"). For this reason, as well as the fact that the Iowa courts
have adopted other sections of the Restatement (Third) of Suretyship and Guaranty,
we believe the Iowa Supreme Court would also adopt § 13.

        We further conclude that none of the three exceptions listed in § 13 apply here.
First, the assignment from Laurus to Avnet did not materially change Wild's duties
under the guaranty, or materially increase the burden or risk imposed upon him.
Before the assignment, Wild was bound by the guaranty to repay the loan should
Catalyst fail to do so. After the assignment, Wild had the same obligation to repay

      This statute appears to govern the circumstances involved in this case, but its
applicability was not addressed by the parties in the district court or on appeal.
Without adversarial briefing on the issue, we decline to decide at this time whether
§ 539.1 is dispositive, and would permit the assignment of Wild's personal guaranty.

                                          -6-
the loan should Catalyst fail to do so. The assignment thus did not extend Wild's
liability "by implication" or otherwise. Harman, 160 N.W. at 297. We reject Wild's
contention the assignment increased his risk because Laurus was a "friendly creditor"
(i.e., the close personal relationship between the principals of Catalyst and Laurus
caused Laurus not to exercise its rights). Wild asserts this increase in risk is proven
by the fact that Avnet promptly demanded payment of the loan once it received the
assignment. Wild's duties to both the original creditor and the assignee remained the
same, however, with the only difference being whether the holder of the promissory
note elected to exercise its own rights. See Restatement (Third) of Suretyship and
Guaranty § 13(3) ("[T]he possibility that the assignee might exercise its rights under
the assigned obligation differently than the assignor does not in itself materially
change the duty of the secondary obligor or materially increase the burden or risk
imposed on it by its contract.").

       Second, the assignment between Laurus and Avnet was not forbidden by
statute or otherwise ineffective as a matter of public policy. Indeed, Wild does not
contend otherwise.

        Finally, the assignment was not precluded by the original contract. Although
the guaranty referred specifically to Laurus, it also referred to Laurus as "the Holder"
of the note, and thus inferred the guaranty inured to the benefit of the party holding
the note. More significantly, the personal guaranty did not expressly state it was not
assignable. Wild contends the guaranty was ambiguous because it did not expressly
state it could be assigned, and it was his intention that the guaranty not be assigned.
We disagree the guaranty was ambiguous. Even if it were, however, the ambiguity
would be strictly construed against Wild as the drafter (via his attorney) of the
guaranty. See Iowa Fuel & Minerals, Inc. v. Iowa State Bd. of Regents, 471 N.W.2d
859, 863 (Iowa 1991) ("[W]hen there are ambiguities in a contract, they are strictly
construed against the drafter."). In addition, Wild's undisclosed intentions are
immaterial because the guaranty itself contains no language clearly identifying to a

                                          -7-
potential assignee that the note and guaranty were not assignable. See First Nw. Nat'l
Bank v. Crouch, 287 N.W.2d 151, 153 (Iowa 1980) ("The intention expressed in the
instrument prevails over the secret intention of the drafter."); Waechter v. Aluminum
Co. of Am., 454 N.W.2d 565, 568 (Iowa 1990) ("In searching for [the parties' mutual]
intention, we look to what the parties did and said, rather than to some secret,
undisclosed intention they may have had in mind, or which occurred to them later.").

       Because we believe the Iowa Supreme Court would adopt § 13 of the
Restatement (Third) of Suretyship and Guaranty, and none of the three exceptions
listed under § 13 apply in this case, the district court did not err in granting summary
judgment in favor of Avnet.4

                                          III

      We affirm the judgment of the district court.
                      ______________________________




      4
       With respect to the other issues raised by Wild on appeal, we affirm for the
reasons stated by the district court. See 8th Cir. R. 47B.

                                          -8-
