Opinion
102438/2009.
Decided March 12, 2010.
On or about October 13, 2009, the plaintiff commenced this action to recover monies allegedly due and owing based upon a promissory note executed by defendant Thomas Scialpi and a personal guaranty executed by defendant Laraine Castellano. It is undisputed that defendant Thomas Scialpi was the owner of an automobile dealership known as Garden State Honda (hereinafter known as "GSH"), located in New Jersey. On June 9, 2004, GSH and the plaintiff, Nissan Motor Acceptance Corporation, entered into an "Automotive Wholesale Financing and Security Agreement" which provided loans to GSH to buy automobiles and/or parts to sell and repair vehicles. GSH would make payments to plaintiff based upon the agreement as inventory was sold.
This is also known as a "floor plan financing".
In 2007, GSH fell into arrears on its obligations to the plaintiff and in an effort to resolve its financial troubles negotiated, with plaintiff's consent, sale of the dealership to non-party Don Lia (the defendant Thomas Scialpi's Uncle). Under the guise of the sale, the proceeds from the sale would be used to reduce a significant portion of the money owed by the defendant Scialpi and, as consideration for the plaintiff agreeing to forebear immediate action to recover the arrears, the parties executed a promissory note for one-million seven hundred and fifty thousand dollars ($1,750,000.00), along with a continuing guaranty by the defendant Scialpi's mother, co-defendant Laraine Castellano. The promissory note and continuing guaranty were executed and signed by the parties on December 18, 2007. In May 2009, the defendant Thomas Scialpi defaulted on his monthly payment of $25,000 and as such, the plaintiff commenced this action to accelerate the loan and recover all monies due and owing under the note and guaranty.
Plaintiff agreed to the personal guaranty of defendant Laraine Castellano because she established she had significant resources to potentially satisfy the debt.
Presently, the plaintiff has moved, pursuant to CPLR § 3213, for summary judgment in lieu of the complaint based upon the promissory note and continuing guaranty.
CPLR § 3213 permits that "[w]hen an action is based upon an instrument for the payment of money only or upon any judgment, the plaintiff may serve with the summons a notice of motion for summary judgment and the supporting papers in lieu of a complaint". Further, "[a] plaintiff moving for summary judgment in lieu of complaint pursuant to CPLR 3213 based on a promissory note establishes prima facie entitlement to judgment as a matter of law by submitting proof of the defendant's execution of the note and the defendant's default in making payments pursuant to the note" ( Cutter Bayview Cleaners Inc. v. Spotless Shirts Inc., 57 AD2d 708, 710 [2d Dept., 2008]; Premium Assignment Corp. v. Utopia Home Care , 58 AD3d 709 , 709 [2d Dept., 2009]; Northport Car Wash Inc. v. Northport Car Car LLC , 52 AD3d 794, 794-795 [2d Dept., 2008]). An instrument does not qualify for summary relief if outside proof is required ( Ro Ke Inc. v. Stevens , 61 AD3d 953, 953-954 [2d Dept., 2009]). "Once plaintiff establishes its prima facie entitlement to judgment as a matter of law, the burden shifts to the defendant to establish, by admissible evidence the existence of a triable issue with respect to a bona fide defense'" ( Cutter Bayview Cleaners Inc. v. Spotless Shirts Inc., 57 AD2d 708, 710 [2d Dept., 2008]; Premium Assignment Corp. v. Utopia Home Care , 58 AD3d 709 , 709 [2d Dept., 2009]; Northport Car Wash Inc. v. Northport Car Car LLC , 52 AD3d 794, 794-795 [2d Dept., 2008]).
Here, the plaintiff met its burden of establishing summary relief by submitting proof of the promissory note, guaranty and the defendants' failure to make the payments according to its terms ( Northport Car Wash Inc. v. Northport Car Car LLC , 52 AD3d 794, 794-795 [2d Dept., 2008]; Quest Commercial, LLC v. Rovner , 35 AD3d 576, 576-577 [2d Dept., 2006]). In opposition, the defendants have failed to raise triable issues of fact with respect to a bona fide defense ( id.). The promissory note provides that defendants waived notices and defenses, namely:
"5. Waivers. Borrower and all co-makers, guarantors, accommodation parties, endorsers and other persons and entities liable for amounts owing hereunder hereby waive any right to offset, presentment, demand, protest, notice of dishonor, notice of protest and all other notices and demands of every kind, and all suretyship defenses of every kind that would otherwise be available in connection with this Note, including without limitation any right (whether now or hereafter existing) to require the holder hereof to first proceed against Borrower, any other person or entity, or any security."
Further, while defendants have raised the defenses of, inter alia, fraud and misrepresentation, they have failed to provide any admissible evidence to substantiate such allegations. The defendants only presented self-serving, conclusory affidavits which are insufficient to defeat a motion for summary judgment ( Quest Commercial v. Rovner , 35 AD3d 576, 576 [2d Dept. 2006][finding summary judgment, pursuant to CPLR 3213, appropriate where the plaintiff made a prima facie showing and defendant failed to raise an issue of fact through conclusory affidavits]; Northport Car Wash, Inc. v. Northport Car Care LLC , 52 AD3d 794, 794-795 [2d Dept., 2008]). In addition, the defendants, who do not dispute signing the promissory note and guaranty, are sophisticated professionals who had several prior dealings with the plaintiff; namely two additional dealerships. In lieu of the aforementioned, the defendant's have failed to raise a triable issue with respect to a bona fide defense and as such, the plaintiffs motion, pursuant to CPLR § 3213, is hereby granted.
Accordingly, it is,
ORDERED that the plaintiff Nissan Motor Acceptance Corporation's motion, pursuant to CPLR § 3213, for summary judgment in lieu of a complaint, is hereby granted in its entirety, and it is further
ORDERED that the Clerk enter Judgment Accordingly.
THIS IS THE DECISION AND ORDER OF THE COURT.