| Raico v Concorde Funding Group |
| 2009 NY Slip Op 01968 [60 AD3d 834] |
| March 17, 2009 |
| Appellate Division, Second Department |
| Dennis P. Raico, Respondent, v Concorde Funding Groupet al., Appellants. |
—[*1] Bee Ready Fishbein Hatter & Donovan, LLP, Mineola, N.Y. (Robert Connolly and JoshuaJemal of counsel), for respondent.
In an action, inter alia, to recover on two promissory notes, the defendants appeal from somuch of an order of the Supreme Court, Nassau County (Austin, J.), dated March 24, 2008, asgranted those branches of the plaintiff's motion which were for summary judgment on the first,second, third, and fourth causes of action against the defendant Ernest E. Craumer and to dismissthe first counterclaim asserted by the defendant Ernest E. Craumer.
Ordered that the appeal by the defendant Concorde Funding Group is dismissed, as thatdefendant is not aggrieved by the order appealed from (see CPLR 5511); and it isfurther,
Ordered that the order is affirmed insofar as appealed from by the defendant Ernest E.Craumer; and it is further,
Ordered that one bill of costs is awarded to the plaintiff.
In March 2005 the defendant Ernest E. Craumer, the chief executive officer of the defendant[*2]Concorde Funding Group (hereinafter Concorde), gave theplaintiff a promissory note (hereinafter note) in the amount of $150,000 which was due andpayable when Concorde obtained an operating line of credit from a bank or one year after thedate of the note, whichever occurred sooner. In June 2005 Craumer gave the plaintiff a secondnote in the amount of $325,000 which was also due upon the execution of an operating line ofcredit or one year after the date of the note, whichever occurred sooner. Both notes were signedby Craumer on a line appearing above his name, while a line above Concorde's name remainedblank.
Craumer defaulted on the notes, and the plaintiff commenced this action against Craumerand Concorde, inter alia, to recover the amount due on the notes, plus attorneys' fees. Craumerand Concorde each asserted a counterclaim, one of which sought to recover from the plaintiff hisalleged share of capital contributions to Concorde that Craumer had advanced. The plaintiffmoved for summary judgment on the complaint and dismissing the counterclaims. In oppositionto the motion, the defendants submitted, inter alia, two "superseding notes," which wereexecuted by Craumer in his capacity as a representative of Concorde. The "superseding notes,"one dated one day after the March 2005 note, and the other dated 10 days after the June 2005note, each provided that the amounts owed thereunder were "due and payable upon the executionand closing of the operating line of credit for [Concorde]." The Supreme Court granted thosebranches of the plaintiff's motion which were for summary judgment on the first, second, third,and fourth causes of action seeking recovery on the notes and attorneys' fees from Craumer anddismissing the first counterclaim asserted by Craumer for an additional capital contribution fromthe plaintiff.
The plaintiff established his prima facie entitlement to judgment as a matter of law on hiscauses of action seeking recovery from Craumer on the notes by proving the existence of theoriginal notes executed by Craumer and Craumer's failure to make payment in accordance withtheir terms (see Levien v Allen, 52AD3d 578 [2008]; QuestCommercial, LLC v Rovner, 35 AD3d 576 [2006]; Constructamax, Inc. v CBAAssoc., 294 AD2d 460 [2002]; Colonial Commercial Corp. v Breskel Assoc., 238AD2d 539 [1997]). In opposition, Craumer failed to raise a triable issue of fact. Contrary toCraumer's contention, the original notes were not superseded or replaced by the "supersedingnotes," which required repayment only when (and if) Concorde obtained an operating line ofcredit. A subsequent note "does not discharge the original indebtedness in the absence of anexpress agreement between the parties" (Federal Natl. Mtge. Assn. v McAuliffe, 226AD2d 497, 498 [1996]; see Home & City Sav. Bank v Sperrazza, 204 AD2d 836,836-837 [1994]; Skaneateles Sav. Bank v Herold, 50 AD2d 85, 88-89 [1975], affd40 NY2d 999 [1976]). Although the "superseding notes" each contained a provision recitingthat they "super[s]ede[d] all other prior agreements and understandings" between the parties, the"superseding notes" were not signed by the plaintiff. Nor does the record contain any otherevidence of an express agreement with the plaintiff that the "superseding notes" were to replacethe original notes or that they would discharge the debt evidenced by the original notes.Moreover, Craumer failed to raise triable issues of fact as to whether he was personally liable onthe notes, and whether the funds referred to in the notes were advanced by the plaintiff as part ofan agreement to make capital contributions to Concorde, as opposed to loans to Craumer.
Craumer's remaining contentions are without merit. Prudenti, P.J., Spolzino, Ritter andSantucci, JJ., concur. [See 2008 NY Slip Op 30968(U).]