| Carlin v Jemal |
| 2009 NY Slip Op 09695 [68 AD3d 655] |
| December 29, 2009 |
| Appellate Division, First Department |
| Martin Carlin, Appellant, v Stephan Jemal, Individuallyand as Member or Manager of SSJ Development, LLC, et al.,Respondents. |
—[*1] Karson & Long LLP, New York (Stephen P. Long of counsel), for respondents.
Order, Supreme Court, New York County (Charles E. Ramos, J.), entered May 28, 2009,which denied plaintiff's motion for summary judgment seeking enforcement of a promissory notemade by defendants Stephan Jemal, individually, and SSJ Development, LLC, unanimouslyreversed, on the law, without costs, the motion granted, and the matter remanded for furtherproceedings, including the calculation of appropriate attorneys' fees, costs, and interest.
Regardless of whether plaintiff is a "holder in due course" (see UCC 3-302), a mere"holder" (see UCC 1-201 [20]), or only an "assignee" or "transferee" (see NationalBank of N. Am. v Flushing Natl. Bank, 72 AD2d 538, 539 [1979]; Phoenix GlobalVentures, LLC v Phoenix Hotel Assoc., Ltd., 10 Misc 3d 1066[A], 2006 NY Slip Op50007[U] [Sup Ct, NY County 2006]), he has standing to bring this action (see UCC3-201, 3-301, 3-305, 3-306; National Fin. Co. v Uh, 279 AD2d 374 [2001]). The record,including the unrefuted testimony of the original named payee of the note and of plaintiff,establishes that, at the very least, plaintiff took the note as assignee prior to commencement ofthe action.
Even if plaintiff is not a holder in due course, but only a holder or assignee/transferee, andthus subject to all defenses (see UCC 3-306; National Bank of N. Am., 72 AD2dat 539), he is entitled to summary judgment, since defendants failed to raise a triable issue of factregarding their proffered defenses.
With respect to the defense of oral modification of the repayment terms, the note containedan express provision requiring that any modification thereof be in writing to be enforceable, theintegrity of which is protected by General Obligations Law § 15-301 (1) (see DFICommunications v Greenberg, 41 NY2d 602, 606-607 [1977]). There is no evidence in therecord of partial performance by plaintiff or defendants that is unequivocally referable to eitherof the two oral modifications alleged by defendants (see Rose v Spa Realty Assoc., 42NY2d 338, 343-344 [1977]; Fairchild Warehouse Assoc. v United Bank of Kuwait, 285AD2d 444, 445 [2001]). Neither defendants' failure to pay on the due date nor plaintiff's apparentfailure to demand immediate payment constitutes partial performance, because neither isunequivocally referable to the alleged oral modifications, as there may have been otherexplanations for such decisions (see e.g. National Westminster Bank USA v VannierGroup, 160 AD2d 348, 349-350 [1990]). There is also no evidence in the record thatdefendants changed their position in any [*2]way or relied totheir detriment on any oral modification so as to estop plaintiff from asserting the absence of awriting and enforcing the original June 1, 2007 maturity date (see id.).
The defense of lack of consideration is equally unsupported by the record. Contrary todefendants' contention, plaintiff was not required to demonstrate that there was adequateconsideration for the note. Since plaintiff met his initial burden of demonstrating entitlement torecovery on the note by submitting proof of the note and defendants' default thereon, anddefendants have not challenged the authenticity of their signatures on the note, the burden thenshifted to defendants to demonstrate lack of consideration as a defense (see UCC 3-307[2]; Di Marco v Bombard Car Co.,Inc., 11 AD3d 960 [2004]). Defendants make only conclusory allegations that the loanwas not fully funded, and fail to offer any evidence, documentary or otherwise, to substantiatethat allegation. Moreover, their concession that at least some portion of the loan was fundeddefeats their defense of lack of consideration (see Laham v Bahia Mehmet Bin Chambi,299 AD2d 151, 152 [2002]), particularly where, as here, the note is "clear, complete andunambiguous" on its face and recites that it was executed for value (Di Marco, 11 AD3dat 961 [internal quotation marks and citation omitted]). Concur—Sweeny, J.P., Buckley,DeGrasse, Freedman and Abdus-Salaam, JJ.