| Key Equip. Fin. v South Shore Imaging, Inc. |
| 2010 NY Slip Op 00479 [69 AD3d 805] |
| January 19, 2010 |
| Appellate Division, Second Department |
| Key Equipment Finance, Also Known as American ExpressBusiness Finance Corp., Appellant, v South Shore Imaging, Inc., et al.,Respondents. |
—[*1] John Z. Marangos, Staten Island, N.Y., for respondents South Shore Imaging, Inc., andJoseph Romagnolo. Thaniel J. Beinert, Brooklyn, N.Y. (Marc A. Merolesi of counsel), for respondents RonaldPandolfini and Jason Pandolfini.
In an action, inter alia, to recover damages for breach of contract, the plaintiff appeals, aslimited by its brief, from so much of an order of the Supreme Court, Richmond County (Maltese,J.), dated August 18, 2008, as granted the motion of the defendants South Shore Imaging, Inc.,and Joseph Romagnolo for summary judgment dismissing the complaint insofar as assertedagainst the defendant Joseph Romagnolo, granted the separate motion of the defendants RonaldPandolfini and Jason Pandolfini for summary judgment dismissing the complaint insofar asasserted against them, and denied those branches of the plaintiff's cross motion which were forsummary judgment on the complaint insofar as asserted against the defendants RonaldPandolfini, Jason Pandolfini, and Joseph Romagnolo.
Ordered that the order is reversed insofar as appealed from, on the law, with one bill of costs,the motion of the defendants South Shore Imaging, Inc., and Joseph Romagnolo for summaryjudgment dismissing the complaint insofar as asserted against the defendant Joseph Romagnolois denied, the separate motion of the defendants Ronald Pandolfini and Jason Pandolfini forsummary judgment dismissing the complaint insofar as asserted against them is denied, andthose branches of the plaintiff's cross motion which were for summary judgment on thecomplaint insofar as asserted against the defendants Ronald Pandolfini, Jason Pandolfini, andJoseph Romagnolo are granted.
On August 1, 2002, the defendant South Shore Imaging, Inc. (hereinafter South Shore),agreed to lease from the plaintiff a Konica laser imager machine for a period of 63 months. Theplaintiff commenced this action, inter alia, to recover damages for breach of contract againstSouth Shore and the individual defendants Ronald Pandolfini, Jason Pandolfini, and JosephRomagnolo (hereinafter collectively the individual defendants), the president, vice president, andtreasurer, respectively, of South Shore, alleging, among other things, that the defendants failed tomake the payments due under the lease.[*2]
The lease comprised four pages: a two-page master lease,a one-page equipment schedule to the master lease, and a one-page payment schedule. Themaster lease, the equipment schedule, and the payment schedule (hereinafter collectively thelease) each bore its own signature block(s) for execution of that particular document. The masterlease was executed by the defendant Ronald Pandolfini, as president of South Shore.
As is pertinent to this appeal, the equipment schedule contained a guaranty section(hereinafter the guaranty, and, together with the equipment schedule, the equipmentschedule/guaranty) which provided, in relevant part, that the guarantors unconditionally andirrevocably guaranteed the payment and performance of all obligations of South Shore, thelessee under the lease. Each of the guarantors also agreed that his liability was joint and several.Further, the guaranty authorized the plaintiff to obtain and share credit information regardingeach guarantor's "personal" credit. The unsigned equipment schedule/guaranty that the plaintiffsent to the defendants for execution contained three signature blocks, one for each of theindividual defendants. Preprinted under the signature lines were the names of the individualdefendants without their corporate titles.
While officers or agents of a corporation are not liable on its contracts if they do not purportto bind themselves individually (see generally Savoy Record Co. v Cardinal Export Corp.,15 NY2d 1, 4 [1964]; Weinreb vStinchfield, 19 AD3d 482, 483 [2005]), the terms of the instant guaranty constituted adeliberately stated, unambiguous, and separate expression personally obligating the individualdefendants for South Shore's debt (see PNC Capital Recovery v Mechanical Parking Sys.,283 AD2d 268, 270 [2001]). Here, the plaintiff made out its prima facie case for summaryjudgment against the individual defendants through the sworn affidavit of Connie Roman, itslitigation coordinator.
Roman averred that when the individual defendants first returned the executed equipmentschedule/guaranty by facsimile, the individual defendants had signed on their respectivesignature lines but handwrote beneath them, their respective corporate titles. Roman averred thatupon receipt of these faxed copies, the individual defendants were apprised that the documentneeded to be re-executed as it was not acceptable for them to sign the guaranty in their corporatecapacities. Roman further averred that later the same day, in response, a re-executed equipmentschedule/guaranty signed by the individual defendants but without their corporate titles was sentby fax from South Shore to the plaintiff. Attached to Roman's affidavit were copies of the twofaxes bearing date and time stamps indicating that the first fax, which was unacceptable to theplaintiff, was sent at 11:47 on August 1, 2002, and the second fax was sent the same day at17:18. Notably, the first fax contained a total of seven pages and included, in addition to theequipment schedule/guaranty, the other documents that comprised the lease, such as the masterlease and payment schedule while the later fax was only of the two-page equipmentschedule/guaranty.
Based on the foregoing submissions, the plaintiff established prima facie that the partiesintended that the individual defendants were to be personally liable for South Shore's obligationsunder the lease (cf. Salzman Sign Co. v Beck, 10 NY2d 63, 67 [1961]). Unlike "asituation wherein [a] plaintiff attempted to trap an unwary corporate officer into making anunintended assumption of personal liability by inserting an obscure clause in the midst of alengthy and complex contract," the guaranty at bar is on a separate page, unambiguous and not,for example, a single sentence embedded within the contract (Florence Corp. v PenguinConstr. Corp., 227 AD2d 442, 443 [1996]).
In addition, the lease at bar contains references to both South Shore and the individualdefendants, the former being identified as the lessee thereunder, while the latter are specificallynamed on the signature lines of the guaranty which further references the lessee, identified aboveas South Shore, as the party whose obligations are being guaranteed (see Stuyvesant Plaza vEmizack, LLC, 307 AD2d 640, 640-641 [2003]). Further, an interpretation that theindividual defendants signed the guaranty solely in their capacity as officers of South Shorewould compel the illogical conclusion that the purpose of the guaranty was to provide that in thecase of South Shore's default, South Shore would guaranty its own indebtedness, rendering theentire guaranty meaningless (see generally Two Guys from Harrison-N.Y. v S.F.R. RealtyAssoc., 63 NY2d 396, 403 [1984]).
In opposition, South Shore and the individual defendants failed to raise a triable issue of[*3]fact. Contrary to the contention of South Shore andRomagnolo, the plaintiff is not collaterally estopped from litigating the issue of whether theindividual defendants are liable under the guaranty because that issue was not determined on aprior appeal (see Key Equip. Fin., Inc. vSouth Shore Imaging, Inc., 39 AD3d 595, 597 [2007]). In addition, notwithstanding thesworn statements of the individual defendants proffered in support of their respective motions forsummary judgment, in which they state that they did not intend to be bound personally, thesigned guaranty indicates otherwise. Further, the deposition statements made by RonaldPandolfini and Jason Pandolfini indicating that the guaranty in which they added their corporatetitles was signed after the guaranty which they signed without adding their corporate titles isbelied by the record demonstrating the timing when each version was sent to the plaintiff.
Moreover, even if the plaintiff had accepted the executed version of the equipmentschedule/guaranty on which the individual defendants added their corporate titles, under thecircumstances presented, the individual defendants would not be absolved of personal liabilitysimply by adding their corporate titles to their signatures (see Florence Corp. v PenguinConstr. Corp., 227 AD2d at 443).
Accordingly, the Supreme Court should have granted those branches of the plaintiff's crossmotion which were for summary judgment on the complaint insofar as asserted against theindividual defendants (see Stuyvesant Plaza v Emizack, LLC, 307 AD2d at 641; cf.Star Video Entertainment v J & I Video Distrib., 268 AD2d 423, 424 [2000]).
The remaining contentions of South Shore and the individual defendants either are withoutmerit or need not be reached in light of our determination. Skelos, J.P., Eng, Austin and Roman,JJ., concur. [Prior Case History: 2008 NY Slip Op 32317(U).]