| Sanchez de Hernandez v Bank of Nova Scotia |
| 2010 NY Slip Op 06754 [76 AD3d 929] |
| September 30, 2010 |
| Appellate Division, First Department |
| Rita Maria Sanchez de Hernandez et al.,Appellants, v Bank of Nova Scotia, Respondent. |
—[*1] Sullivan & Cromwell LLP, New York (Philip L. Graham, Jr. of counsel), forrespondent.
Order, Supreme Court, New York County (Richard B. Lowe, III, J.), entered August 21,2009, which granted defendant bank's (BNS) motion to dismiss plaintiffs' complaint as barred bythe statute of limitations, unanimously affirmed, with costs. Appeal from oral ruling, same courtand Justice, rendered November 13, 2008, which denied plaintiffs leave to file an amendedcomplaint, unanimously dismissed, without costs, as taken from a nonappealable paper. Appealfrom order, same court and Justice, entered on or about September 11, 2008, which, insofar asappealed from as limited by the briefs, granted defendant's motion to dismiss, for failure to statea cause of action, plaintiffs' claims for unjust enrichment and imposition of a constructive trust,unanimously dismissed, without costs, as untimely.
Plaintiffs are Mexican citizens who, along with other Mexican citizens, were shareholders ina financial company (herein GFI/Inverlat) that, in 1994, during the economic crisis in Mexico,was unable to collect on and repay loans, resulting in the need for additional capital to satisfyregulatory requirements. In December 1995, the Mexican government lent GFI/Inverlat 6.5billion pesos (approximately US $857.5 million), taking in return 99.0349% of GFI/Inverlat'sshares through the government agency Fondo Bancario de Proteccion al Ahorro (FOBAPROA), atrust created to support distressed financial institutions. At about the same time, BNS paid $175million for 10% of GFI/Inverlat's stock and for bonds that could be converted into an additional45% of the stock in the future. Ultimately, through a series of agreements, BNS acquired 91% ofGFI/Inverlat's shares, leaving plaintiffs with 9% of the stock. The gravamen of plaintiffs'complaint, filed in May 2006, is that, pursuant to certain contractual undertakings referred to asguidelines, they were entitled to receive stock in GFI/Inverlat and that BNS breached theguidelines by providing false information to the accounting firm that reported to the Mexicangovernment in March 2000 with respect to the collection of troubled loans, causing the Mexicangovernment to deliver less GFI/Inverlat stock to plaintiffs than BNS knew they were entitled toreceive.[*2]
Plaintiffs' contract claim is barred by the six-year statuteof limitations (CPLR 213 [2]). Contrary to plaintiffs' argument, the limitations period did notbegin to run in January 2004 when the Mexican government declared plaintiffs eligible to receivea 9% share, but in March 2000 when, as plaintiffs allege, BNS breached the guidelines byproviding the false information (see Ely-Cruikshank Co. v Bank of Montreal, 81 NY2d399, 402 [1993]). "Knowledge of the occurrence of the wrong on the part of the plaintiff is notnecessary to start the Statute of Limitations running in a contract action" (id. at 403[internal quotation marks and brackets omitted]). No injustice appears, even accepting thatplaintiffs did not know of the breach until after they were declared eligible for only 9% of thestock in 2004, as plaintiffs do not explain why they did not file a complaint at that time, whichwas well within the six-year period (see id. at 404). Nor does it avail plaintiffs to arguethat defendant, after supplying false information in March 2000, continuously breached itsobligations thereafter by "failing to supply accurate collections information" and "allowing theGovernment to act on that false information," without identifying a more recent, affirmativebreach that occurred within the limitations period (see Airco Alloys Div. v Niagara MohawkPower Corp., 76 AD2d 68, 80 [1980]). Plaintiffs' contention that the statute of limitations ontheir contract claim did not begin to run until "after July 31, 2000," at the end of the measuringperiod under the guidelines for determining losses from troubled loans, is raised for the first timeon appeal, and in any event unavailing. It appears that the formula utilized to determine plaintiffs'entitlement to purchase additional shares was "measured by GFI losses covered byFOBAPROA" (emphasis added), which covered losses only to December 31, 1999. As aresult, at the time the accounting firm issued its final report in March 2000, the calculation ofplaintiffs' entitlement to additional equity was not going to change, even if the results were notissued until on or after July 31, 2000.
The motion court's denial, during oral argument, of plaintiffs' motion for leave to amend, isnot appealable. No appeal lies from a ruling (Matter of Grisi v Shainswit, 119 AD2d 418,420 [1986]), and the transcript was not "so ordered" by the court (CPLR 5512 [a]; 2219 [a]; see Nam Tai Elecs., Inc. v UBSPaineWebber Inc., 46 AD3d 486, 487 [2007]). Plaintiffs' September 21, 2009 appealfrom the order that was entered on or about September 11, 2008 and served with notice of entryon or about October 17, 2008 is untimely (CPLR 5513 [a]). Concur—Andrias, J.P., Saxe,Sweeny, Nardelli and Catterson, JJ.