| Morrison v Zaglool |
| 2011 NY Slip Op 07401 [88 AD3d 856] |
| October 18, 2011 |
| Appellate Division, Second Department |
| Charolette Morrison et al., Respondents, v George F.Zaglool, Appellant. |
—[*1] Thompson Law Group, P.C., New York, N.Y. (Janese Thompson of counsel), forrespondents.
In an action to recover on seven promissory notes, the defendant appeals from an order of theSupreme Court, Suffolk County (Baisley, J.), dated March 4, 2011, which, in effect, denied hismotion pursuant to CPLR 3211 (a) (5) to dismiss the first through fifth causes of action astime-barred.
Ordered that the order is modified, on the law, (1) by deleting the provision thereof, in effect,denying that branch of the defendant's motion pursuant to CPLR 3211 (a) (5) which was todismiss as time-barred the cause of action to recover on the first promissory note, dated March19, 1998, and substituting therefor a provision granting that branch of the motion, (2) by deletingthe provision thereof, in effect, denying that branch of the defendant's motion pursuant to CPLR3211 (a) (5) which was to dismiss as time-barred all causes of action for installment paymentswhich accrued from February 1, 1999, to April 1, 2002, under the second promissory note, datedJanuary 25, 1999, and substituting therefor a provision granting that branch of the motion, (3) bydeleting the provision thereof, in effect, denying that branch of the defendant's motion pursuantto CPLR 3211 (a) (5) which was to dismiss as time-barred all causes of action for installmentpayments which accrued from August 1, 1999, to April 1, 2002, under the third promissory notedated July 1, 1999, and substituting therefor a provision granting that branch of the motion, (4)by deleting the provision thereof, in effect, denying that branch of the defendant's motionpursuant to CPLR 3211 (a) (5) which was to dismiss as time-barred all causes of action forinstallment payments which accrued from October 1, 1999, to April 1, 2002, under the fourthpromissory note, dated September 1, 1999, and substituting therefor a provision granting thatbranch of the motion, and (5) by deleting the provision thereof, in effect, denying that branch ofthe defendant's motion pursuant to CPLR 3211 (a) (5) which was to dismiss as time-barred allcauses of action for installment payments which accrued from July 1, 2001, to April 1, 2002,under the fifth promissory note, dated June 6, 2001, and substituting therefor a provision grantingthat branch of the motion; as so modified, the order is affirmed, with costs to the defendant.
In March 1998 the defendant borrowed $20,000 from the plaintiff R.A.M. Sr. Management,Inc. (hereinafter R.A.M.), and executed a promissory note in R.A.M.'s favor dated [*2]March 19, 1998. The terms of the note provided, inter alia, that itwas to be repaid in equal monthly installments of $515 over a 48-month period, with the firstpayment due on April 1, 1998. In January 1999 the defendant borrowed $13,000 from R.A.M.and executed a promissory note in R.A.M.'s favor dated January 25, 1999. The terms of the noteprovided, among other things, that it was to be repaid in equal monthly installments of $355 overa 48-month period with the first payment due on February 1, 1999. In July 1999 the defendantborrowed $11,000 from R.A.M. and executed a promissory note in R.A.M.'s favor dated July 1,1999. The terms of the note provided, among other things, that it was to be repaid in equalmonthly installments of $218 over a 60-month period with the first payment due on August 1,1999. In September 1999 the defendant borrowed $30,000 from R.A.M. and executed apromissory note in R.A.M.'s favor dated September 1, 1999. The terms of the note provided,inter alia, that it was to be repaid in equal monthly installments of $500 over a 72-month periodwith the first payment due on October 1, 1999. In June 2001 the defendant borrowed $25,000from R.A.M. and executed a promissory note in R.A.M.'s favor dated June 6, 2001. The terms ofthe note provided, inter alia, that it was to be repaid in equal monthly installments of $2,265 overa 12-month period with the first payment due on July 1, 2001. Thereafter, the defendantborrowed further sums of money from the plaintiff Charolette Morrison, and executed twopromissory notes and two guarantees of payment in Morrison's favor. Those notes and guaranteesare not the subject of this appeal.
On April 28, 2008, the plaintiffs commenced this action alleging that the defendant defaultedon all seven promissory notes. In May 2008 the defendant moved pursuant to CPLR 3211 (a) (5)to dismiss the first five causes of action as time-barred. Each of these causes of action sought torecover on the promissory notes executed in R.A.M.'s favor. The Supreme Court, in effect,denied the motion. The defendant appeals. We modify.
For an action to recover on a promissory note, the statute of limitations is six years(see CPLR 213 [2]; Sce vAch, 56 AD3d 457, 458 [2008]). A cause of action to recover on a note which is payableon demand accrues at the time of its execution (see Sce v Ach, 56 AD3d at 458; Comerica Bank, N.A. v Benedict, 8AD3d 221, 222 [2004]). A cause of action to recover on a note which is payable in full atone time accrues at the time it becomes due (see Park Assoc. v Crescent Park Assoc., 159AD2d 460, 461 [1990]). "However, with respect to a note payable in installments, such as the[notes] at bar, there are separate causes of action for each installment accrued, and the statute oflimitations begins to run on the date each installment becomes due and is defaulted upon, unlessthe debt is accelerated" (Sce v Ach, 56 AD3d at 458). Here, the subject notes did notprovide for acceleration of the debt in the event of default. Thus, for each of the five notes atissue on this appeal, the statute of limitations began to run on the date each installment becamedue and was defaulted upon.
Regarding the first note, dated March 19, 1998, the first payment was due on April 1, 1998,and each successive payment was due on the first day of each month thereafter, for a 48-monthperiod. For purposes of the statute of limitations, a cause of action to recover on this firstpromissory note, based on a default in the payment of any one installment due under the note,accrued on the first day of each month of the 48 months at issue, and expired, respectively, sixyears thereafter. The plaintiffs commenced this action on April 28, 2008, so any cause of actionwhich accrued under the note more than six years prior to April 28, 2008, is time-barred. Sincethe payments under the note were to be made on the first day of each month from April 1, 1998,to March 1, 2002, all of the causes of action accrued more than six years prior to April 28, 2008,and therefore were time-barred. Thus, the Supreme Court should have granted that branch of thedefendant's motion pursuant to CPLR 3211 (a) (5) which was to dismiss as time-barred the causeof action to recover on the promissory note dated March 19, 1998.
Regarding the second note, dated January 25, 1999, the first payment was due on February 1,1999, and each successive payment was due on the first day of each month thereafter, for a48-month period. Thus, the payments under the second note were to be made on the first day ofeach month from February 1, 1999, to January 1, 2003. Those causes of action which accruedmore than six years prior to April 28, 2008, were time-barred. The only timely causes of actionwere those which were to recover the unpaid installments from May 1, 2002, through January 1,2003. Therefore, the Supreme Court should have granted that branch of the defendant's motion[*3]pursuant to CPLR 3211 (a) (5) which was to dismiss astime-barred all causes of action which accrued under the second note from February 1, 1999, toApril 1, 2002.
Regarding the third note, dated July 1, 1999, the first payment was due on August 1, 1999,and each successive payment was due on the first day of each month thereafter, for a 60-monthperiod. Thus, the payments under the third note were to be made on the first day of each monthfrom August 1, 1999, to July 1, 2004. Those causes of action which accrued more than six yearsprior to April 28, 2008, were time-barred. The only timely causes of action were those whichwere to recover the unpaid installments from May 1, 2002, to July 1, 2004. Therefore, theSupreme Court should have granted that branch of the defendant's motion pursuant to CPLR3211 (a) (5) which was to dismiss as time-barred all causes of action which accrued under thethird note from August 1, 1999, to April 1, 2002.
Regarding the fourth note, dated September 1, 1999, the first payment was due on October 1,1999, and each successive payment was due on the first day of each month thereafter, for a72-month period. Thus, the payments under the fourth note were to be made on the first day ofeach month from October 1, 1999, to September 1, 2005. Those causes of action which accruedmore than six years prior to April 28, 2008, were time-barred. The only timely causes of actionwere those which were to recover the unpaid installments from May 1, 2002, to September 1,2005. Therefore, the Supreme Court should have granted that branch of the defendant's motionwhich was to dismiss as time-barred all causes of action which accrued under the fourth notefrom October 1, 1999, to April 1, 2002.
Regarding the fifth note, dated June 6, 2001, the first payment was due on July 1, 2001, andeach successive payment was due on the first day of each month thereafter, for a 12-monthperiod. Thus, the payments under the fifth note were to be made on the first day of each monthfrom July 1, 2001, to June 1, 2002. Those causes of action which accrued more than six yearsprior to April 28, 2008, were time-barred. The only timely causes of action were those whichwere to recover the unpaid installments from May 1, 2002, to June 1, 2002. Therefore, theSupreme Court should have granted that branch of the defendant's motion which was to dismissas time-barred all causes of action which accrued under the fifth note from July 1, 2001, to April1, 2002.
The plaintiffs' remaining contentions either are without merit, are raised for the first time onappeal, or have been rendered academic by our determination. Mastro, J.P., Angiolillo, Belen andLott, JJ., concur.