Summary Judgment In Lieu Of Complaint Granted Under CPLR 3213

On April 17, 2024, Justice Melissa A. Crane granted summary judgment on a note under CPLR 3213, in TVAE Invs. LLC v. Cannetti, Index No. 656186/2023.

CPLR 3213 allows for an expedited process whereby plaintiff can commence an action by moving for summary judgment, rather by filing a complaint and undertaking discovery, upon proof of nonpayment where the instrument sued upon is for the payment of money only and the right to payment can be ascertained from the face of the document.

On or about July 6, 2020, defendant Nicolas James Cannetti ("Cannetti") signed a note promising that RENOED Construction, LLC (“RENOED”) would pay $500,000 to plaintiff TVAE Invs. LLC (“TVA”) by July 5, 2022. Cannetti signed the note in his capacity as Manager of RENOED, which was identified as the borrower.

On January 2, 2023, after several extensions of the payment date, Canetti returned a signed copy of an “Amended Note” to TVAE. The Amended Note called for payment of the $500,000, together with defined interest, by no later than July 27, 2023. It identified Cannetti as the borrower, but the word “President” appears after his name on the signature block.

After the Amended Note’s payment date passed without payment and TVAE and Cannetti had engaged in unsuccessful negotiations, TVAE brought the action, against Cannetti, under CPLR 3213 for summary judgment on the Amended Note.

In opposition, Cannetti argued that RENOED, not he, was the sole borrower. The Court rejected that contention, citing First Department cases holding that "This Court has consistently held that where there is evidence that a person signed . . . as an individual and not on behalf of a corporation, the inclusion of ‘president’ after his signature is merely descriptive" (PNC Capital Recovery v Mech. Parking Sys., Inc., 283 A.D.2d 268, 271 (1st Dept 2001)) and that the “addition of word ‘Pres’ after signature [is] merely descriptive, [and] does not affect liability under personal guaranty” (Chemical Bank v. Masters, 176 AD2d 591 (1st Dept. 1991)). TVAE Invs. LLC, p. 5.

TVAE’s application for interest accrued under the First Note prior to execution of the Amended Note was denied. The Amended Note called for interest only after the date of its execution (which was allowed), and defined the principal obligation as $500,000, without providing for any interest that may have accrued under the First Note. Id. at 6.

The attorneys at Schlam Stone & Dolan frequently litigate cases involving the enforcement of notes, under CPLR 3213 and otherwise. Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning such issues.