Summary
The Appellate Division, Second Department reviewed an order denying the plaintiff's motion for summary judgment on liability under a personal guaranty for a commercial lease. The court determined that the guaranty was absolute and unconditional, and the defendant failed to raise a triable issue of fact regarding the tenant's default or the validity of the lease modification. Accordingly, the court modified the lower court's order to grant summary judgment on liability and remanded the matter for an inquest to determine damages, costs, and attorneys' fees.
Topics
Practice areas
Questions Presented
- Whether the plaintiff is entitled to summary judgment on liability under the personal guaranty.
Holdings
- The Appellate Division vacated the trial court's denial of summary judgment, granted summary judgment in favor of the plaintiff on liability, and remanded for a damages inquest.
Key quotations
“"A guaranty is a promise to fulfill the obligations of another party, and is subject to the ordinary principles of contract construction" (Cooperatieve Centrale Raiffeisen-Boerenleenbank, B.A., "Rabobank Intl.," N.Y. Branch v Navarro, 25 NY3d 485, 492).” (at 1)
“"On a motion for summary judgment to enforce a written guaranty, all that the creditor need prove is an absolute and unconditional guaranty, the underlying debt, and the guarantor's failure to perform under the guaranty" (H.L. Realty, LLC v Edwards, 131 AD3d 573, 574).” (at 1)
Factual background
In 1999 Almark Holding Co. leased commercial space to Amore Pizza. In August 2019 Almark assigned the lease to Pizza147NY, LLC and the tenant signed a modification and a personal guaranty executed by Amir Abbas. The tenant failed to pay rent for over a year, prompting Almark to sue Abbas on the guaranty.
Procedural history
The plaintiff sued the guarantor on a personal guaranty arising from a lease modification. The trial court denied summary judgment, finding factual issues. The plaintiff obtained summary judgment in a related proceeding, then sought reargument of the summary‑judgment motion in this case. The trial court again denied it. The appellate division reviewed and modified the order.
Remand instructions
Matter remitted to the Supreme Court, Nassau County, for an inquest to determine the amount of damages, costs, and attorneys' fees owed to the plaintiff pursuant to the personal guaranty.