Diesel Funding, LLC v. Build Retail, Inc.

Summary

The Appellate Division, Second Department affirmed an order denying defendants' motion to vacate a judgment and stipulation of settlement arising from a receivables-purchase agreement. The court held that defendants failed to establish that the transaction was a usurious loan, emphasizing the agreement's reconciliation provision, variable payment amounts tied to receivables, nonfinite term, and lack of a bankruptcy-default provision. The court also enforced the settlement stipulation and its default-judgment provision.

Holdings

1. The stipulation of settlement was an enforceable contract, and because defendants undisputedly failed to comply with its terms, Diesel Funding was entitled under the stipulation to enter judgment for the specified settlement amount plus fees, interest, costs, and disbursements without further notice or application to the court.
2. Defendants failed to establish that the transaction was a usurious loan because repayment was contingent on future receivables rather than absolutely due under all circumstances.

Questions Presented

1. Whether the defendants were entitled to vacatur of the judgment and settlement stipulation because the receivables-purchase agreement was an unenforceable usurious loan.
2. Whether the settlement stipulation was enforceable according to its terms and authorized entry of judgment following defendants' default.
3. Whether defendants' remaining appellate contentions warranted reversal.

Disposition

affirmed