Spilky v. Atkin

Appellate Division of the Supreme Court of New York

Spilky v. Atkin

120 A.D.2d 581, 502 N.Y.S.2d 68, 1986 N.Y. App. Div. LEXIS 56667

Appellate Division of the Supreme Court of the State of New York·Decided May 12, 1986·Published·Cited by 1 cases

Opinion

— In an action to recover on a guarantee of payment of a note, prosecuted pursuant to CPLR 3213 by motion for summary judgment in lieu of a complaint, the plaintiff appeals from an order of the Supreme Court, Queens County (Hyman, J.), dated November 2, 1984, which denied the motion.

Order affirmed, without costs or disbursements. The plaintiff’s motion papers are deemed the complaint. The defen[582] dant’s time to serve an answer thereto is extended to 20 days after service upon him of a copy of the order to be made hereon with notice of entry.

In addition to his being a party to the agreement creating the obligation secured by the promissory note, the defendant guarantor Benjamin Atkin is also the president and sole stockholder of the corporate principal, thus creating a situation where principal and guarantor are "truly one and the same” (Walcutt v Clevite Corp., 13 NY2d 48, 56). Accordingly, the defendant may properly assert the principal’s defenses in an action on his guarantee (see, Walcutt v Clevite Corp., supra, at pp 56-57). Questions of fact having been raised concerning, inter alia, the propriety of the plaintiff creditor’s liquidation of the corporate assets which were held in escrow, and the defendant’s right to a setoff of the proceeds of such sale, summary judgment was properly denied. Eiber, J. P., Kunzeman, Kooper and Spatt, JJ., concur.

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— In an action to recover on a guarantee of payment of a note, prosecuted pursuant to CPLR 3213 by motion for summary judgment in lieu of a complaint, the plaintiff appeals from an order of the Supreme Court, Queens County (Hyman, J.), dated November 2, 1984, which denied the motion.

Order affirmed, without costs or disbursements. The plaintiff’s motion papers are deemed the complaint. The defen[582] dant’s time to serve an answer thereto is extended to 20 days after service upon him of a copy of the order to be made hereon with notice of entry.

In addition to his being a party to the agreement creating the obligation secured by the promissory note, the defendant guarantor Benjamin Atkin is also the president and sole stockholder of the corporate principal, thus creating a situation where principal and guarantor are "truly one and the same” (Walcutt v Clevite Corp., 13 NY2d 48, 56). Accordingly, the defendant may properly assert the principal’s defenses in an action on his guarantee (see, Walcutt v Clevite Corp., supra, at pp 56-57). Questions of fact having been raised concerning, inter alia, the propriety of the plaintiff creditor’s liquidation of the corporate assets which were held in escrow, and the defendant’s right to a setoff of the proceeds of such sale, summary judgment was properly denied. Eiber, J. P., Kunzeman, Kooper and Spatt, JJ., concur.

Spilky v. Atkin, 120 A.D.2d 581, 502 N.Y.S.2d 68, 1986 N.Y. App. Div. LEXIS 56667 (N.Y. Ct. App. 1986).

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