White Oak Commerical Fin., LLC v. Boone

2024 NY Slip Op 31859(U)

• Court: New York Supreme Court, New York County
• Decided: May 20, 2024
• Status: Unpublished

Opinion

White Oak Commerical Fin., LLC v Boone 2024 NY Slip Op 31859(U) May 20, 2024 Supreme Court, New York County Docket Number: Index No. 655842/2023 Judge: Melissa A. Crane Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. INDEX NO. 655842/2023 NYSCEF DOC. NO. 41 RECEIVED NYSCEF: 05/20/2024

SUPREME COURT OF THE STATE OF NEW YORK NEW YORK COUNTY PRESENT: HON. MELISSA A. CRANE PART 60M Justice ----------------------X INDEX NO. 655842/2023 WHITE OAK COMMERCIAL FINANCE, LLC, MOTION DATE 02/20/2024 Plaintiff, MOTION SEQ. NO. 001 - V -

BRUCE S. BOONE, MEREDITH BOONE, S&B TRUST DECISION + ORDER ON MOTION Defendant. ---X

The following e-filed documents, listed by NYSCEF document number (Motion 001) 2, 24, 25, 26, 27, 29, 30, 31, 32 were read on this motion to/for JUDGMENT - SUMMARY IN LIEU OF COMPLAINT.

Upon the foregoing documents, it is

Plaintiff originally filed this motion for summary judgment in lieu of complaint in

November 2023. The individual defendants then filed for bankruptcy in January 2024, and the

court stayed this action (Doc 24 [letter], Doc 28 [order staying case]). The bankruptcy was

dismissed, and the stay was lifted in February 2024 (Doc 29 [letter], Doc 33 [order]). The

individual defendants then filed a successive bankruptcy petition that terminated automatically

on May 15, 2024 (Doc 38 [letter], Doc 40 [bankruptcy order]).

Plaintiffs CPLR 3213 motion is unopposed. None of the defendants have joined issue,

appeared in this case, or submitted any opposition papers.

CPLR 3213 provides for accelerated judgment 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 without regard to extrinsic evidence, "other than simple proof of nonpayment or a

similar de mini mis deviation from the face of the document" (Weissman v Sinorm Deli, Inc., 88

NY2d 437,444 [1996]; see Arbor-Myrtle Beach PE LLC v Frydman, 2021 NY Slip Op. 655842/2023 WHITE OAK COMMERCIAL FINANCE, LLC vs. BOONE SR., BRUCE S. ET AL Page 1 of 4 Motion No. 001

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30223 [U], 2 [Sup Ct, NY County 2021 ], affd 2022 NY Slip Op. 00806 [1st Dept 2022]).

Generally, an action on a guaranty is an action for payment of money only (see e.g. Cooperative

Centrale Raiffesisen-Boerenleenbank, B.A., "Rabobank Intl., "N. Y Branch v Navarro, 25 NY3d

485, 492 [2015]) ("Cooperative Centrale").

The same standards that apply to motions for summary judgment under CPLR 3212

apply to CPLR 3213 motions. Movant must make a prima facie case by submitting the

instrument and evidence of the defendant's failure to make payments in accordance with the

instrument's terms (see Weissman, 88 NY2d at 444; Matas v Alpargatas SA.JC, 274 AD2d

327, 328 [1st Dept 2000]).

Here, the underlying debt arises from the Debtor-in-possession Loan and Security

Agreement entered into by nonparty JJB D.C. Inc. and plaintiff (Doc 7). Plaintiff extended a

revolving credit [up to $13 .5 million] to JJB, and the defendant's guarantied that credit. In

August 2022, the individual defendants executed an Amended and Restated Unlimited General

Performance Guaranty (Doc 5) in plaintiffs favor. Also in August 2022, the trust defendant

I executed a Guaranty in plaintiffs favor (Doc 6). In both guaranties, defendants "unconditionally I

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and absolutely guarantee[ d] to [plaintiff] (A) the due and punctual payment and performance

when due of all Obligations and any and all other monies and amounts due or which may

become due on ... any and all of the Credit Documents" (Doc 5, para 1; see also Doc 6, para 1

[same]). Both guaranties state: "This Guaranty is a guaranty of payment and not a guaranty of

collection" (see id., para 2).

Plaintiff has established that the borrower [JJB] defaulted under the DIP loan

agreement credit agreement and owes plaintiff $12,961,910.73 for unpaid principal (see

Doc 4 [Dean aff.], para 57-62; see also Doc 8 [account statement]). Plaintiff has also

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established that it is entitled to interest at the default rate set forth in the DIP Agreement

from November 1, 2023 until entry of judgment. The DIP Agreement's default rate is

equal to "the sum of (a) the Base Rate then in effect, plus (b) 2.00% per annum" (Doc 7,

pg 9). The "Base Rate" under that Agreement is "an interest rate equal to the sum (a) of

the ABR Index Rate, plus (b) the Applicable Margin in effect from time to time, per

annum" (id., pg 7). The DIP Agreement states:

"ABR Index Rate" means the rate of interest last quoted by The Wall Street Journal as the "Prime Rate" in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Federal Reserve Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the "bank prime loan" rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as reasonably determined by the Lender) or any similar release by the Federal Reserve Board (as reasonably determined by the Lender)"

(Doc 7, pg 7).

The DIP Agreement further states that "Applicable Margin" "means, as of any

date of determination, five percent (5.0%) per annum" (id.). In his affidavit, Dean states

that the Prime Rate at the time of the default was 8.5% (see Doc 4, para 68 ["The Prime

Rate in the United States as quoted by the Wall Street Journal as of October 2023, and

currently, is 8.5%. See The Financial Forecast Center,

https://www.forecasts.org/prime.htm (October 2023); Wall Street Journal, Markets,

https:/ /wv.rw. wsj .com/market-data/bonds/moneyrates (November 2023 ). "]).

Thus, the default rate under the DIP Agreement was 15.5% per annum (8.5% +

5.00% + 2%).

While Plaintiff is also entitled to collect its reasonable attorneys' fees and costs

under the agreements, there is no evidence in the record to demonstrate the amount of

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fees or costs plaintiff has incurred. Accordingly, the request for fees and enforcement

costs is denied.

Accordingly, it is

ORDERED that the motion for summary judgment in lieu of complaint is granted

in part, absent opposition, and the Clerk is directed to enter judgment in favor of plaintiff

and against defendants,jointly and severally, in the amount of$12,961,910.73, together

with interest at the contractual "Default Rate" of 15 .5% from November 1, 2023 until the

date of this decision and order, and thereafter at the statutory rate, as calculated by the

Clerk, together with costs and disbursements to be taxed by the Clerk upon submission of

an appropriate bill of costs; and it is further

ORDERED that the motion is otherwise denied; and it is further

ORDERED that the Clerk is directed to mark this case disposed.

5/20/2024 DATE MELISSA A. CRANE, J.S.C. CHECK ONE: CASE DISPOSED NON-FINAL DISPOSITION

GRANTED □ DENIED GRANTED IN PART □ OTHER APPLICATION: SETTLE ORDER SUBMIT ORDER

CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT □ REFERENCE

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