Sterling Natl. Bank v Chang

[*1] Sterling Natl. Bank v Chang 2005 NY Slip Op 51986(U) [10 Misc 3d 131(A)] Decided on December 7, 2005 Appellate Term, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on December 7, 2005
APPELLATE TERM OF THE SUPREME COURT, FIRST DEPARTMENT
PRESENT: DECEMBER 7, 2005 SUPREME COURT, APPELLATE TERM, FIRST DEPARTMENT November 2005 Suarez, P.J., Davis, Schoenfeld, JJ.
570513/05

Sterling National Bank, as assignee of Norvergence, Inc., Plaintiff-Appellant, Calendar No. 0

against

Kenneth H. Chang, P.S., and Kenneth H. Chang, individually, Defendant-Respondent.

Plaintiff appeals from an order of the Civil Court, New York County (Ellen Gesmer, J.), dated March 22, 2005, which denied its motion for summary judgment and to strike defendant's affirmative defenses.

PER CURIAM:

Order, (Ellen Gesmer, J.), dated March 22, 2005, affirmed, with $10 costs.

In this action for recovery under what is known as a "hell or high water" clause of an equipment lease, triable issues of fact exist as to alleged fraud in the inducement by the original lessor, and plaintiff's alleged knowledge or notice of such fraud (see Wells Fargo Bank v Stargate Films, 18 AD3d 264 [2005]; Norwest Fin. Leasing v Parish of St. Augustine, 251 AD2d 125 [1998]), which would adversely affect plaintiff's standing as a holder in due course of the assigned lease (UCC 3-305[2][c]). Plaintiff failed to offer an affidavit by anyone with personal knowledge of the original transaction that might bear on resolution of these issues. Similarly, the forum-selection clause in the lease is subject to challenge where a defendant can demonstrate it is invalid because of fraud or overreaching, or that its enforcement would be unreasonable or unjust (see British W. Indies Guar. Trust Co. v Banque Internationale A Luxembourg, 172 AD2d 234 [1991]).

This constitutes the decision and order of the Court.
Decision Date: December 07, 2005