Tars Uluslararasi Dis Ticaret Turizm ve Sanayi Ltd., Sirketi v Leonard
Annotate this CaseDecided on June 15, 2005
Supreme Court, New York County
Tars Uluslararasi Dis Ticaret Turizm ve Sanayi Limited, Sirketi, Plaintiff,
against
Gerals Leonard, Defendant.
118321/04
Louis B. York, J.
The Motion
Plaintiffs move for summary judgment in lieu of complaint to enforce a promissory note that was executed by defendant, together with legal fees and costs and disbursements. Defendant cross moves to dismiss the complaint under BCL §1312(a), the statue of limitations, accord and satisfaction and lack of legal consideration.
The Statute
BCL §1312(a) bars the bringing of an action in this state where a foreign corporation is not authorized to do business in the state.
The Facts
A)Doing Business
Defendant has claimed that the action should be dismissed or stayed because plaintiffs have not registered, and payed the necessary fees that allows foreign corporations to bring suit in New York. It is undisputed that the corporation is not now doing business in this state. Defendant relies on a statement in the affidavit of Mural Tursuslugil they once sold some goods in New York but that is not sufficient to satisfy the requirement of a systematic and continuous presence in New York under BCL §1312(a). Defendant did not show that plaintiffs maintain an office in New York, receives mail in New York, has a bank account in New York or that it currently engages in commercial transactions in New York - all of which are indicia of regularly doing business in New York (Airline Exchange, Inc. V Bag, 266 AD2d 414, 698 NYS2d 694 [2nd Dept 1999]). Even if defendant was able to establish a basis for satisfying the doing business requirement, dismissal would still not be justified. The statute does not deprive the Court of jurisdiction (Hot Roll Mfg. Co. v Cerrone Equipment Company, 38 AD2d 339, 329 NYS2d 466 [3rd Dept 1972]). It merely brings about a stay of the proceedings until authorization to do business is obtained (Maro Leathers Co. v Aerolineas Argentinas, 161 Misc 2d 920, 601, NYS2d 224[App Term 1st Dept 1993], app dism 85 NY2d 837, cert den US,115 S Ct 1958; Matter of Knoll North America, Inc., 158 Misc 2d 227, 601 NYS2d 224, [Sup Ct NY Cty 1993]). It is also noted that even if the corporation were found to be doing business in the past, there is no evidence that it was doing business when these transactions were being undertaken. That, together with the failure to establish that it is presently doing business in New York, would not cause §BCL 1312(a) to be invoked.
Plaintiffs' allegation that there has been an accord and satisfaction without any corroboration or without the written accord itself, cannot stand up under scrutiny. Defendant [*2]makes the absurd comment that the plaintiffs never expected him to make payment on the promissory note, but only expected payment from defendant's partner, Mr. Birnbaum. This ridiculous comment is barred by the parol evidence rule. Moreover, plaintiffs explain that Birnbaum had a separate obligation which he immediately paid. The Court observes that the note itself, in paragraph eight, states that any waiver must be in writing. Finally, if any additional support of plaintiffs is needed, it is supplied by his Exhibit C to plaintiffs' reply affirmation where the settlement agreement signed by all three individuals recites a payment by Birnbaum of $42,500 by certified check while defendant is delivering his promissory note of $65,000.
B)Lack of Consideration
The note itself states that it was being executed in settlement of prior claims that plaintiffs had against defendant. And, in fact, we know from the settlement agreement itself that the settlement agreement and the note were executed to guarantee that payment of the $65,000 owed by plaintiffs was being covered by these two documents. This forbearance on defendant's debt constitutes consideration.
C)Statute of Limitations Defense
Interest payments were to be paid during the first two years of the note's existence. No payments were made during that time. When, as occurred in this action, the defendant who defaulted in all interest payments due, on December 31, 1996, plaintiffs sent notification that the entire amount under the acceleration clause in the note was accelerated and, therefore, due.
From the parties submissions, it appears that all of the interest payments had been defaulted by December 31, 1996, except the one due on December 31, 1996. Plaintiffs, therefore, are entitled to the principle amount, together with the last interest amount that was due on December 31, 1996, the day that plaintiffs called in the entire loan. This amounts to $65,000 plus the payment of the last interest payment of 7.5% of $65,000 or $4,875.
Except for the December 31, 1996 interest payment, plaintiffs are not entitled to interest payment that accrued in the preceding months. The statute of limitations bars recovery of those interest payments that became due more than six years prior to the filing of the summons and complaint. See, Phoenix Acquisition Corp. v Campore, Inc., 81 NY2d 138, 141, 596 NYS2d 752, 753 [1993]; see also, Bayside Fuel Oil and Heating Co., 133 AD2d 658, 660, 519 NYS2d 832, 834 [2nd Dept 1987]).
The Court has examined defendant's remaining claims and finds them to be without merit. Accordingly, it is
ORDERED and ADJUDGED that plaintiffs shall recover from defendant the sum of $69,875 together with statutory interest in the amount of $________________ from December 31, 1996 in the amount of $__________________ as calculated by the clerk with costs of $________________ as taxed by the clerk, amounting in all to the sum of $_____________.
Dated: June 15, 2005Enter:
_______________________
Louis B. York, J.S.C.
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