Overseas Private Inv. Corp. v Nam Koo Kim
Annotate this CaseDecided on May 19, 2009
Supreme Court, Albany County
Overseas Private Investment Corporation, Plaintiff,
against
Nam Koo Kim AND HEE SUN KIM, Defendants.
8786-08
Linda T. Taverni, Esq.
Attorney for Plaintiff
826 Atateka Drive
Chestertown, New York 12817
Girvin & Ferlazzo, P.C.
Attorneys for Defendants
(Salvatore D. Ferlazzo, Esq., of Counsel)
20 Corporate Woods
Albany, New York 12211
Michael C. Lynch, J.
Plaintiff has moved for summary judgment seeking recovery under a promissory note executed by defendant Nam Koo Kim and a guarantee of payment executed by defendant Hee Sun Kim.
Summary judgment is a drastic remedy which should only be granted when it is clear that there are no triable issues of fact (see Andre v Pomeroy, 35 NY2d 361, 364 [1974]). "[T]he proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact" (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]; see also Bush v St. [*2]Clare's Hosp., 82 NY2d 738, 739 [1993]). Once the movant has established a right to judgment as a matter of law, the burden shifts to the opponent of the motion to establish, by admissible proof, the existence of genuine issues of material fact (see Zuckerman v City of New York, 49 NY2d 557 [1980]). Such proof must contain evidentiary detail. "[C]onclusory assertions will not defeat summary judgment." (Freedman v Chemical Constr. Corp., 43 NY2d 260, 264 [1977]). In general, the Court will then view the evidence in a light most favorable to the party opposing the motion, giving that party the benefit of every reasonable inference, and determine whether there is any triable issue of fact (see Boyce v Vazquez, 249 AD2d 724, 726 [1998]; Martin v Briggs, 235 AD2d 192, 196 [1997]; Simpson v Simpson, 222 AD2d 984, 986 [1995]).
Plaintiff has submitted proof of a promissory note executed by defendant Nam Koo Kim and a guarantee of all payments due under such note executed by his wife, defendant Hee Sun Kim. The note constitutes a restructuring of a previous note which was in default and which was executed by a corporation of which Nam Koo Kim is the principal. Defendant Hee Sun Kim executed personal guarantees of both notes. Plaintiff has also submitted proof of a default under the second note. Plaintiff seeks recovery of the accelerated note payments, together with interest and an award of attorneys fees. Plaintiff's submissions constitute a prima facie showing of a right to summary judgment (see Two Lincoln Advisory Servs. v Shields, 293 AD2d 740, 741 [2002]; 20 East 17th Street LLC v 4 M Dev. Co., 246 AD2d 341, 342 [1998]; Bercy Investors v Sun, 239 AD2d 161 [1997]).
Defendants do not contest execution of the note or the signature page of the guarantee or default in payment thereunder. Rather, Hee Sun Kim alleges that plaintiff only provided her with the signature page and did not provide her with all of the original loan and guarantee documents, that she had agreed only to provide a security interest in real property in Virginia owned solely by her, that plaintiff may have substituted different pages for those originally presented to the defendants and that there is an illegible note on one page of the copy of the guarantee submitted by plaintiff.
Defendant Hee Sun Kim alleges that plaintiff mailed her only the signature page of each guarantee. However, she admits having signed the signature pages of both guarantees. Both such signature pages clearly and unequivocally provide that Hee Sun Kim is executing the document as a guarantor in favor of plaintiff. Moreover, each such page clearly indicates that it is page 10 of a multi-page document. She has also alleged that her husband, defendant Nam Koo Kim, was the one who dealt with plaintiff in negotiating and executing the loan. Nam Koo Kim's affidavit in opposition to the motion alleges that he was actively involved in all transactions for this loan. He has not alleged that the full text of the guarantees was not provided to him and thus constructively to his wife. Moreover, defendant Hee Sun Kim is bound by the terms of the document she signed even if she did not read it (see Maines Paper & Food Serv. v Adel, 256 AD2d 760 [1998]; Lewin Chevrolet-Geo-Oldsmobile v Bender, 225 AD2d 916 [1996]). There is no indication that she sought to obtain the full document from plaintiff or her husband or that it was not available upon a simple inquiry. In short, defendants can not invalidate the guarantee upon which plaintiff relied in granting the loans by the simple expedient of alleging that the guarantor was not provided the entire agreement by her co-defendant husband. She has also failed to offer any proof that plaintiff was aware that she did not have the entire agreement available. The email upon which she relies requests that she execute the guarantee agreement, [*3]implying that she execute the entire agreement. The fact that plaintiff only requested that she return the signature page does not give rise to any additional inference.
Defendant Hee Sun Kim further alleges that she only agreed to provide a security interest in real property in Virginia and never intended to grant a personal guarantee. She has not provided any documentary support for such conclusory assertions, nor does the affidavit from her husband contain any evidentiary detail with respect to an agreement for such limited security for the loan. She has also alleged that she never discussed the terms of the guarantee with anyone from plaintiff. No reasonable basis for her belief as to the limited nature of the agreement is set forth. Furthermore, the contract documents specifically contemplate defendant Hee Sun Kim executing a deed of trust to plaintiff, as well as the personal guarantee. Indeed, such a document or a mortgage would be the method of effectuating the alleged security agreement. There is no explanation of why Hee Sun Kim also executed a document which clearly indicated that it was a guarantee, rather than a mortgage or deed of trust, if the agreement was limited to a security interest in the real property. In addition, the first guarantee related to the initial note was executed by both defendants. There is no explanation of why Nam Koo Kim would have executed a document granting a security interest in real property which he did not own.
To the extent that defendant Hee Sun Kim alleges fraud by plaintiff, she has alleged that she never spoke to anyone from plaintiff prior to executing the guarantee. As such, she has failed to allege any misrepresentation by plaintiff. Moreover, even if she had alleged a misrepresentation, the written agreement precludes any possibility of justifiable reliance (see Lewin Chevrolet-Geo-Oldsmobile v Bender, 225 AD2d at 918; Baltzly v Sandoro, 186 AD2d 1077 [1992]). Since defendants' assertions contradict the writing executed by defendant Hee Sun Kim they are insufficient to raise any issue of fact.
Defendants also point to certain inconsistencies in the documents such as the fact that only certain pages contain the notation "execution version." Defendants speculate that plaintiff may have substituted pages within the final version. There is, however, no factual support for such claim. It is again noted that defendants have alleged that Nam Koo Kim was involved in all aspects of the negotiations. There is no proof from said defendant alleging in evidentiary detail that the documents submitted on the motion have been altered or that they do not accurately reflect the final agreement of the parties.
Defendant Hee Sun Kim also points out that there are " unreadable margin notes on page 6" of the "Amended and Restated Guaranty" (annexed to the complaint as Exhibit "D") and seeks discovery to confirm the authenticity of the document (see affidavit of Hee Sun Kim at paragraph 16). Defendant fails to establish how the margin note raises an issue of fact with respect to the enforceability of the guarantee. The note appears adjacent section 7[d] of the document, which precludes guarantor from allowing new liens to accrue against real property in Virginia utilized as collateral for the transaction. While the note is unreadable, the guaranty language of the document otherwise remains intact.
Finally, defendants contend that further discovery is necessary to oppose the motion. It is well settled that in order successfully to oppose a motion for summary judgment on the ground that additional discovery is needed pursuant to CPLR § 3212 (f), defendants must make an evidentiary showing that facts essential to justify opposition may exist but can not as yet be stated. Speculation or conjecture are not sufficient to warrant a stay of the motion (see Mitchell [*4]v Atlas Copco N. Am., 307 AD2d 635 [2003]; Green v Covington, 299 AD2d 636 [2002]; Firth v State of New York, 287 AD2d 771, 773 [2001] affd 98 NY2d 365 [2002]). Defendants have failed to offer any evidence that there are any issues within the exclusive knowledge of plaintiff relevant to liability on the note and the guarantee. Defendant Nam Koo Kim has not offered any evidentiary showing of any alteration in the contract documents. He has not even alleged that he is not in possession of copies of the original documents. To the contrary, he has alleged that he was involved in all aspects of the loan transactions and as such already has personal knowledge of the negotiations and terms of the agreements. Given such knowledge, the request for discovery is based entirely upon speculation and conjecture. As such, defendants have not made a sufficient showing that discovery is likely to yield any evidence supporting a valid defense herein. It is therefore determined that plaintiff is entitled to summary judgment on the issue of liability against the defendants on the note and guarantee.
Defendant Nam Koo Kim has submitted proof of payments on the note in the amount of $352,710.57. He has also submitted correspondence from plaintiff indicating that as of August 22, 2008 the amount due on the note was $1,158,126.92, considerably less than the $1,427,088.29 in principal sought herein. A review of the "Restructured Loan and Assumption Agreement" indicates that the past due interest on the first note was not rolled over into principal on the restructured note. However, such agreement provides that the predominately interest payments required almost immediately after execution of the note in the total amount of $162,583.79 include the overdue maintenance fee and legal fees, amounting to $17,000.00, which were included in the principal amount of the note. Plaintiff has not offered any basis for its computation of the amount due and has not shown that the $17,000.00 was credited toward principal as required by the agreement. In addition, defendant Nam Koo Kim has shown an additional payment of $170,000.00 which was made after the alleged default. The schedule of payments under the note indicates that as of the date of such payment, there were six monthly interest payments due in the amount of $10,063.39 and one due in the amount of $9,289.29. Defendant has offered proof of payment of two monthly interest charges in the total amount of $20,126.78. As such, past due interest as of the date of the $170,000.00 payment would have amounted to at most $49,542.85. Defendants have thus offered proof of payments against principal in the amount of at least $137,457.15. It is also noted that the correspondence submitted by plaintiff with respect to a waiver and deferral of payments appears to indicate that all but one of the interest payments in the amount of $10,063.39 were made, which would increase principal payments by in excess of $30,000.00. Plaintiff's conclusory assertions of the amount due appear to have credited defendants with only $89,911.80 in principal payments. Moreover, such calculations are entirely inconsistent with the August, 2008 statement of the amount due. Defendants have therefore shown the existence of a triable issue of fact with respect to the amount due under the note and guarantee.
The note and guarantee provide that defendants will be responsible for any collection costs, including attorneys fees. However, given the above determination, it is almost certain that additional attorneys fees will be incurred in prosecuting this action. As such, an award at this time would be premature.
Accordingly, plaintiff's motion for summary judgment is hereby granted in part on the issues of liability for payment of the note against defendant Nam Koo Kim, liability under the [*5]guarantee against defendant Hee Sun Kim and liability for attorneys fees against both defendants. The motion is otherwise denied. This matter is scheduled for a conference to be held in chambers on June 15, 2009 at 10:00 a.m. for purposes of scheduling an inquest.
This Memorandum constitutes the Decision and Order of the Court. All papers including this Decision and Order are returned to the attorney for plaintiff. The signing of this Decision and Order shall not constitute entry or filing under CPLR Rule 2220. Counsel is not relieved from the applicable provisions of that Rule respecting filing, entry and Notice of Entry.
SO ORDERED!
ENTER.
Dated: Albany, New York_______________________________________
May 19, 2009Michael C. Lynch
J.S.C.
Papers Considered:
(1) Notice of Motion dated January 30, 2009;
(2) Affirmation of Linda T. Taverni, Esq. dated January 30, 2009 with exhibits annexed;
(3) Affidavit of Mary Ryan Bequai dated January 28, 2009 with exhibit annexed;
(4) Affidavit of Salvatore D. Ferlazzo, Esq. dated February 18, 2009 with exhibits annexed;
(5) Affidavit of Hee Sun Kim dated February 18, 2009 with exhibits annexed;
(6) Affidavit of Nam Koo Kim dated the blank day of February, 2009 with exhibits annexed;
(7) Reply Affirmation of Linda T. Taverni, Esq. dated February 25, 2009.
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