Summary
holding that, where the underlying suit was "essentially in the nature of breach of contract," "the respondents' tender of [late contract] payment after the commencement of litigation did not defeat the petitioner's statutory rights under CPLR 5001 because she accepted the tender without prejudice to her claim for interest"
Summary of this case from Viking Pump, Inc. v. Century Indem. Co.Opinion
Argued June 6, 2000
August 15, 2000.
In a proceeding pursuant to SCPA 2103 to discover property withheld from a decedent's estate, the petitioner appeals from so much of an order of the Surrogate's Court, Westchester County (Emanuelli, S.), dated December 1, 1998, as granted that branch of the cross motion of Alan Schwartz and Schwartz, Weiss, Steckler, Hoffman Hade, P.C., which was for partial summary judgment dismissing the cause of action to recover accrued interest upon a sum due to the decedent for breach of contract.
Stroock Stroock Lavan, LLP, New York, N.Y. (Kevin L. Smith and Deborah L. Goldstein of counsel), for appellant.
Dershowitz Eiger, P.C., New York, N.Y. (Victoria B. Eiger and Nathan Z. Dershowitz of counsel), for respondents.
Before: DAVID S. RITTER, J.P., WILLIAM C. THOMPSON, GABRIEL M. KRAUSMAN, GLORIA GOLDSTEIN, JJ.
DECISION ORDER
ORDERED that the order is reversed insofar as appealed from, on the law, with costs, that branch of the cross motion which was for partial summary judgment dismissing the cause of action to recover accrued interest is denied, and that cause of action is reinstated.
On September 15, 1989, the decedent, a prominent attorney, entered into an agreement with the respondents which required them to employ him for a period of four years at a monthly salary, and to reimburse him for certain office expenses. It is undisputed that the respondents failed to make all of the payments due under the agreement, and at the time of the decedent's death in June 1996, the respondents owed him the principal sum of $ 1,043,353.74. The petitioner, as executrix of the decedent's estate, subsequently commenced this proceeding seeking, inter alia, to recover the principal sum due under the agreement plus accrued interest. After the commencement of the proceeding, the respondents tendered payment of the outstanding principal balance, which the petitioner accepted without prejudice to her claim for accrued interest.
On appeal, the petitioner contends that the Surrogate's Court erred in dismissing her claim for interest on the principal sum that the respondents owed the decedent for salary and office expenses. We agree. Since the petitioner's claim against the respondents is essentially in the nature of breach of contract, she has a statutory right to an award of interest pursuant to CPLR 5001(a) (see, Ogletree, Deakins, Nash, Smoak Stewart v. Albany Steel, 243 A.D.2d 877; Hudson View Assocs. II v. Gooden, 222 A.D.2d 163, 168; Matter of Kummer, 93 A.D.2d 135, 183). Moreover, the respondents' tender of payment after the commencement of litigation did not defeat the petitioner's statutory rights under CPLR 5001 because she accepted the tender without prejudice to her claim for interest (cf., Grossman v. Pendant Realty Corp., 221 A.D.2d 240). Accordingly, the petitioner's cause of action for accrued interest should be reinstated, and the amount of interest to which she is entitled must be fixed by the Surrogate's Court upon the issuance of a final decree in this proceeding.