Opinion
Index No. 503360/2023 Motion Seq
08-01-2023
TBG FUNDING LLC, Plaintiff, v. ANTHONY BIRKLA, BIRKLA INVESTMENT GROUP, LLC, AND CINCINNATI DEVELOPMENT III LLC, Defendants,
Unpublished Opinion
PRESENT: HON. LEON RUCHELSMAN, JUDGE
DECISION AND ORDER
LEON RUCHELSMAN, JUDGE
The plaintiff has moved seeking summary judgement pursuant: to CPLR §3212 that there are no questions of fact the defendants owe the money sought in the complaint. The defendants oppose the motion. Papers were submitted by the parties and after reviewing all the arguments this court now makes the following determination.
According to the complaint, on August 1, 2018 the plaintiff TBG loaned funds to non-party Cincinnati Terrace Associates LLC. The loan was secured by a mortgage on property located at 15 W. Sixth street, Cincinnati, Ohio. On June 9, 2021 Cincinnati Terrace declared bankruptcy and pursuant to that bankruptcy an auction of the property was conducted and the plaintiff was entitled to credit bid the amount of its debt. The plaintiff assigned its rights to the credit bid to an entity called Hamilton Land Reutilization Corporation [hereinafter HLRC] pursuant to an agreement dated August 8, 2022. Pursuant to that agreement, as relevant here, HLRC was required to pay one million dollars within forty-five days of September 22, 2022. That payment was guaranteed by the defendants pursuant to a guaranty executed August 8, 2022. The complaint alleges the payment was never made and instituted this action seeking recovery of that payment. The complaint alleges breach of contract causes of action against Birkla Investment Group LLC and Anthony Birkla individually. The plaintiff has now moved seeking summary judgement arguing there are no questions of fact the defendants owe the money pursuant to the guaranty. As noted, the motion is opposed.
Conclusions of Law
Summary judgment may be granted where the movant establishes sufficient evidence which would compel the court to grant judgment in his or her favor as a matter of law (Zuckerman v. City of New York, 49 N.Y.2d 557, 427 N.Y.S.2d 595 [1980]). Summary Judgment would thus be appropriate where no right of action exists foreclosing the continuation of the lawsuit.
It is well settled that a motion for summary judgment should, not generally be granted before any discovery has taken place (Fazio v. Brandywine Realty Trust, 29 A.D.3d 939, 815 N.Y.S.2d 470, [2d Dept., 2006]). This is especially true where discovery is necessary to ascertain whether the plaintiff can establish the contentions found in the complaint and whether the defendant can establish any valid defenses (See, generally, Manufacturer's and Trader's Trust Company v. Norfolk Bank, 16 A.D.3d 467, 791 N.Y.S.2d 599 [2d Dept., 2005]). Thus a summary judgment motion filed prior to any discovery should be denied as premature (Amico v. Meliville Volunteer Fire Company Inc., 39 A.D.3d 784, 832 N.Y.S.2d 813 [2d Dept., 2007]) with leave to renew following the completion of all discovery (Zafarani v. Salton/Maxim Housewares, Inc., 18 A.D.3d 651, 795 N.Y.S.2d 633 [2d Dept., 2005]).
In this case, however, the defendants do not deny the existence of the debt. Rather, they argue that there are questions of fact that foreclose summary judgement without any discovery. Specifically, they assert Paragraph 8(b) of the assignment agreement is ambiguous and thus summary judgement is inappropriate. Paragraph 8(b) states that the assignee (HLRC) must pay one million dollars "in immediately available funds by wire transfer in accordance with the Wire Instructions on the earlier of (i) the date that Assignee submits a subsequent deed from the one it received out of the Bankruptcy Litigation pursuant to its rights to close on the Credit Bid and transferring title to the Property to CDIII or its designee; and (ii) forty-five days after the Assignment Date" (see, Assignment of Bid Agreement, ¶8 (b) [NYSCEF Doc. No. 2]).
The defendants argue the phrase "immediately available funds" is not defined and is therefore ambiguous. Defendants assert that "defendants understood that Plaintiff's compliance with ¶ 8(b) of the Assignment Agreement hinged on the funds resulting from the disposition of the related Bankruptcy Litigation being immediately available... However, through no fault of Defendants, there was an unforeseen delay in the Bankruptcy Litigation, which forestalled the availability of necessary funds from both private financing and a City of Cincinnati Tax Increment Financing package tied to this distressed property" (see, Memorandum in Opposition, page 5 [NYSCEF Doc. No. 29]).
Thus, the true basis for the opposition, is not rooted in any ambiguity in the clearly unambiguous phrase 'immediately available funds'. Rather, the defendants argue the funds were not immediately available because a delay in the bankruptcy proceeding delayed their access to the necessary funds. The defendants fail to explain how the inability to pay the amount when due is any different than any failure to pay a debt when due because of insufficient funds. The failure to maintain the necessary funds, whatever the reason, does not raise any questions of fact the money is due. Further, the mere fact the delay happened in the very bankruptcy proceeding that was intended to be the source of funds does not mean there are questions of fact. The defendants agreed to pay one million dollars pursuant to the terms of the assignment agreement and they failed to so. There are no issues presented which can raise any questions of fact regarding the money owed. Therefore, a prima facie showing sufficient for summary judgment is made by submitting proof of an underlying agreement, the personal guaranty of the obligations under that agreement, and the failure to make payment in accordance with the terms of the agreement (HSBC Bank USA, N.A. v. Laniado, 72 A.D.3d 645, 897 N.Y.S.2d 514 [2d Dept 2010]). Therefore, there is no discovery necessary which could possibly raise any questions of fact. Consequently, based on the foregoing, the motion seeking summary judgement is granted.
So ordered.