Opinion
15243 Index No. 651808/2 Case No. 2021–03698
02-08-2022
E D & F MAN SUGAR LIMITED, Plaintiff–Respondent, v. George G. GELLERT, Defendant–Appellant.
Westerman Ball Ederer Miller Zucker & Sharfstein, LLP, Uniondale (Jeffrey A. Miller of counsel), for appellant. DLA Piper LLP (US), New York (Joshua A. Kane of counsel), for respondent.
Westerman Ball Ederer Miller Zucker & Sharfstein, LLP, Uniondale (Jeffrey A. Miller of counsel), for appellant.
DLA Piper LLP (US), New York (Joshua A. Kane of counsel), for respondent.
Renwick, J.P., Mazzarelli, Friedman, Singh, Pitt, JJ.
Order, Supreme Court, New York County (Jennifer Schecter, J.), entered September 1, 2021, which, insofar as appealed from as limited by the briefs, denied defendant's motion to stay the action pending determination of a related Romanian action, unanimously reversed, on the law, without costs, and the motion granted.
In March 2021, plaintiff brought this action to recover on a personal guaranty executed by defendant as consideration for a loan by plaintiff to two Romanian companies partly owned by defendant. Two months later, defendant brought suit against the instant plaintiff in Romania, seeking a declaration that the companies’ payment obligations under the underlying loan agreements were not enforceable.
This action should be stayed pending determination of the related Romanian action, because the issues to be decided in the Romanian action are potentially dispositive of this action; there can be no liability for defendant under the personal guaranty if there is no underlying liability for the companies under the loan agreements (see Bank of Tokyo–Mitsubishi, Ltd., N.Y. Branch v. Kvaerner a.s., 243 A.D.2d 1, 8–10, 671 N.Y.S.2d 905 [1st Dept. 1998] ; Tinicum Fin. Corp. v. Lorch, 226 A.D.2d 214, 640 N.Y.S.2d 756 [1st Dept. 1996] ). Moreover, while defendant's liability under the guaranty may be decided in New York, the companies’ liability under the loan agreements must be decided in Romania and under Romanian law.
Although this action was filed first, chronology is not dispositive, "particularly where both actions are at the earliest stages of litigation" ( San Ysidro Corp. v. Robinow, 1 A.D.3d 185, 186, 768 N.Y.S.2d 191 [1st Dept. 2003] ). "[T]he practice of determining priorities between pending actions on the basis of dates of filing is a general rule, not to be applied in a mechanical way, regardless of other considerations" ( White Light Prods. v. On the Scene Prods., 231 A.D.2d 90, 97, 660 N.Y.S.2d 568 [1st Dept. 1997] ; see also Syncora Guar. Inc. v. J.P. Morgan Sec. LLC, 110 A.D.3d 87, 95, 970 N.Y.S.2d 526 [1st Dept. 2013] ). Here, both actions are in the early stages and were commenced reasonably close in time and the later-filed action is more "comprehensive" and involves more parties (see IRX Therapeutics, Inc. v. Landry, 150 A.D.3d 446, 446–447, 55 N.Y.S.3d 4 [1st Dept. 2017] ; AIG Fin. Prods. Corp. v. Penncara Energy, LLC, 83 A.D.3d 495, 495–496, 922 N.Y.S.2d 288 [1st Dept. 2011] )
Plaintiff's remaining arguments are unavailing.