Opinion
No. 1143.
June 19, 2007.
Order, Supreme Court, New York County (Faviola A. Soto, J.), entered June 9, 2006, which, to the extent appealed from as limited by the brief, granted defendants' motion to the extent of dismissing the eleventh and fourteenth causes of action, unanimously affirmed, without costs.
Gibson, Dunn Crutcher LLP, New York (Randy M. Mastro of counsel), for appellants.
Holland Knight LLP, New York (David D. Howe of counsel), for respondents.
Before: Saxe, J.P., Nardelli, Buckley, Sweeny and Malone, JJ.
The provision in the promissory note calling for payment of $2,000 a day should defendant fail to pay the judgment in a timely fashion is an unenforceable penalty. Should plaintiff be found to be entitled to damages, they would be easily ascertainable, and thus the true purpose of the provision was to "secure performance by threat of a large payment rather than to provide a reasonable assessment of probable damages" ( Quaker Oats Co. v Reilly, 214 AD2d 565, 566; see also Truck Rent-A-Ctr. v Puritan Farms 2nd, 41 NY2d 420, 425 [1977]; Manhattan Syndicate v Ryan, 14 AD2d 323, 327).