Opinion
22011/09.
Decided March 22, 2011.
Arnold Davis, Esq., New York, NY, Plaintiff's Attorney.
Fulbright Jaworski, L.L.P., Neil G. Sparber, Esq., Samantha Beltre, Esq., New York, NY, Defendant's Attorney.
The motion and cross motion were referred to this matrimonial part from Hon. Martin Solomon, J.S.C. upon this Court's decision to consolidate the action herein for purposes of joint trial together with a post judgment action for enforcement of a Post Nuptial Agreement and Judgment of Divorce, which action is already pending before this Court under index No. 833/2001. Upon such transfer, the motion, cross motion and responsive papers were misplaced. As a result, the Court requested that plaintiff and defendant reconstruct the record. As a consequence of the transfer of the action and reconstruction of the record, issuance of a Decision on the motion and cross motion filed under index #22011/09 was delayed to this date.
Contract Action Motion for Summary Judgment
By Notice of Motion dated November 25, 2009, plaintiff, Gail G. Sutton, moves for summary judgment against the defendant for the relief demanded in the complaint, to wit:
On September 6, 1995, plaintiff (Wife) and Joseph A. Sutton (Husband) entered into a Post Nuptial Agreement. Pursuant to Article 5 of the Agreement, Husband agreed to pay maintenance to plaintiff following an "Event of Marital Discord". A Judgment of Divorce was signed by Hon. Mary Ellen Fitzmaurice, J.S.C., on June 25, 2002 under index #833/2001.
Article 5, subdivision 3 of the Post Nuptial Agreement states as follows:
The payments the Husband is required to pay hereunder shall be guaranteed by Alfred J. Sutton, or if Alfred J. Sutton shall be deceased by Morris A. Sutton and Richard A. Sutton, jointly and severally (each of whom is referred to as the "guarantor"). In the event the Husband fails to make any payments when due, the guarantor shall promptly make such payment, but in no event later than 10 days after the sending of written notification by certified mail, return receipt requested, of such nonpayment by the Husband.
(See Plaintiff's Exhibit A, page 9, paragraph 3).
At the bottom of page 20 of the Post Nuptial agreement, Alfred J. Sutton and Morris A. Sutton signed the following statement, "As to those provisions pertaining to Alfred J. Sutton, Morris A. Sutton and Richard A. Sutton, agreed and accepted".
The Post Nuptial Agreement was incorporated in but not merged with the Judgment of Divorce entered on June 28, 2002.
Plaintiff claims that Husband is in default of paying maintenance to plaintiff in the sum of $100,520.00. Plaintiff contends that payment was demanded of Husband by letter dated August 5, 2009, which letter was sent by certified mail, return receipt requested (see plaintiff's Exhibit C). Plaintiff claims she notified defendant of the default and demanded payment by letter dated August 5, 2009 which letter was also sent by certified mail, return receipt requested (see plaintiff's Exhibit D). Plaintiff argues that more than ten (10) days have elapsed since defendant was notified but defendant has failed and refused to pay the maintenance arrears demanded.
For these reasons, plaintiff demands judgment against defendant Alfred J. Sutton in the amount of $100,520,00, with interest thereon from August 15, 2009 together with the costs and disbursements of this action.
Cross Motion
Defendant, Alfred J. Sutton, cross moves for an order:
(1) denying plaintiff's motion for summary judgment; (2) dismissing plaintiff's instant cause of action pursuant to CPLR §§ 3211 (a) (4) and 3211 (c); or, in the alternative, (3) staying plaintiff's instant cause of action pursuant to CPLR § 2201 until a determination of a pending cross motion before this court which seeks, among other things, to consolidate this action with a post-judgment Matrimonial Action bearing index # 833/2001; and (3) granting to defendant such other and further relief as this Court deems just and proper.
Defendant argues that at no time prior to the commencement of the instant action did plaintiff commence any proceedings against his son (Husband) for enforcement of the Post Nuptial Agreement, nor was there any determination made by any court that Husband is in default of the Post Nuptial Agreement, or that any amounts are due and owing to plaintiff for arrears in maintenance. Defendant claims that after the commencement of the instant action, plaintiff moved in the original Matrimonial Action in this court for virtually the same relief sought herein, to hold the Husband in contempt for failure to make the identical maintenance payments sought herein.
Plaintiff's Reply
In plaintiff's reply to defendant's opposition to the motion for summary judgment and in opposition to defendant's cross-motion, counsel argues that the issues in this action are sounded in contract law; the defendant is a guarantor of payment and the contract between the parties is unambiguous in such respect. Counsel states this action was commenced prior to the filing of plaintiff's contempt proceeding against the Husband in the Matrimonial Action and is based upon their Post Nuptial Agreement. Counsel argues that the Husband may claim a set-off of his liability for payment to his ex-wife but the defendant may not escape his contractual liability to the plaintiff.
Matrimonial Action
Motion for Contempt
On October 21, 2009, plaintiff moved for an order: (A) Punishing defendant, Joseph A. Sutton (Husband) as and for a contempt of this Court for allegedly failing and refusing to comply with provisions of the Judgment of Divorce in that the Husband failed to pay maintenance and failed to furnish plaintiff with a policy of life insurance as provided in the parties' Post Nuptial Agreement; (B) Granting plaintiff counsel fees for services rendered to her in this enforcement proceeding; (C) Enjoining and restraining Husband from transferring, hypothecating and/or otherwise disposing of assets and/or property of any nature in which Husband had or currently has an interest; and (D) Granting to plaintiff such other and further relief which to the Court may seem just and proper.
Cross Motion
The Husband filed a cross motion in the Matrimonial Action, dated December 2, 2009, seeking an Order:
(A)Dismissing plaintiff's contempt motion; (B) Alternatively, directing discovery and a hearing in regard to plaintiff's contempt motion pursuant to DRL §§ 245 and 246, Judiciary Law § 756 and CPLR § 3101; (C) Terminating Husband's maintenance obligations under the parties' Judgment of Divorce and Post Nuptial Agreement pursuant to DRL § 248 and directing plaintiff to repay Husband any amounts paid as maintenance after the date of such termination; (D) Alternatively, modifying downward Husband's maintenance obligations under the parties' Judgment of Divorce and Post Nuptial Agreement pursuant to DRL §§ 236 (B) (9) and 246; (E) Directing appropriate discovery and a hearing in regard to Husband's application for termination or, alternatively, downward modification of his maintenance obligations under the Post Nuptial Agreement and Judgment of Divorce, pursuant to DRL §§ 236 (B) (9), 246 and CPLR § 3101; (F) Granting Husband a protective order, pursuant to CPLR §§ 3101 and 3103, directing plaintiff and her counsel not to disclose or utilize for any purposes certain documents and/or communications received from Husband's counsel for the purpose of settlement negotiations; (G) Granting Husband sanctions pursuant to 22 NYCRR § 130, including but not limited to reasonable counsel fees, based upon that portion of plaintiff's motion seeking proof of required life insurance on Husband's life, which application is frivolous; (H) Granting Husband consolidation of the Matrimonial Action with the related Contract action, pursuant to CPR § 602(a) upon the grounds that they involve common questions of law and fact; and (I) Such other and further relief as this Court deems just and proper.
April 7, 2010 Decision
Pursuant to plaintiff's motion dated October 22, 2009 and Husband's cross motion in the Matrimonial Action dated December 8, 2009, the Contract Action and the Matrimonial Action were consolidated for purposes of trial. This Court found as follows: (A) Plaintiff's motion for contempt, counsel fees and a preliminary injunction was denied; (B) Those portions of defendant's cross motion seeking termination of Husband's maintenance obligations, or for a hearing concerning same, and issuance of a protective order were denied.
That portion of Husband's motion seeking downward modification was granted to the extent that a hearing shall be conducted to hear the following issues: (1) Whether Husband is entitled to a downward modification of his maintenance obligations under the Post Nuptial agreement and judgment of divorce on the ground of extreme financial hardship; and (2) The amount of maintenance arrears which are owed to plaintiff as of the date of such hearing; (3) That portion of Husband's cross motion seeking consolidation of the Matrimonial Action with the within action was granted only to the extent that said cases are joined for the purpose of trial; and (4) Each shall retain its own index number, separate RJI's, require the filing of separate notes of issue, and require the filing of separate judgments.
Discussion
As a preliminary matter, defendant is incorrect that at no time prior to the commencement of the instant action did plaintiff commence any proceedings against defendant's son (Husband) for enforcement of the Post Nuptial Agreement. A motion was made to have this Matrimonial Court hold Husband in contempt for failing to pay maintenance in accordance with the parties' Agreement approximately one month before the motion was made seeking payment from the guarantor.
The contract of guaranty shall be construed strictissimi juris ( 100 Parkway Road v. Johns-Manville, Inc., 258 AD 736) and is subject to the same rules of interpretation as other contracts, and especially to that fundamental rule requiring them to be enforced according to the meaning and intent, and in the manner designed by the parties at the time of their execution ( People v. Lee, 104 NY 441).
Here, the clear language of the guarantee in the Post Nuptial Agreement (Article 5, paragraph 3) demonstrates that it is a guarantee of payment and not of collection. "Whether a surety is a guarantor of payment or a guarantor of collection depends upon the intention of the parties as expressed in the contract. If he binds himself to pay immediately upon default of the debtor, he becomes a guarantor of payment; if he binds himself to pay only after all attempts to obtain payment from the debtor have failed, he becomes a guarantor of collection." ( Federal Deposit Ins. Corp. v. Schwartz, 78 AD2d 867). The defendant-guarantor is bound by the precise terms of his contract (see e.g., Hamilton Trust Co. v. Shevlin, 156 AD 307).
It is well settled that summary judgment is a drastic remedy and cannot be granted if any issue warranting a trial exists. The 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 eliminate any material issues of fact from the case (see, Zuckerman v. City of New York, 49 NY2d 557, 562; Sillman v. Twentieth Century-Fox Film Corp., 3 NY2d 395, 404). Failure to make such showing requires denial of the motion regardless of the sufficiency of the opposing papers ( Winegrad v. New York Univ. Med. Ctr., 64 NY2d 851; Matter of Redemption Church of Christ v. Williams, 84 AD2d 648, 649; Greenberg v. Manlon Realty, 43 AD2d 968, 969). The evidence presented must be viewed in the light most favorable to the party opposing the motion for summary judgment ( Negri v. Stop Shop, 65 NY2d 625; Gray v. New York City Transit Authority, 12 AD3d 638; Louniakow v. M.R.O.D. Realty Corp, 282 AD2d 657).
Plaintiff has presented detailed documentary support for her motion, while defendant failed to advance facts rebutting plaintiff's proof or to raise triable issues of fact (see Federal Deposit Ins. Corp. v. Schwartz, 55 NY2d 702). Neither Husband nor defendant submitted any proof such as cancelled checks or receipts to demonstrate that the maintenance payments due under the Post Nuptial Agreement were paid.
Viewing the evidence in the light most favorable to defendant, the Court finds that plaintiff is entitled to summary judgment to the extent that a hearing shall be conducted to determine the amount of maintenance due and owing by Husband to plaintiff and consequently, the amount due by the guarantor to plaintiff in the event Husband remains in breach of his maintenance obligations.
In accordance with the precise terms contained in the Post Nuptial Agreement, there is no question that the guarantor became liable to plaintiff for maintenance arrears once Husband failed to pay and demand for payment was made in accordance with the terms of the Agreement. Furthermore, defendant does not refute plaintiff's allegation that the maintenance payments were not made. Rather, he argues that Husband's defenses to the motion in the Matrimonial Action require that the motion for summary judgment be denied. Since the defenses available to the Husband in the enforcement (Matrimonial) action are not available to the guarantor in this contract action, defendant's argument does not rebut plaintiff's prima facie case.
Conclusion
For the reasons stated herein, upon a thorough review of all of the papers submitted on the motion and cross motion and in opposition thereto and after oral argument, plaintiff's motion seeking summary judgment is granted to the extent that a hearing shall be conducted to determine the amount of maintenance arrears due by Husband to plaintiff and consequently, the amount due by the guarantor to plaintiff. In no event, shall plaintiff have a double recovery. Any issue not specifically addressed herein is deemed denied.
The parties shall appear in Part 5T on May 23, 2011 at 2:30 p.m. for a status conference.
The foregoing constitutes the decision and order of the court.