Upon the foregoing papers it is ordered that this motion by the plaintiff for summary judgment is granted to the extent that judgment shall be entered for the plaintiff on the issue of the defendants' liability for debts to the plaintiff stemming from the contract between the parties dated April 15, 2004, as amended June 10, 2004, and the case shall proceed to trial on the issue of damages.

This action arises out of an April 15, 2004 Agreement pursuant to which plaintiff Interface Financial Group, LLC (Interface) agreed to purchase accounts receivable from defendant New York Recycling, Inc. (NYR). Interface sues for $86,544.42, which includes interest and fees through October 30, 2006. It also seeks attorneys' fees and costs. The principal issue before the Court is a personal guaranty of NYR's debts under the agreement undisputedly executed on April 15, 2004 by defendant Joseph A. Aragona, the president of defendant NYR.

The document is entitled "Personal Guaranty and Subordination." Insofar as is relevant to the foregoing issue, the Definitions section refers to "you" as "each person" signing the document as guarantor, and "Seller" as the "person or entity" selling accounts receivable, specifically, New York Recycling, Inc. Under the "Guaranty" section the document recites that "You are signing this Guaranty in order to give us assurance that Seller will fully and promptly perform all the Terms and Conditions and will pay us when due any money Seller now or hereafter owes us." The "Guaranty" section also provides that "This Guaranty will continue in effect even if: (1) a different person is carrying on the Seller's business at a later time, (2) Seller changes its business name, (3) Seller adds, removes or changes directors, officers, members, partners or agents and (4) your relationship to Seller changes." Finally, under the section entitled, "Waiver of Notice and of Proceedings Against Seller" the guaranty provides that "We may enforce this Guaranty without first having to take any other steps to require Seller or any other person or entity to cure the default..." [*2]

The Guaranty also recites that it shall be governed by the laws of the State of New Jersey.

However and this is Aragona's central defense the document concludes with a divided page for signatures, and on the left-hand side, above his signature, appear the typed words "New York Recycling, Inc," and below his signature appear the hand-printed words, "Joseph A. Aragona, Pres."

In addition to the foregoing, the Court notes certain terms of the underlying agreement with NYR, which is entitled "Terms and Conditions for Purchasing Accounts Receivable." Initialed on each page and signed by Aragona in the same manner as is indicated above, it recites under the section entitled "Other Documentation" that NYR will deliver to the plaintiff credit check and bank authorizations regarding NYR's credit history, "and, where applicable, the credit history of officers, directors, partners and other principals." Such an authorization was provided by Joseph Aragona, entitling the plaintiff to obtain credit history on both his business and personal accounts. The section also required delivery of the Personal Guaranty and Subordination form described above (identified by a form number matching that of the aforestated document), so that "you will personally guarantee the obligations undertaken to us by the Seller."

The Agreement was amended on June 10, 2004 by an Addendum which allowed for the advance of funds by plaintiff, on behalf of defendant NYR and for its benefit, to Platinum Payroll Services of Northeast Corp. (Platinum), which provided payroll processing and other administrative services to defendant NYR. According to the complaint, the advances made by plaintiff Interface to Platinum were to cover the cost of payroll and payroll related expenses necessary for defendant NYR to generate the receivables being purchased by plaintiff. Under the Addendum, all payments made by Interface to Platinum on behalf of NYR were, in essence, payments by Interface to NYR.[*3] It is not disputed that between April and November of 2004 Interface and NYR completed six transactions under which Interface paid for over $300,000 of accounts receivable from NYR, and Interface later received payment of the receivables.

However, it also is not disputed that Interface wired $39,929.51 to Platinum on NYR's behalf as advances on sums owed to NYR by a third party on a construction job being performed by NYR, and that NYR defaulted on its obligations to pay plaintiff under the Agreement and Addendum for these advances. That default is the issue in this case, including, and most importantly, the individual liability of Aragona for those payments under the guaranty dated April 15, 2004.

As noted, defendant Aragona avers that the signature page of the guaranty itself, whereon he signed his name beneath the typewritten legend "New York Recycling, Inc." and above the words "By: Joseph A. Aragona, Pres.," evidences the fact that, having signed the guaranty in a representative and not personal capacity he cannot be held personally liable for the corporate defendant's indebtedness. Moreover, he denies ever having orally acknowledged such personal responsibility to certain non parties, as alleged by the plaintiff. However, he does not deny that he separately signed the documents noted above.

Initially, the Court finds that this matter must be decided under the substantive law of the State of New Jersey, as expressly contemplated by the parties in their April 14, 2004 agreement. Absent some showing that the chosen law violates some fundamental precept found in New York law - not at[*4] all the case here, as indicated below - the courts of this State will enforce a choice-of-law provision in a contract. Wellsbach Elec. Corp. v MasTec N. Am., Inc., 7 NY3d 624, 629 (2006); Matter of Smith Barney, Harris Upham & Co. v Luckie, 85 NY2d 193 (1995); Boss v American Express Fin. Advisors, Inc., 15 AD3d 306 (1st Dept. 2005), affd. 6 NY3d 242 (2006); see also Feldman v CSX Trans., Inc., 31 AD3d 698, 706 (2d Dept. 2006).

However, it is also true that " matters of procedure are governed by the law of the forum.' " See Tanges v Heidelberg N. Am., 93 NY2d 48, 53 (1999), quoting Martin v Dierck Equip. Co., 43 NY2d 583, 588 (1978); Education Resources Inst., Inc. v Piazza, 17 AD3d 513 (2d Dept. 2005), which would include the burdens and showings required on a motion made under Article 32 of the CPLR. See Ground To Air Catering v Dobbs Intl. Servs., 285 AD2d 931 (3d Dept. 2001).As the parties have chosen to litigate in New York (waiving the separate contractual provisions in both the Interface-NYR contract and the personal guaranty fixing Union County, New Jersey, as the venue for any action related to the parties' agreement), the summary judgment standards to be applied are those of New York.

In this particular case, however, New York law will have an impact on substance as well as on procedure. The reason is that there appears to be no dispositive New Jersey law on the key question presented here. As described above, that question is whether an individual who executes a guaranty of a corporation's performance can be held liable when the capacity in which he signs is not clearly individual, as opposed to representative. Indeed, one of the cases of the Appellate Division of New Jersey's Superior Court, cited by the defendants in support of their position on the guaranty, noted the absence of authority in New Jersey on the issue and referred to New York law as[*5] the basis of its ruling. Home Buyers Warranty v Roblyn Dev. Corp., 2006 WL 2190742 (N.J. Super. A.D. 2006 [n.o.r.]). Accordingly, the Court finds that there is no conflict between the substantive law of New Jersey and the law of New York regarding the issue. Moreover, given this recent decision of the New Jersey Appellate Division to follow, or at least be guided by, the law of New York, the Court will look to the law of this State as indicative of what would be applied in New Jersey regarding the specific facts of this case.

As a general proposition, an officer is not liable for the contractual obligations of a corporation. Rather, under either New York or New Jersey law liability will be imposed on a corporate officer only when the officer purposefully agrees to accept personal responsibility for the corporation's contractual performance. See, PNC Capital Recovery v Mechanical Parking Systems, Inc., 283 AD2d 268 (1st Dept. 2001); Center 48 Ltd. Partnership v May Dept. Stores Co., 810 A2d 610, 619 (N.J. Super. A.D. 2002) ["[g]uarantee agreements should be strictly construed and their language interpreted most strongly against the party at whose insistence such language was included."]. And in Home Buyers Warranty v Roblyn Development Corp., supra, the New Jersey Appellate Division court quoted the New York Court of Appeals Salzman Sign Co. v Beck, 10 NY2d 63, 67 (1961) for the proposition that liability will be imposed upon a corporate officer only when there is clear and explicit evidence of his intention to substitute or superadd his personal liability for, or to, that of the corporation.

However, that clear and explicit evidence exists here. Given the record before it, the Court must find that Aragona had agreed to personally guaranty performance of NYR's obligations under the contract. As noted in the sections of the agreement quoted above, the document whose[*6] effectiveness he now disputes is entitled "Personal Guaranty and Subordination Agreement" (emphasis supplied). It clearly separates the seller of the accounts receivable from the guarantor, by 1) describing the seller as either an entity or a person (expressly NYR), but the guarantor as a person, 2) obligating the guarantor irrespective of later changes to the guarantor's relationship to the seller, or changes in the ownership or control of the seller itself, and 3) granting the buyer/plaintiff the right to enforce its rights against the guarantor without having to proceed against the seller. In addition, the agreement with NYR called on it to provide such a personal guaranty, and the means to inquire as to the creditworthiness of the guarantor. Aragona provided the written authorizations to allow that inquiry.

Given these terms and documents, the explanation of the plaintiff's president, Charles Lightner, that he made a clerical error in the preparation of the guaranty is a satisfactory explanation for why the corporation was added above the signature line for Aragona. To find that this line of type, and/or the fact that Aragona added his title with NYR to his hand-printed name, creates a question as to the parties' intentions at the time would require the Court to ignore the perfectly clear language of the documents described above, and that Aragona followed the modern commercial practice of signing the corporation's contract with the plaintiff and again as a guarantor. Home Buyers Warranty v Roblyn Development Corp., supra, citing and quoting Salzman Sign Co. v Beck, supra.

"Further, an interpretation that [the individual] signed the Guaranty solely in his capacity as president of the corporation would compel the illogical conclusion that the purpose of the Guaranty was to provide that in case of [the corporation]'s default, the company would guaranty its own indebtedness, rendering the entire Guaranty meaningless." PNC Capital Recovery v Mechanical Parking Systems, Inc., supra, at 270-271. As noted[*7] by the PNC court, such a finding would be contrary to well-established law that " (i)n construing a contract, one of a court's goals is to avoid an interpretation that would leave contractual clauses meaningless.' " Id., at 271, quoting Two Guys from Harrison-N.Y. v S.F.R. Realty Assocs., 63 NY2d 396, 403 [1984]; see also Chemical Bank v Masters, 176 AD2d 591 (1st Dept. 1991) [addition of word "Pres" after signature merely descriptive, does not affect liability under personal guaranty]. The foregoing is consistent with New Jersey law, in which courts evaluating contracts are to be guided by the principle that a contract must be construed as a whole, and accorded a rational meaning in keeping with its express general purpose. See, Wheatley v Sook Suh, 525 A2d 340 (N.J. Super. A.D. 1987). In addition, a contract is to be read in light of commercial reality, and in accord with the reasonable expectations of persons in the business community involved in the transactions of the type involved. See, Mt. Holly State Bank v Mt. Holly Washington Hotel, Inc., 532 A.2d 1125 (N.J. Super. Ct. A.D. 1987).

In view of the foregoing, the Court finds that the plaintiff has made out a prima facie case of entitlement to judgment as a matter of law on the issue of Joseph A. Aragona's liability on the personal guaranty, shifting the burden to the defendants to come forward with issues of fact meriting a trial on that issue. CPLR 3212 (b); see GTF Marketing, Inc. v. Colonial Aluminum Sales, Inc., 66 NY2d 965 (1985); Zuckerman v. City of New York, 49 NY2d 557 (1980).

In evaluating the opposing proof, the Court must draw all reasonable inferences in favor of the nonmoving party. Nicklas v Tedlen Realty Corp., 305 AD2d 385 (2d Dept. 2003); Rizzo v. Lincoln Diner Corp., 215 AD2d 546 (2d Dept. 1995). Its role in deciding a motion for summary[*8] judgment is not to resolve issues of fact or to determine matters of credibility, but simply to determine whether such issues of fact requiring a trial exist. Dyckman v. Barrett, 187 AD2d 553 (2d Dept. 1992); Barr v County of Albany, 50 NY2d 247, 254 (1980); James v. Albank, 307 AD2d 1024 (2d Dept. 2003); Heller v. Hicks Nurseries, Inc., 198 AD2d 330 (2d Dept. 1993). The Court need not, however, ignore the fact that an allegation is patently false or that an issue sought to be raised is merely feigned. See, Village Bank v Wild Oaks Holding, Inc., 196 AD2d 812 (2d Dept. 1993).

In the instant case the Court need not evaluate credibility but only the documents. Therefore, while noting Aragona's attack on Lightner's explanation regarding the presence of the corporate name on the guaranty as incredible, the Court finds that he fails to present any evidence or explanation for these documents and the contractual language they contain that might create an issue of fact as to their clear meaning. Accordingly, the Court concludes that he has failed to rebut the plaintiff's prima facie showing of his liability under the personal guaranty.

With respect to the debt, and as noted above, the amount of the payment constituting the underlying amount owed is not disputed, as opposed to any credits against that sum, which is disputed. The Court finds no merit to Aragona's contention that because NYR did not provide an executed Offer to Sell and Notification of Sale before the advances to Platinum were made, it is not entitled to recover. The transaction occurred, and no objection was made by any party thereto, clearly indicating a waiver by both parties in this instance. Moreover, the contract between Interface and NYR provides at section 11 that a waiver by Interface of any provision shall not constitute a waiver of any other provision.

The Court does find, however, that issues of fact remain regarding the calculation of the final amount owed, including a $5,000 claimed credit and attorney's fees, as called for in section V of the personal guaranty. Accordingly, the matter shall proceed to trial on the issue of damages only.

This shall constitute the Decision and Order of this Court.[*9]

E N T E R

DATED: January 23, 2007

_____________________________

HON. DANIEL PALMIERI

Acting Supreme Court Justice