PRELIMINARY STATEMENT

Robert G. Lucas as agent for Lucas Investors Group, hereinafter "plaintiff", seeks summary judgment against Jacob Mathew, Thomas Kurian and Thomas Mathal, hereinafter "defendants", alleging that they have defaulted upon a mortgage bond dated March 6, 2008 ^[FN1], in the amount of $1,100,000.00. The mortgage bond was to be repaid at an interest rate of sixteen (16%) percent per annum in monthly installments of $14,666.67 commencing on the 1st day of May, 2008, and monthly thereafter, until the 1st day of September, 2009, when the entire unpaid balance together with accrued interest became due and payable.

Defendants contend that summary judgment would be inappropriate in the instant action because there are issues of material fact such as notice, and whether the defendants had actually defaulted on the loan.

On September 1, 2008, defendants made a payment of $50,000.00 to plaintiffs. Plaintiff allegedly applied the $50,000.00 to the principal balance of the loan, thus reducing defendants monthly interest payments from $14,666.67 to an even $14,000.00. Plaintiff asserts that the defendants made numerous monthly payments thereafter of $14,000.00 until the October 2009 payment became due on November 1, 2009 when all payments ceased. Plaintiff further contends that during the months of November and December, many attempts were made to contact the defendants regarding the overdue payments but these attempts allegedly went unanswered.

Plaintiff commenced this action for repayment.

Defendants allege that they received a fax in early December 2009 from the plaintiff advising that they owed the prior two months payments and that they must either remit payment including the late fees immediately or provide the plaintiffs with "some reasonable explanation by December 16, 2009" otherwise plaintiff would commence a lawsuit.^[FN4] The notice given by plaintiff of the overdue payments was submitted to the defendants via fax. They contend that paragraph 8 of the mortgage calls for notice or demand in writing via personal service or via mail, and proper notice was not given. Additionally, defendants argue that the reason why they were unable to make the necessary payments was because the commercial premise, for which the loan had been given, had become vacant. Further, defendants contend that this information was communicated to the plaintiff.

In addition, defendants argue that the $50,000.00 paid toward the loan, more than a year before, was believed to have the effect of a "cushion of a few months whereby said amount could be applied toward the payments that were unable to be made".^[FN5] For this reason, defendants argue that there is an issue of fact as to whether a portion of the $50,000.00 should have been applied to the November 2009 bill.

When presented with a motion for summary judgment, the function of a court is "not to determine credibility or to engage in issue determination, but rather to determine the existence or non-existence of material issues of fact." (Quinn v. Krumland, 179 AD2d 448, 449 — 450 [1st Dept. 1992]); See also, ( S.J. Capelin Associates, Inc. v. Globe Mfg. Corp. 34 NY2d 338, 343, [1974]).

To grant summary judgment, it must clearly appear that no material and triable issue of fact is presented. (Stillman v. Twentieth Century-Fox Corp., 3 NY2d 395, 404 [1957]). It is a drastic remedy, the procedural equivalent of a trial, and will not be granted if there is any doubt as to the existence of a triable issue. (Moskowitz v. Garlock, 23 AD2d 94 [3d Dept. 1965]); [*3](Crowley's Milk Co. v. Klein, 24 AD2d 920 [3d Dept. 1965]).

The evidence will be considered in a light most favorable to the opposing party. (Weill v. Garfield, 21 AD2d 156 [3d Dept. 1964]). The proof submitted in opposition will be accepted as true and all reasonable inferences drawn in favor of the opposing party. (Tortorello v. Carlin, 260 AD2d 201, 206 [1st Dept. 2003]). The opposing party is obligated to come forward and bare his proof, by affidavit of an individual with personal knowledge, or with an attorney's affirmation to which appended material in admissible form, and the failure to do so may lead the Court to believe that there is no triable issue of fact. (Zuckerman v. City of New York, 49 NY2d 557, 562 [1980]).

Under CPLR 3213, a party may bring an action to recover monies owed on a promissory note, by serving with the summonsa notice of motion for summary judgment in lieu of a complaint. (CPLR 3213). "A document comes within CPLR 3213 if a prima facie case would be made out by the instrument and a failure to make the payments called for by its terms'. " (Interman Indus. Prods. v. R.S.M. Electron Power, 37 NY2d 151, 155 [1975]). Once the moving party has made a prima facie showing of entitlement to summary judgment the "burden shifts to the defendant to establish by admissible evidence the existence of a triable issue of fact with respect to a bona fide defense." (Quest Commercial, LLC v. Rovner, 35 AD3d 576 [2d Dept 2006]).

Here, plaintiff made a prima facie showing by producing a copy of the promissory note and mortgage instruments together with the individual defendants' signed guarantees of said promissory note. In addition, plaintiff claims that the defendants account has been in default since November 2009. Defendants admit that they have not made any payments from November 2009 forward on the note. Thus, because plaintiff has made a prima facie showing, defendants only opportunity to defeat a summary judgment ruling is to establish, as stated above, by admissible evidence the existence of a triable issue of fact.

In the instant action, defendants first argue that the notice of non-payment issued by the plaintiff was not proper because paragraph 8 of the mortgage states "That notice and demand or request may be in writing and may be served in person or by mail." ^[FN6] It is the defendants contention that there is an issue as to whether facsimile may be interpreted to be mail. However, the plaintiff points out in its reply affidavit that paragraph 8 of the mortgage does not refer to non-payments of the mortgage. Rather, paragraph 8 continues from paragraph 7 which states:

"that the mortgagor (Jaytom Realty LLC) within five days upon request in person or within ten days upon request by mail will furnish a written statement duly acknowledged of the amount due on this mortgage and whether any offsets or defenses exist against the mortgage debt."^[FN7]

Therefore, defendants argument that notice be given via mail or in person is not supported by this provision of the mortgage. Additionally, it is the opinion of the court that even if paragraph 8 had been related to non-payments, it would still not be an obligation of the plaintiff to provide such [*4]notice because the provision unambiguously uses the word may. Thus, the plaintiff would not be obligated to issue such notice but could at its own discretion.

It is further rebutted by the plaintiff that notice of default was required. Plaintiff contends that the guarantee signed by each defendant waives any requirement of notice of default.^[FN8] After a careful reading of the language of both the mortgage and the guarantee, the court finds that there was no requirement of notice, and, if any were implied, it was waived by the defendants in signing the guarantee.

Defendants allege that there is a triable issue of fact because they believed that the September 2008 payment of $50,000.00 would be applied to the overdue payments in November and December 2009. This argument is simply without merit. Plaintiffs state that the payment went toward reduction in principal, and a corresponding reduction in monthly payments to $14,000, of which defendants were well aware, and which they made for a number of months, starting in September 2008. Defendants' $50,000 payment produced a reduction in principal and in monthly payments. It did not constitute a cushion against future defaults.

The motion for summary judgment is granted. Submit Judgment.

This constitutes the Decision and Order of the Court.

Dated:June 24, 2010

J.S.C.