Recitation in accordance with CPLR 2219 (a) of the papers considered on the notice of motion filed on February 27, 2024, under motion sequence number one, by Shari Schieber, as the executrix of the estate of David Wishnick (hereinafter the plaintiff), for an order: (1) pursuant to CPLR 3212, directing the entry of summary judgment in favor of plaintiff and against Patrick Brown (hereinafter the defendant), on the first cause of action and the immediate entry of a money judgment against him in the principal amount of forty three thousand ($43,000.00), together with appropriate interest from October 1, 2018, (2) granting summary judgment in favor of the plaintiff as against the defendant on the second cause of action as to liability, (3) severing that cause of action for a hearing to compute the amount of attorneys' fees due and owing to Plaintiff, (4) dismissing defendant's affirmative defenses and counterclaim, (5) awarding the plaintiff such other and further relief as this Court deems just and proper under the circumstances, including, but not limited to, reasonable attorneys' fees and the costs and disbursements of this action. The motion is opposed.

Exhibits A-B

Exhibits A-B

Recitation in accordance with CPLR 2219 (a) of the papers considered on the cross-motion filed on August 12, 2024, under motion sequence number two, by the defendant Patrick Brown for an order pursuant to CPLR 3212, granting summary judgment in favor of the defendant on the issue of liability and dismissing the instant action. The motion is opposed.

Exhibit A

On October 9, 2023, the plaintiff commenced the instant action for breach of contract by filing a summons and complaint with the Kings County Clerk's office (KCCO). On December 19, 2023, the defendant interposed and filed an answer containing twenty-two denominated affirmative defenses and one counterclaim with the KCCO. On July 15, 2024, the plaintiff filed a reply to the defendant's counterclaim.^[FN1]

The complaint alleges the following salient facts, among others. On August 14, 2017, the defendant executed and delivered to David Wishnick (hereinafter Wishnick or the lender), a note (hereinafter the note) in the amount of $49,025.00, together with interest at the rate of twelve percent (12%) per annum. Annexed as exhibit A to the complaint was copy of the note. Defendant bound himself and promised to pay the lender weekly payments of principal and interest per month and upon the maturity date of July 30, 2019 (hereinafter the maturity date), the principal sum of the note. The note further provided that if the defendant failed to pay the amounts due and payable, the lender, at its option, could declare the entire indebtedness to be due and payable in full.

The note further required defendant to pay to the lender, upon default, all costs and expenses, including attorneys' fees and actual disbursements incurred by the lender in enforcing the note occasioned by any default. The defendant had defaulted by failing to make certain payments due and owing and has failed to pay the outstanding principal due upon maturity date. The sum of $43,000.00 is due and owing under the note and remains unpaid. Lender is also entitled to the costs of collection, including reasonable attorneys' fees.

It is well established that summary judgment may be granted only when no triable issue of fact exists (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). The burden is upon the moving party to make a prima facie showing that he or she is entitled to summary judgment as a matter of law by presenting evidence in admissible form demonstrating "the absence of any material issues of fact" (Alvarez, 68 NY2d at 324; Giuffrida v Citibank Corp., 100 NY2d 72, 81 [2003]).

A failure to make that showing requires the denial of the summary judgment motion, regardless of the adequacy of the opposing papers (Ayotte v Gervasio, 81 NY2d 1062, 1063 [1993]). If a prima facie showing has been made, the burden shifts to the opposing party to produce evidentiary proof sufficient to establish the existence of material issues of fact (Alvarez, 68 NY2d at 324). "Pursuant to CPLR 3212 (b) a court will grant a motion for summary judgment upon a determination that the movant's papers justify holding, as a matter of law, 'that there is no defense to the cause of action or that the cause of action or defense has no merit.' Further, all the evidence must be viewed in the light most favorable to the opponent of the motion" (People v Grasso, 50 AD3d 535, 544 [1st Dept 2008], citing Marine Midland Bank v Dino & Artie's Automatic Transmission Co., 168 AD2d 610, 610 [2d Dept 1990]).

The plaintiff seeks, among other things, an order pursuant to CPLR 3212, granting summary judgment in plaintiff's favor on the first cause of action in the principal amount of $43,000, with interest. Plaintiff also seeks an order granting summary judgment on the second cause of action for attorney's fees and severing that cause of action for a hearing to compute those fees. Plaintiff also seeks an order dismissing the defendant's affirmative defenses and counterclaim.

"[A] cause of action for breach of contract requires that [the] plaintiff show the existence of a contract, the performance of its obligations under the contract, the failure of the defendant to perform its obligations and damages resulting from [the] defendant's breach" (Daire v Sterling Ins. Co., 204 AD3d 1189, 1190 [3d Dept. 2022], quoting GRJH, Inc. v 3680 Props., Inc., 179 AD3d 1177, 1178 [3d Dept 2020]; Carroll v Rondout Yacht Basin, Inc., 215 AD3d 1190, 1191 [3d Dept. 2023]). "A plaintiff meets its prima facie burden of proof on a motion for summary judgment regarding a breach of contract action based upon a loan in default by proffering evidence of the obligation and the defendant's default" (Velocity Investments, LLC v Lymon, 218 AD3d 1091, 1091 [3d Dept 2023], citing Community Bank, N.A. v Sharkey, 182 AD3d 681, 682 [3d Dept 2020]).

While the complaint alleges facts explaining the amount allegedly owed by the defendant, it is unverified and cannot be used as an affidavit pursuant to CPRL 105 (u) (see CPLR 105 [u]). Therefore, plaintiff's proof of the defendant's alleged debt must come from other admissible evidence.

Here, the only sworn testimony submitted in support of the motion was the affidavit of Ryan Manigo (hereinafter Manigo). Manigo averred that he was the office manager for Wishnick and is the current office manager for the plaintiff, Shari Schieber, as the executrix of estate of David Wishnick. He averred that as office manager, he has personal knowledge of Wishnick's and plaintiff's procedures for creating and maintaining business records, including [*3]those records related to the note at issue. He also averred that he possesses those business records, reviewed them, and as such, has personal knowledge of the facts that they revealed. He authenticated the note, and a business ledger annexed as exhibit A and B to his affidavit.

Manigo further averred that on August 14, 2017, Wishnick made a personal loan to the defendant in the amount of $49,025.00 and the that the loan was memorialized in the annexed promissory note. He contended that by the terms of the note, the defendant had bound himself and promised to pay the lender principal and interest and, upon the date of maturity, a balloon payment representing the principal sum of the note. Manigo averred that the ledger reflected arrears and payments made by the defendant.

The annexed ledger, however, is not self-explanatory and Manigo did not explain how to read it. He also did not explain what facts he gleaned from the ledger. In sum, he provided no details explaining how he arrived at the amount that the defendant allegedly owed.

Accordingly, the plaintiff does not establish entitlement to summary judgment in its favor on its claim against the defendant for breach of contract for failure to pay on a promissory note. Consequently, the branch of the motion seeking costs and attorney's fees based on the breach must also be denied. The denial is without regard to the sufficiency of the defendant's papers in opposition (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]).

"CPLR 3211 (b) provides that '[a] party may move for judgment dismissing one or more defenses, on the ground that a defense is not stated or has no merit.' When moving to dismiss, the plaintiff bears the burden of demonstrating that the affirmative defenses 'are without merit as a matter of law because they either do not apply under [the] factual circumstances of the case or fail to state a defense'" (Shah v Mitra, 171 AD3d 971, 974 [2d Dept 2019], quoting Bank of Am., N.A. v. 414 Midland Ave. Assoc., LLC, 78 AD3d 746, 748 [2d Dept 2010]). "On a motion pursuant to CPLR 3211 (b), the court should apply the same standard it applies to a motion to dismiss pursuant to CPLR 3211 (a) (7), and the factual assertions of the defense will be accepted as true" (Shah, 171 AD3d at 974, quoting Wells Fargo Bank, N.A. v Rios, 160 AD3d 912, 913 [2d Dept 2018]). "Moreover, if there is any doubt as to the availability of a defense, it should not be dismissed" (Lewis v US Bank N.A., 186 AD3d 694, 697 [2d Dept 2020]).

The plaintiff submitted a memorandum of law in which the plaintiff made the following observations and contentions. The defendant asserts twenty-two denominated affirmative defenses. Each one consists of a single sentence, none of which alleged any fact in support. The plaintiff contends that because all the asserted affirmative defenses lack factual support they must be rejected on that basis.

"[W]here affirmative defenses 'merely plead conclusions of law without any supporting facts,' the affirmative defenses should be dismissed pursuant to CPLR 3211 (b)" (Bank of Am., N.A. v 414 Midland Ave. Assoc., LLC, 78 AD3d 746, 750 [2d Dept 2010], quoting Fireman's Fund Ins. Co. v Farrell, 57 AD3d 721, 723 [2d Dept 2008]).

The defendant did not address the branch of the plaintiff's motion seeking to strike the defendant's affirmative defenses. Therefore, except for the first affirmative defense, this branch of the plaintiff's motion is granted.

The first affirmative defense is that the complaint fails to state a cause of action. The motion to strike this affirmative defense must be denied. "[N]o motion by the plaintiff lies under [*4]CPLR 3211 (b) to strike the defense of failure to state a cause of action, as this amounts to an endeavor by the plaintiff to test the sufficiency of his or her own claim" (Ochoa v Townsend, 209 AD3d 867 [2d Dept 2022], quoting Butler v Catinella, 58 AD3d 145, 150 [2d Dept 2008]).

Defendant's counterclaim seeks attorneys' fees. "Under the American rule, 'attorney's fees are incidents of litigation, and a prevailing party may not collect them from the loser unless an award is authorized by agreement between the parties, statute or court rule' (Sage Sys., Inc. v Liss, 39 NY3d 27, 30-31 [2022], quoting Hooper Assoc. b AGS Computers, 74 NY2d 487, 491 [1989]; Baker v Health Mgmt. Sys., Inc., 98 NY2d 80, 88 [2002], quoting Hooper Assoc. v AGS Computers, 74 NY2d 487, 491 [1989]). Here, the defendant did not plead any allegations of fact alleging either a statute, court rule, or agreement which would support a claim for attorney's fees.

Although the note does contain language permitting the plaintiff to collect its attorney's fees, there is no reciprocal contractual agreement between the parties entitling the defendant to attorney's fees. Accordingly, the plaintiff has made a prima facie showing of entitlement to dismissal of the defendant's counterclaim for attorneys' fees. In opposition the defendant did not raise a triable issue of fact. Therefore, the counterclaim is dismissed.

The defendant's motion for summary judgment seeks denial of the plaintiff's motion for summary judgment and dismissal of the plaintiff's complaint. The branch of the defendant's motion seeking dismissal of the plaintiff's complaint alleged three points of law. The first point of law was that the action may not be maintained because the plaintiff failed to prove that Wishnick was a lawful private lender. The second was that CPLR 4519 prevents the statements by the plaintiff and Manigo. The third was that the loan is usurious.

The defendant's contention that the action may not be maintained because the lender was not a lawful private lender has no merit. The law that the defendant cited in support of this contention is not applicable to the instant action.

CPLR 4519 provides in pertinent part as follows:

Upon the trial of an action or the hearing upon the merits of a special proceeding, a party or a person interested in the event, or a person from, through or under whom such a party or interested person derives his interest or title by assignment or otherwise, shall not be examined as a witness in his own behalf or interest, or in behalf of the party succeeding to his title or interest against the executor, administrator or survivor of a deceased person or the committee of a person with a mental illness, or a person deriving his title or interest from, through or under a deceased person or person with a mental illness, by assignment or otherwise, concerning a personal transaction or communication between the witness and the deceased person or person with a mental illness, except where the executor, administrator, survivor, committee or person so deriving title or interest is examined in his own behalf, or the testimony of the person with a mental illness or deceased person is given in evidence, concerning the same transaction or communication.

"CPLR 4519, known colloquially as the 'Dead Man's Statute,' provides that a person interested in the event shall not be examined as a witness in his own behalf against the executor, administrator, or survivor of the decedent concerning a personal transaction or communication with the decedent." (Matter of Petretti, 83 Misc 3d 1215[A], 2024 Slip Op 50716[U] [Sup Ct, Queens County 2024]).

The affidavit of Manigo pertains to the contents of business records that he kept as the prior office manager of Wishnick and as the current office manager for the plaintiff. His affidavit is not offered on his own behalf against Wishnick or against the plaintiff. Therefore, contrary to the defendant's contention, the affidavit of Manigo is not barred under CPLR 4519.

The defendant alleges that the loan evidenced by the note is usurious. General Obligations Law § 5-501 (2) provides that "[n]o person or corporation shall, directly or indirectly, charge, take or receive any money, goods or things in action as interest on the loan or forbearance of any money, goods or things in action at a rate exceeding [the maximum permissible interest rate]" (General Obligations Law § 5-501 [2]). In New York, the civil usury statute provides that "the maximum interest rate permissible on a loan is 16% per annum, and any interest rate in excess of that amount is usurious" (O'Donovan v Galinski, 62 AD3d 769, 769 [2d Dept 2009]; see General Obligations Law § 5-501 [1]; Banking Law § 14-a [1]). Criminal usury occurs when a person "knowingly charges, takes or receives any money or other property as interest on the loan or forbearance of any money or other property, at a rate exceeding twenty-five per centum per annum" (Penal Law § 190.40; see Venables v Sagona, 85 AD3d 904, 905 [2d Dept 2011]). A borrower bears the burden of proving each element of usury by clear and convincing evidence, and usury will not be presumed (Freitas v Geddes Sav. & Loan Assn., 63 NY2d 254, 261 [1984]).

Here, the defendant did not establish by clear and convincing evidence that the loan evidenced by the note was usurious. The defendant's motion for summary judgment dismissing the instant action is denied regardless of the sufficiency of the plaintiff's opposition papers (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]).

The branch of the motion by Shari Schieber, as the executrix of the estate of David Wishnick for an order pursuant to CPLR 3212 directing the entry of summary judgment in favor of plaintiff and against Patrick Brown on the first cause of action is denied.

The branch of the motion by Shari Schieber, as the executrix of the estate of David Wishnick for an order pursuant to CPLR 3212 granting summary judgment in favor of the plaintiff as against the defendant on the second cause of action as to liability is denied.

The branch of the motion by Shari Schieber, as the executrix of the estate of David Wishnick for an order pursuant to CPLR 3212 granting summary judgment in favor of the plaintiff as against the defendant dismissing defendant's affirmative defenses is granted in part and denied in part.

It is denied as to the first affirmative defense of failure to state a cause of action. It is granted as against all other affirmative defenses pursuant to CPLR 3211 (b).

The branch of the motion by Shari Schieber, as the executrix of the estate of David [*5]Wishnick for an order pursuant to CPLR 3212 granting summary judgment in favor of the plaintiff and dismissing the defendant's counterclaim is granted.

The cross-motion by defendant Patrick Brown for an order pursuant to CPLR 3212 granting summary judgment in favor of the defendant on the issue of liability and dismissing the complaint of Shari Schieber, as the executrix of the estate of David Wishnick is denied.

The foregoing constitutes the decision and order of this Court.