Citibank, N.A. v. URI Schwartz & Sons Diamonds Ltd.

• Decision Date: 10 July 2012
• Citation: 97 A.D.3d 444,2012 N.Y. Slip Op. 05482,948 N.Y.S.2d 275
• Parties: CITIBANK, N.A., Plaintiff–Appellant, v. URI SCHWARTZ & SONS DIAMONDS LTD., etc., et al., Defendants–Respondents.
• Court: New York Supreme Court — Appellate Division

97 A.D.3d 444
948 N.Y.S.2d 275
2012 N.Y. Slip Op. 05482

CITIBANK, N.A., Plaintiff–Appellant,
v.
URI SCHWARTZ & SONS DIAMONDS LTD., etc., et al., Defendants–Respondents.

Supreme Court, Appellate Division, First Department, New York.

July 10, 2012.

[948 N.Y.S.2d 277]

Platzer, Swergold, Karlin, Levine, Goldberg & Jaslow, LLP, New York (Steven D. Karlin of counsel), for appellant.

Schiller Law Group, P.C., New York (Ben Kinzler of counsel), for Uri Schwartz & Sons Diamonds, Ltd., respondent.

The Law Office of Sheldon Eisenberger, New York (Sheldon Eisenberger of counsel), for Zvi Ben Yosef, respondent.

MAZZARELLI, J.P., CATTERSON, DeGRASSE, RICHTER, MANZANET–DANIELS, JJ.

[97 A.D.3d 444]Order, Supreme Court, New York County (Richard B. Lowe, III, J.), entered October 20, 2010, which, to the extent appealed from as limited by the briefs, denied plaintiff's motion for summary judgment in its favor as against defendants, unanimously modified, on the law, to grant plaintiff's motion for summary judgment as against defendant Zvi Ben Yosef, as to liability, and remand the matter for an inquest on damages, and otherwise affirmed.

[97 A.D.3d 445]In an action for breach of contract, account stated, unjust enrichment and breach of guaranty against corporate defendant Uri Schwartz & Sons Diamonds, Ltd. (Schwartz) and individual defendant Zvi Ben Yosef (Ben Yosef), plaintiff Citibank seeks to recover damages under the terms of a loan agreement and a personal guarantee, both executed by Ben Yosef in November 2007. Schwartz is the New York sales office for, and owner and operator of, A. Schwartz & Sons, a wholesale diamond distribution company incorporated in Israel with its main office in Israel. Ben Yosef was employed by Schwartz as the New York office sales manager and was responsible for making sales, supervising other salespersons, and providing daily reports to A. Schwartz & Sons.

In November 2007 Ben Yosef met with a representative from Citibank to discuss banking business between Schwartz and Citibank. During the meeting, Ben Yosef executed a loan agreement for $250,000 and a personal guarantee. The loan agreement lists Schwartz as the business applicant and Ben Yosef as the “Owner” of Schwartz, and Ben Yosef signed this document as “Owner.” The personal guarantee is at the end of the loan agreement and is setoff with the heading “Personal Guarantee and Collateral Agreement.” Directly above the signature line it is again noted that the individual signing the agreement is personally agreeing to the terms of the personal guarantee and all other terms and conditions set forth. Ben Yosef signed and printed his name on the personal guarantee signature line.

Thereafter, in December 2007, funds were drawn under the loan agreement in the amount of $131,162.08 and $100,000, and deposited into a Citibank account allegedly controlled by Schwartz and...