First Nat. Bank of Amenia v. Mountain Food Enterprises, Inc.

CourtNew York Supreme Court Appellate Division
Writing for the CourtBefore WEISS; YESAWICH; WEISS
Citation553 N.Y.S.2d 233,159 A.D.2d 900
Decision Date29 March 1990
PartiesFIRST NATIONAL BANK OF AMENIA, Appellant-Respondent, v. MOUNTAIN FOOD ENTERPRISES, INC., et al., Respondents, and Frank Papandrea et al., Respondents-Appellants.

Page 233

553 N.Y.S.2d 233
159 A.D.2d 900
FIRST NATIONAL BANK OF AMENIA, Appellant-Respondent,
v.
MOUNTAIN FOOD ENTERPRISES, INC., et al., Respondents,
and
Frank Papandrea et al., Respondents-Appellants.
Supreme Court, Appellate Division,
Third Department.
March 29, 1990.

Page 234

Parshall & West (Marvin Parshall, of counsel), Worcester, for appellant-respondent.

Philip J. Devine, Oneonta, for respondents-appellants.

Before WEISS, J.P., and MIKOLL, YESAWICH, MERCURE and HARVEY, JJ.

YESAWICH, Justice.

Cross appeals from an order of the Supreme Court (Coutant, J.), entered March 10, 1989 in Chenango County, which denied motions by various parties for summary judgment.

Plaintiff, a national bank, loaned defendants Frank Papandrea, Maria Papandrea and Mountain Food Enterprises, Inc. (hereinafter MFE), of which Frank Papandrea is the sole shareholder, $150,000 with a total annual interest percentage rate of 17.23%. The note evidencing the loan was secured by a mortgage on three of the Papandreas' properties. The Papandreas made only two of the scheduled payments, and thereafter, on July 27, 1987, they and MFE filed for bankruptcy. On April 22, 1988, plaintiff commenced this foreclosure action; MFE and the Papandreas, in their joint answer with counterclaims, alleged, among other things, that the mortgage note was usurious. Plaintiff, claiming that the interest rate was well below the 25% legal interest rate on a mortgage loan to a corporation, then sought summary judgment. MFE and the Papandreas cross-moved for the same relief. Supreme Court denied both motions and these cross appeals ensued. While we agree with the Supreme Court that a question of fact exists concerning whether the Papandreas signed the loan agreement as guarantors or coborrowers, we are of the view that plaintiff is entitled to partial summary judgment.

The maximum rate of interest is 16% per annum for an individual borrower (12 U.S.C. § 85; General Obligations Law § 5-501[1]; Banking Law § 14-a[1] and 25% for a corporation (General Obligations Law § 5-521; Penal Law § 190.40). Where the interest rate charged does not violate the criminal usury statute (Penal Law § 190.40), neither a corporation nor the individual guarantor may interpose a usury defense in any action (General Obligations Law § 5-521[1]; Schneider v. Phelps, 41 N.Y.2d 238, 242, 391 N.Y.S.2d 568, 359 N.E.2d 1361), unless the loan was actually made to the guarantor as an individual to discharge personal...

To continue reading

Request your trial
50 practice notes
  • Pompa v. Burroughs Wellcome Co.
    • United States
    • New York Supreme Court Appellate Division
    • October 21, 1999
    ...Fin. Corp. v. Matthews of Scotia, 178 A.D.2d 691, 692 n. 1, 576 N.Y.S.2d 939; First Natl. Bank of Amenia v. Mountain Food Enters., 159 A.D.2d 900, 901, 553 N.Y.S.2d 3 Plaintiffs contend that defendant's July 1993 report was intended to disclose information to the FDA. ...
  • Slomin v. Skaarland Const. Corp.
    • United States
    • New York Supreme Court Appellate Division
    • August 25, 1994
    ...of action, other than negligence, against Skaarland Homes and Manor Homes (see, First Natl. Bank of Amenia v. Mountain Food Enters., 159 A.D.2d 900, 901, 553 N.Y.S.2d In so addressing the alleged negligence of Skaarland Homes and Manor Homes, we find that the conflicting expert affidavits a......
  • Stuart v. Porcello
    • United States
    • New York Supreme Court Appellate Division
    • November 10, 1993
    ...of his motion for reconsideration and, therefore, this issue has been waived (see, First Natl. Bank of Amenia v. Mountain Food Enters., 159 A.D.2d 900, 901, 553 N.Y.S.2d 233). Moreover, Supreme Court properly treated the motion as a motion to reargue, the denial of which is not appealable (......
  • Salvador v. State
    • United States
    • New York Supreme Court — Appellate Division
    • November 3, 1994
    ...Rabideau v. Albany Med. Ctr. Hosp., 195 A.D.2d 923, 926 n. 1, 600 N.Y.S.2d 825; First Natl. Bank of Amenia v. Mountain Food Enters., 159 A.D.2d 900, 901, 553 N.Y.S.2d 233). Furthermore, to the extent petitioners now contend that the challenged laws should be annulled because they violate or......
  • Request a trial to view additional results
50 cases
  • Pompa v. Burroughs Wellcome Co.
    • United States
    • New York Supreme Court Appellate Division
    • October 21, 1999
    ...Fin. Corp. v. Matthews of Scotia, 178 A.D.2d 691, 692 n. 1, 576 N.Y.S.2d 939; First Natl. Bank of Amenia v. Mountain Food Enters., 159 A.D.2d 900, 901, 553 N.Y.S.2d 3 Plaintiffs contend that defendant's July 1993 report was intended to disclose information to the FDA. ...
  • Slomin v. Skaarland Const. Corp.
    • United States
    • New York Supreme Court Appellate Division
    • August 25, 1994
    ...of action, other than negligence, against Skaarland Homes and Manor Homes (see, First Natl. Bank of Amenia v. Mountain Food Enters., 159 A.D.2d 900, 901, 553 N.Y.S.2d In so addressing the alleged negligence of Skaarland Homes and Manor Homes, we find that the conflicting expert affidavits a......
  • Stuart v. Porcello
    • United States
    • New York Supreme Court Appellate Division
    • November 10, 1993
    ...of his motion for reconsideration and, therefore, this issue has been waived (see, First Natl. Bank of Amenia v. Mountain Food Enters., 159 A.D.2d 900, 901, 553 N.Y.S.2d 233). Moreover, Supreme Court properly treated the motion as a motion to reargue, the denial of which is not appealable (......
  • Salvador v. State
    • United States
    • New York Supreme Court — Appellate Division
    • November 3, 1994
    ...Rabideau v. Albany Med. Ctr. Hosp., 195 A.D.2d 923, 926 n. 1, 600 N.Y.S.2d 825; First Natl. Bank of Amenia v. Mountain Food Enters., 159 A.D.2d 900, 901, 553 N.Y.S.2d 233). Furthermore, to the extent petitioners now contend that the challenged laws should be annulled because they violate or......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT