Skrabalak v. Rock
| Decision Date | 20 October 1994 |
| Citation | 617 N.Y.S.2d 912,208 A.D.2d 1100 |
| Parties | Robert J. SKRABALAK et al., Respondents, v. Jerome F. ROCK, Appellant. |
| Court | New York Supreme Court — Appellate Division |
Ronald R. Benjamin (Kevin F. Guyette, of counsel), Binghamton, for appellant.
Richard J. Grace, Binghamton, for respondents.
Before MIKOLL, J.P., and CREW, WHITE, YESAWICH and PETERS, JJ.
Appeals (1) from an order of the Supreme Court (Rose, J.), entered December 23, 1992 in Broome County, which, inter alia, granted plaintiffs' motion to compel discovery, (2) from an order of said court, entered July 30, 1993 in Broome County, which granted plaintiffs' motion for summary judgment, and (3) from an order of said court, entered November 22, 1993 in Broome County, which denied defendant's motion to vacate a prior judgment of the court.
This action arises out of defendant's personal guarantee of performance regarding the management and purchase of a restaurant and bar in Broome County. On February 22, 1982, plaintiffs and Paul Darpino entered into an agreement entitled "Management Agreement and Option to Purchase" (hereinafter Management Agreement), by which Darpino was granted the right to operate the subject restaurant and bar pending his application for a liquor license. Such agreement further included the option to purchase such restaurant and bar once the license was issued to Darpino. Darpino thereafter assigned his interest in the agreement to J.M. Rock Inc.
By a subsequent document dated February 27, 1982, plaintiffs entered into a purchase agreement for the restaurant and bar with J.M. Rock Inc. This agreement was signed by James M. Rock on behalf of J.M. Rock Inc. In June 1982, defendant executed a guarantee of performance under which he agreed to "guarantee the performance of Paul Darpino and James M. Rock, Inc., as the assignee of the Management Agreement and Option to Purchase", and further agreed to "guarantee the performance of James M. Rock, Inc., pursuant to the terms of the Agreement to Purchase the Business * * * dated February 27, 1982".
The instant action was commenced in May 1990 alleging that Darpino and James M. Rock Inc. had defaulted under the terms of the Management Agreement. After issue was joined, plaintiffs moved to compel a deposition of defendant and defendant cross-moved for dismissal alleging a lack of personal jurisdiction. In finding that the court had personal jurisdiction and that defendant's sole basis for contesting plaintiffs' motion was the alleged lack of jurisdiction, Supreme Court granted plaintiffs' motion and denied defendant's cross motion.
Plaintiffs thereafter moved for summary judgment contending that the documentary evidence obligated defendant to be liable for a breach of the Management Agreement. Defendant conceded that he executed the subject guarantee but alleged that when Darpino assigned his interest thereunder, his obligation expired. Defendant further contended that while he guaranteed the obligations of James M. Rock Inc., he did not guarantee the performance of J.M. Rock Inc., the corporation actually referred to in the aforementioned agreements. Supreme Court rejected such contentions, granted summary judgment and denied defendant's request for depositions. Thereafter, defendant moved to vacate such judgment alleging that it was entitled to a trial on damages. Supreme Court denied defendant's motion and defendant now appeals from all such orders.
Addressing the issue of personal jurisdiction, we find that Supreme Court correctly determined that defendant's guarantee of an obligation to be performed in this State is sufficient to confer personal jurisdiction over defendant pursuant to CPLR 302(a)(1) (see, Rielly Co. v. Lisa B. Inc., 181 A.D.2d 269, 586 N.Y.S.2d 668; Fashion Tanning Co. v. Shutzer Indus., 108 A.D.2d 485, 489 N.Y.S.2d 791; see also, Peekskill Community Hosp. v. Graphic Media, 198 A.D.2d 337, 604 N.Y.S.2d 120).
Addressing next the award of summary judgment, we find that defendant's contentions that the assignment by Darpino constituted a substantial change in the nature of the entity that he guaranteed was appropriately rejected. Although a guarantor may be discharged from liability under a guarantee when there has been a substantial change in the nature of the guarantee (see, State of New York v. International Fid. Ins. Co., 152 A.D.2d 77, 547 N.Y.S.2d 466; Fehr Bros. v. Scheinman, 121 A.D.2d 13, 509 N.Y.S.2d 304), to determine whether such discharge has occurred:
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