ESSEX CEMENT COMPANY LLC v. Michael Falco, Defendant–Appellant. (2021)

Order, Supreme Court, New York County (Andrew Borrok, J.), entered on or about March 11, 2020, which, to the extent appealed from, granted plaintiff's motion for summary judgment on its cause of action for enforcement of a personal guaranty executed by defendant Falco, unanimously affirmed, with costs.

Plaintiff established prima facie that defendant Falco is liable for debts owed to it by defendant X–Treme Ready Mix, Inc. pursuant to the personal guaranty contained in the “Application for Business and Credit Agreement” that he signed as X–Treme's president (the original guaranty).  In opposition, Falco failed to raise an issue of fact.

Falco admits that he signed the agreement, but argues that the original guaranty was later rescinded by plaintiff when its sales representative asked him to sign a “Continuing Guaranty” and then, shortly after he refused to do so, advised him not to worry about it because it had been taken care of.  He contends that issues of fact exist whether the sales representative's statement that he did not have to sign the Continuing Guaranty meant that plaintiff had also rescinded the original guaranty and whether he reasonably relied on that representation to believe that he no longer was personally liable for X–Treme's debts to plaintiff.

This argument is without merit.  The original guaranty, which provided that it was “a continuing guaranty, unless terminated in writing,” was never terminated.  Thus, regardless of the events surrounding the Continuing Guaranty (on which Falco says someone forged his signature), the original guaranty remains in full force and effect (see generally MPEG LA, LLC v. Samsung Elecs. Co., Ltd., 166 A.D.3d 13, 17, 86 N.Y.S.3d 4 [1st Dept. 2018], lv denied 32 N.Y.3d 912, 2018 WL 6543038 [2018]).