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

CITIBANK, N.A., respondent, v. Michael ROSEN, etc., appellant.

Decided: February 22, 1999

LAWRENCE J. BRACKEN, J.P., FRED T. SANTUCCI, WILLIAM D. FRIEDMANN and ANITA R. FLORIO, JJ. William J. Apuzzo, New York, N.Y., for appellant.

In an action on a guarantee, the defendant appeals from so much of an order of the Supreme Court, Nassau County (Burke, J.), dated March 26, 1998, as denied his motion to dismiss the complaint as time-barred pursuant to CPLR 3211(a)(5) and CPLR 213(2).

ORDERED that the order is reversed insofar as appealed from, with costs, the motion is granted, and the complaint is dismissed.

In mid-1989, when the defendant, Michael Rosen, was a principal of a corporation known as Progressive Personnel, Inc. (hereinafter Progressive), the plaintiff, Citibank, N.A. (hereinafter Citibank), provided Progressive with a $40,000 line of credit, secured, inter alia, by Rosen's personal guarantee.   As a result of internal struggles within the business, Rosen ceased to be president of Progressive on October 5, 1990, and was removed as an officer and director of the corporation on June 3, 1991.   Rosen promptly notified Citibank of these developments.   According to the Line of Credit Agreement between Progressive and Citibank dated August 16, 1989, Progressive “will be in default” of its Line of Credit Agreement, inter alia, “[i]f any Guarantor of this obligation * * * shall cease to be an officer, director or partner in the Borrower's business” (emphasis supplied).   Since the foregoing events occurred on or before June 3, 1991, and Citibank's cause of action against Progressive and/or Rosen accrued on or before that date, Citibank had six years, that is, until June 3, 1997, to commence an action to satisfy any outstanding debt under the parties' agreement (see, CPLR 213[2];  203[a];  General Phoenix Corp. v. Cabot, 300 N.Y. 87, 92, 89 N.E.2d 238;  North Fork Bank v. Healy, 224 A.D.2d 601, 638 N.Y.S.2d 671;  Marine Midland Bank v. Walter Perlstein, Inc., 175 A.D.2d 523, 524, 572 N.Y.S.2d 789;  Bayside Fuel Oil Depot Corp. v. Savino Oil & Heating Co., 133 A.D.2d 658, 660, 519 N.Y.S.2d 832;  Gazza v. United California Bank Intl., 88 A.D.2d 968, 969, 451 N.Y.S.2d 806).   The instant lawsuit to recover $48,219.92 in loans on which Progressive had defaulted, commenced by Citibank against Rosen alone in September 1997, was therefore time-barred (see, e.g., Kandilaris v. Lindover, 251 A.D.2d 76, 674 N.Y.S.2d 295).


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