On November 26, 2024, the First Department issued a decision in P1 Fin. v. Evergreen Bldrs. & Constr. Servs., Inc., 2024 NY Slip Op. 05897, holding that a motion for summary judgment in lieu of complaint cannot be based on a conditional agreement to pay, explaining:
Plaintiff commenced this action by motion for summary judgment in lieu of complaint pursuant to CPLR 3213, alleging that defendant owed money to it in connection with a premium finance agreement. To establish a prima facie case on a CPLR 3213 motion, a plaintiff must show the existence of a promissory note executed by the defendant containing an unequivocal and unconditional obligation to repay and the failure of the defendant to pay in accordance with the note’s terms. The prototypical example of an instrument within the ambit of CPLR 3213 is a negotiable instrument for the payment of money — an unconditional promise to pay a sum certain, signed by the maker and due on demand or at a definite time.
Here, plaintiff failed to establish its prima facie entitlement to summary judgment. While plaintiff asserts repeatedly that the Agreement contained an unconditional promise to repay the loaned amounts, the word unconditional does not appear in the relevant agreement, with defendant’s obligation to repay expressly conditioned on the contractual terms. The agreement provided, among other things, that plaintiff would be entitled to receive unearned premiums from the canceled insurance policy from defendant’s insurer (a nonparty to this action), and that defendant would be entitled to receive a credit for those amounts against any outstanding balance of the loan.
The Second Department has analyzed nearly identical language in a premium financing agreement and denied the plaintiff summary judgment in lieu of complaint because outside proof was required to determine if there is any deficiency after payment of the unearned premiums to the plaintiff. Here, there also remain issues surrounding the amount of unearned premiums received by plaintiff from defendant’s insurer, sums returned to plaintiff by the broker and/or insurer, and the overall amount owed directly by defendants — amounts that are disputed. This type of agreement does not qualify for summary treatment under CPLR 3213.
(Internal quotations and citations omitted).