Opinion
February 18, 1971
Two orders, Supreme Court, New York County, entered October 28, 1970 granting plaintiffs' motion for summary judgment and directing assessment of damages reversed, on the law, and motion denied, without prejudice to renewal after service of formal pleadings. Appellant shall recover of respondents $50 costs and disbursements of this appeal. This action on a promissory note was commenced by the service of a summons and notice of motion for summary judgment in lieu of a complaint. Plaintiffs are alleged to be principal stockholders of Benjamin Koondel, Inc. (Koondel, Inc.), a limited partner of defendant, an investment fund. It appears that a limited partner might withdraw its investment at the end of any calendar year but that such withdrawal at any other time might be had only with consent of a general partner. Defendant asserts that Koondel, Inc., sought permission to withdraw its investment as of October 1, 1969 in order to take advantage of a tax loss in its tax year ending October 31. Permission was granted and defendant gave Koondel, Inc., its demand promissory note for the estimated value of its interest. The note was assigned to plaintiffs. Defendant claims that its permission to withdraw the investment and its delivery of the note were induced by an oral agreement by plaintiffs to personally invest in the defendant cash in the amount of the note before demanding payment. While we agree with Special Term that the parol evidence rule forbids assertion of the alleged agreement as a defense to the note, the papers disclose the existence of potential counterclaims against one or both plaintiffs equal to the amount of the note. ( Sillman v. Twentieth Century-Fox, 3 N.Y.2d 395, 404; Illinois McGraw Elec. Co. v. Walters, 7 N.Y.2d 874.) Plaintiffs are directed to serve their complaint within 20 days from service of a copy of the order entered herein. ( Goodman v. Solow, 27 A.D.2d 920.)
I dissent and vote to affirm the order appealed from. The instrument sued upon is a full and complete promissory note, payable on demand, and no issue is raised with regard to the execution and delivery thereof. Defendant's claim that Benjamin Koondel, Inc., would not demand payment on the note until after the individual plaintiffs, who are the principal shareholders of Benjamin Koondel, Inc., had reinvested a sum equal to the money withdrawn from defendant in defendant, contradicts the express terms of the instrument itself and is, therefore, unavailable because it would violate the parol evidence rule ( American Bank Trust Co. v. Computer Prods., 36 A.D.2d 525). Nor is the existence of "potential" counterclaims which, at this stage of the proceedings, are unasserted and purely speculative, a bar to the relief sought by plaintiffs.