Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

STATE BANK OF INDIA v. STAR DIAMONDS

October 25, 1995

STATE BANK OF INDIA, Plaintiff, against STAR DIAMONDS, INC., et al., Defendants.


The opinion of the court was delivered by: KAPLAN

 LEWIS A. KAPLAN, District Judge.

 Plaintiff, an agency or instrumentality of the Government of India, seeks to recover the unpaid balance of principal and interest due pursuant to promissory notes, a credit agreement, and certain personal guarantees. Jurisdiction is premised on alienage and the Foreign Sovereign Immunities Act. The matter is before the Court on plaintiffs motion for summary judgment.

 Facts

 On or about February 2, 1989, plaintiff granted defendant Star Diamonds, Inc. ("SDI") two demand loans aggregating $ 1 million. SDI executed demand notes evidencing this indebtedness, and its principals, Prakash and Kashmira Chauhan, executed personal guarantees. The rights and obligations of the parties were set forth in a Credit Agreement of even date.

 SDI defaulted almost immediately. In consequence, in March 1990, the loans were restructured to reduce the aggregate amount to $ 750,000 pursuant to a Credit Modification Agreement. SDI signed a reduced promissory note, and the Chauhans reaffirmed their unconditional personal guarantees.

 In May 1994, following additional defaults by the defendants, the loan was restructured yet again. Pursuant to a Restructuring Agreement, SDI acknowledged that, as of February 28, 1994, it was in default under the 1989 Credit Agreement and the 1990 Credit Modification Agreement and that it was indebted to plaintiff in the aggregate sum of $ 953,303. Plaintiff conditionally agreed that it would waive a portion of the past due interest ($ 46,303.50) provided SDI strictly complied with the prepayment and other terms of the Restructuring Agreement.

 The Restructuring Agreement obligated SDI to repay the sum of $ 907,000 within one year in full satisfaction of its then outstanding obligation to plaintiff, with interest payable on the first of each month at one percent above plaintiff's prime rate of interest. SDI executed a new demand note for $ 907,000, and the Chauhans again confirmed their previously executed guarantees. The Restructuring Agreement and the new note provided that plaintiff was entitled to declare the principal and all accrued interest due and payable in the event of a default, with interest at a default rate.

 Defendants acknowledge execution of all of the pertinent documents and that they "are in arrears in payment due to the Plaintiff pursuant to the loan documents..." (Chauhan Aff. P 13) They contend, however, that were unaware of the contents and implications of the documents they signed and, assuming that the loan documentation is enforceable, that the unpaid balance is less than plaintiff claims. They contend, moreover, that they should be afforded additional time for discovery with respect to the amount due to plaintiff.

 Discussion

 1. Defendants' claim that they did not read the loan documentation, even if credited, would be no defense. Indeed, defendants' papers do not seriously suggest that it is.

 Under New York law, a party is legally bound by his or her signature to a contract. The party is "conclusively presumed to know its contents and to assent to them." Metzger v. Aetna Insurance Co., 227 N.Y. 411, 416, 125 N.E. 814 (1920); accord, Gillman v. Chase Manhattan Bank, N.A., 73 N.Y.2d 1, 11, 537 N.Y.S.2d 787, 791-92, 534 N.E.2d 824 (1988); Columbus Trust Co. v. Campolo, 110 A.D.2d 616, 617, 487 N.Y.S.2d 105, 107 (2d Dept.), aff'd, 66 N.Y.2d 701, 496 N.Y.S.2d 425, 487 N.E.2d 282 (1985); see Brian Wallach Agency, Inc. v. Bank of New York; 75 A.D.2d 878, 879, 428 N.Y.S.2d 280, 282 (2d Dept. 1980).

 2. There is no genuine issue of fact as to the amount in dispute. The reply affidavit of Indrajit Gupta sets forth the computation in detail. The principal amount was $ 907,000. The interest for the period March 1 through April 25, 1994 was $ 101,785.54. Plaintiff concedes that defendants paid $ 56,400. The net amount of interest due therefore was $ 45,385.54 (i.e., $ 101,785.54 - $ 56,400). In addition, plaintiff is entitled to past due interest in the amount of $ 46,303.50, which was conditionally waived by the Restructuring ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.