Shawna M. Sosnovich

A defendant brought a motion to dismiss an action alleging fraudulent conveyance and to discharge a certificate of pending litigation registered against a matrimonial home.

The moving party argued that the claim was barred by a prior full and final release executed after settlement of related debts.

The court held that interpretation of the release required consideration of the surrounding circumstances and could not be determined without a trial, so dismissal of the action was refused.

However, the court found that the release was a material fact that should have been disclosed when leave to register the certificate of pending litigation was obtained.

Because of this non-disclosure, the certificate of pending litigation was discharged.

The plaintiff bank brought a motion for summary judgment to recover outstanding indebtedness under a revolving demand credit facility extended to a corporate borrower.

Corporate and individual defendants had executed guarantees securing the facility.

The individual guarantors argued the debt arose from a new loan issued in 2009 and therefore fell outside their 2002 guarantees, asserting the original loan had been paid off in 2008.

The court found the evidence established the facility was never extinguished and that the 2009 agreement merely reduced the credit limit rather than creating a new loan.

Given the guarantees covered all present or future indebtedness, the guarantors remained liable and summary judgment was granted.