Court Opinion

ID: 9954319
Source: CourtListenerOpinion
Date Created: 2024-03-25 21:11:18.220447+00
Date Added: 2024-06-11T08:12:04.601401
License: Public Domain

Clarke v Alabama Mar. Asset Holdings, LLC
               2024 NY Slip Op 30914(U)
                     March 19, 2024
           Supreme Court, New York County
        Docket Number: Index No. 653874/2021
                  Judge: Joel M. Cohen
Cases posted with a "30000" identifier, i.e., 2013 NY Slip
 Op 30001(U), are republished from various New York
 State and local government sources, including the New
  York State Unified Court System's eCourts Service.
 This opinion is uncorrected and not selected for official
                       publication.
 [FILED: NEW YORK COUNTY CLERK 03/19/2024 04:56 P~                                                                      INDEX NO. 653874/2021
  NYSCEF DOC. NO. 22                                                                                              RECEIVED NYSCEF: 03/19/2024

            SUPREME COURT OF THE STATE OF NEW YORK
            COUNTY OF NEW YORK: COMMERCIAL DIVISION PART 03M
            ----------------------------------------------------------------------------------- X

             THOMAS M CLARKE, ANA M CLARKE                                                          INDEX NO.         653874/2021

                                                          Plaintiffs,
                                                                                                    MOTION DATE        12/26/2023
                                                - V -
                                                                                                    MOTION SEQ. NO.        001
             ALABAMA MARITIME ASSET HOLDINGS, LLC,

                                                          Defendant.                                 DECISION+ ORDER ON
                                                                                                           MOTION
            ----------------------------------------------------------------------------------- X

            HON. JOEL M. COHEN:

            The following e-filed documents, listed by NYSCEF document number (Motion 001) 12, 13, 14, 15, 16,
            17, 18, 19, 20, 21
            were read on this motion for                                                 SUMMARY JUDGMENT

                      Defendant Alabama Maritime Asset Holdings, LLC' s ("Defendant") unopposed motion

            for summary judgment is granted to the extent that Plaintiffs Thomas M. Clarke's and Ana M.

            Clarke's ("the Clarkes" or "Plaintiffs") Complaint is dismissed. Defendant's motion for

            summary judgment is denied with respect to Defendant's Counterclaim, which is dismissed.

                A. Background

                      In 2018, non-party BAE Systems Southeast Shipyards AMCH Inc. ("BAE"), as seller,

            entered into a purchase and sale transaction with Defendant Alabama Maritime Asset Holdings,

            LLC's ("Alabama Maritime" or "Defendant") predecessor, Epic Maritime Asset Holdings, LLC

            ("Epic"), as buyer, to sell a shipyard ("Alabama Shipyard"). Defendant provided BAE with a

            promissory note in the amount of $10,000,000 ("Note" [NYSCEF 3]) as part of the Alabama

            Shipyard transaction. The Note is subordinated to certain senior loans under the terms of a

            Subordination Agreement (NYSCEF 5).

             653874/2021 CLARKE, THOMAS M vs. ALABAMA MARITIME ASSET                                                    Page 1 of4
             Motion No. 001

[* 1]                                                                       1 of 4
 [FILED: NEW YORK COUNTY CLERK 03/19/2024 04:56 P~                                              INDEX NO. 653874/2021
  NYSCEF DOC. NO. 22                                                                    RECEIVED NYSCEF: 03/19/2024

                   Plaintiffs executed a Personal Guarantee ("Guaranty" [NYSCEF 4]) of the principal and

            interest under the Note (the "Guaranteed Obligations"). The Guaranty is "an absolute,

            unconditional and continuing guaranty of payment of the Guaranteed Obligations ... " The

            Guaranty includes the following condition precedent to claims by Plaintiffs against Defendant:

                   Until all of the Guaranteed Obligations shall have been paid in full, the Guarantor hereby
                   agrees not to assert the rights that the Guarantor may now have or hereafter acquire,
                   whether by subrogation, contribution, reimbursement, recourse, exoneration, contract or
                   otherwise, to recover from the Maker [Defendant] or from any property of the Maker
                   [Defendant] any sums paid under this Guaranty.

                   Defendant defaulted on the Note resulting in multiple lawsuits. First, in 2020, BAE

            commenced an action against Epic on the Note. On February 10, 2021, the Court granted

            summary judgment in favor of Epic because BAE is prohibited from enforcing the Note until the

            senior loans are satisfied under the terms of the Subrogation Agreement (BAE Sys. Southeast

            Shipyards AMHC Inc. v Epic Mar. Asset Holdings, LLC, 2021 N.Y. Slip Op. 30416[U], 1 [N.Y.

            Sup Ct, New York County 2021]).

                   Second, also in 2020, BAE commenced an action against the Clarkes to enforce the

            Guaranty (BAE Systems Southeast Shipyards AMHC Inc. v. Thomas M Clarke and Ana M

            Clarke, [Index No. 651486/2020]). On January 22, 2201, the Court granted summary judgment

            in favor of BAE on its Guaranty claim (NYSCEF 7 [Tr. 16-26]; NYSCEF 6 [March 26, 2021,

            Judgment]).

                   Third, on June 17, 2021, Plaintiffs filed their Verified Complaint (NYSCEF 2) in this

            action against Defendant asserting claims for Common Law Exoneration and Quia Timet (a

            common law injunction against future harm). Generally, Plaintiffs seek a judgment requiring

            Defendant to satisfy the Note and any debts that become due on the Note. On July 23, 2021,

            Defendant filed a Verified Answer with Counterclaim for breach of the Guaranty (NYSCEF 11).

             653874/2021 CLARKE, THOMAS M vs. ALABAMA MARITIME ASSET                            Page 2 of 4
             Motion No. 001

[* 2]                                                    2 of 4
 [FILED: NEW YORK COUNTY CLERK 03/19/2024 04:56 P~                                                INDEX NO. 653874/2021
  NYSCEF DOC. NO. 22                                                                      RECEIVED NYSCEF: 03/19/2024

            Plaintiffs have not replied to the Counterclaim or otheiwise made any filings since the

            Complaint.

               B. Discussion

                   In support of a motion for summary judgment under CPLR 3212, the movant must make

            a prima facie showing of entitlement to judgment as a matter oflaw, tendering sufficient

            evidence to demonstrate the absence of any material issues of fact (Alvarez v. Prospect Hospital,

            68 N.Y.2d 320 [1986]). If the movant successfully demonstrates its prima facie entitlement to

            summary judgment as a matter of law, the burden of proof shifts to the party opposing the

            motion (Winegrad v. New York University Medical Center, 64 N.Y.2d 851, 853 [1985]).

                   The Note and Guaranty were annexed to the Verified Complaint. The Guaranty includes

            a clear and unambiguous condition precedent requiring that Plaintiffs pay the Guaranteed

            Obligations before asserting claims, including claims for exoneration, against Defendant

            ( Greenfield v Philles Records, Inc., 98 NY2d 562, 569 [2002]). The Complaint alleges that there

            is an "unpaid principal balance ... plus accrued and unpaid interest" on the Note establishing that

            Plaintiffs have not complied with the condition precedent. Plaintiffs have not filed opposition to

            Defendant's motion to rebut the prima facie case for dismissal. Accordingly, summary judgment

            dismissing the Complaint for failure to comply with the express condition precedent is warranted

            (Oppenheimer & Co., Inc. v Oppenheim, Appel, Dixon & Co., 86 NY2d 685, 690 [1995]; ALJ

            Capital L L.P. v David J Joseph Co., 48 AD3d 208 [1st Dept 2008]).

                   Summary judgment is denied with respect to Defendant's Counterclaim for breach of the

            Guaranty, which is dismissed. Defendant seeks damages including the "costs, disbursements and

            legal fees incurred in defending this action." However, Defendant is a not a party to the

            Guaranty. Even if Defendant was a party to the Guaranty, there is no contractual provision or

             653874/2021 CLARKE, THOMAS M vs. ALABAMA MARITIME ASSET                              Page 3 of 4
             Motion No. 001

[* 3]                                                     3 of 4
 !FILED: NEW YORK COUNTY CLERK 03/19/2024 04: 56 PM!                                                INDEX NO. 653874/2021
  NYSCEF DOC. NO. 22                                                                          RECEIVED NYSCEF: 03/19/2024

            statute that permits for the recovery of attorney's fees ( City ofNew York v Zuckerman, 234

            AD2d 160, 161 [1st Dept 1996]). Upon searching the record, the Court dismisses Defendant's

            Counterclaim (CPLR 3212[b]).

                                                   *      *       *         *
                    Accordingly, it is

                    ORDERED that Defendant's motion for summary judgment is GRANTED to the extent

            that the Complaint is DISMISSED with prejudice; it is further

                    ORDERED that Defendant's motion for summary judgment on its Counterclaim is

            DENIED and, upon searching the record, the Court GRANTS summary judgment in favor of

            Plaintiffs and the Counterclaim is DISMISSED with prejudice; it is further

                    ORDERED that the Clerk enter judgment dismissing the Complaint and the

            Counterclaim with prejudice, without costs to either party.

                    This constitutes the decision and order of the Court.

                    3/19/2024
                      DATE                                                         JOEL M. COHEN, J.S.C.

                                                                      ~
             CHECK ONE:                  CASE DISPOSED                    NON-FINAL DISPOSITION

                                         GRANTED         □ DENIED         GRANTED IN PART          □ OTHER
             APPLICATION:                SETTLE ORDER                     SUBMIT ORDER

             CHECK IF APPROPRIATE:       INCLUDES TRANSFER/REASSIGN       FIDUCIARY APPOINTMENT    □ REFERENCE

             653874/2021 CLARKE, THOMAS M vs. ALABAMA MARITIME ASSET                                Page4 of 4
             Motion No. 001

[* 4]                                                      4 of 4