The following e-filed documents, listed by NYSCEF document numbers (Motion 003) 68, 69, 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 101, and 102 were read on this motion by defendant for SUMMARY JUDGMENT, and cross-motion by plaintiffs for summary judgment. DECISION + ORDER ON MOTION Upon the foregoing documents, it is hereby ORDERED that defendant’s motion for summary judgment is granted, and plaintiffs’ cross-motion for a stay of the action and for summary judgment upon a lifting of stay, is denied, for the reasons set forth in the moving and reply papers (NYSCEF Doc. Nos. 70, 75-76, 101), and the exhibits attached thereto, in which the court concurs, as summarized herein. Plaintiffs are the holders of two promissory notes from defendant, each dated April 27, 200,7 and maturing on April 27, 2010 (promissory notes, NYSCEF Doc. Nos. 22, 23). Each note may also be convertible into shares of defendant at plaintiffs’ behest, which option lacks a specific end date. It is undisputed that plaintiffs did not attempt to exercise their conversion rights until July of 2020 (conversion notices, NYSCEF Doc. Nos. 4, 10). An action for breach of contract carries a six-year statute of limitations (CPLR 213 [2]). Thus, any claim for breach of the notes runs from maturity of the notes (Cadlerock, L.L.C. v. Renner, 72 AD3d 454, 454 [1st Dept 2010] ["the applicable six-year statute of limitations began to run on the date on which each installment became due and payable"]). Plaintiffs, in opposition and in support of their cross-motion, argue that there is no comparable end date stated in the notes for their conversion rights. But plaintiffs’ reading of the notes defies logic, as it would allow plaintiffs, even decades into the future, to demand shares in the company long after they had lost the right to demand repayment of the loan. Courts should interpret contracts so as to avoid absurd results (Rubin v. Baumann, 148 AD3d 556, 556 [1st Dept 2017]). The plain reading of the notes — and the only construction of them that could be reasonable — is that both repayment and conversion are governed by the same maturity date. The absence of a specific end date for the conversion rights in the text is no bar, as in the absence of such a term the court may infer one (Haines v. City of New York, 41 NY2d 769, 772 [1977] ["We reject, as did the courts below, the plaintiff's contention that the city is perpetually bound under the agreement"]). Based on that precept, the court reasonably interprets the parties’ agreement as fixing the plaintiffs’ conversion option deadline as equivalent to the notes’ maturity date, which was April 27, 2010 — more than six years prior to the commencement of this action on November 16, 2020, rendering this action time-barred. In light of the foregoing disposition, dismissing the action as time-barred, as well as the court’s decision under Motion Sequence No. 004 substituting plaintiff David R. Sun as administrator for the estate of plaintiff Richard A. Sun, deceased (NYSCEF Doc. No. 96), that portion of plaintiffs’ cross-motion seeking a stay of the action due to the death of plaintiff Richard A. Sun (and for summary judgment upon a lifting of stay) is denied as moot. Accordingly, it is further ORDERED that the Clerk of the Court is directed to enter judgment in favor of defendant dismissing the action. This constitutes the decision and order of the court. CHECK ONE: X CASE DISPOSED NON-FINAL DISPOSITION X GRANTED DENIED GRANTED IN PART OTHER APPLICATION: SETTLE ORDER SUBMIT ORDER CHECK IF APPROPRIATE: INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT REFERENCE Dated: November 25, 2024
