CPLR § 3218 Judgment by confession
Shasho v Pruco Life Ins. Co. of N.J., 2009 NY Slip Op 08000 (App. Div., 2nd, 2009)
The plaintiff seeks a preliminary injunction based, in part, on her contention that the confession of judgment was obtained in connection with a usurious promissory note. "No law regulating the maximum rate of interest which may be charged, taken or received shall apply to any loan or forebearance in the amount of two million five hundred thousand dollars or more" (General Obligations Law § 5-501[b]). Thus, the plaintiff failed to establish a likelihood of success on her claim that a promissory note that she and her late husband executed in favor of the defendant, and upon which the confession of judgment was predicated, is usurious, as the face of the note provides that the amount owed was $3,500,000 (see General Obligations Law 5-501[b]; Tides Edge Corp. v Central Fed. Sav., 151 AD2d 741; see also Ujueta v Euro-Quest Corp., 29 AD3d 895; Hochman v LaRea, 14 AD3d 653, 654). Moreover, the confession of judgment was signed and notarized on December 31, 2005, and, thus, at the time that the Supreme Court determined that branch of plaintiff's motion which was for a preliminary injunction, the three-year period for filing the confession of judgment (see CPLR 3218[b]) had yet to lapse. Consequently, the Supreme Court properly denied that branch of the plaintiff's motion which was for a preliminary injunction enjoining the defendant from entering, filing, and enforcing the confession of judgment. Further, the Supreme Court properly permitted the release of the proceeds from certain life insurance policies to the defendant.
Nonetheless, the defendant failed to file the confession of judgment by December 31, 2008, and thus failed to file it within three years after the plaintiff's affidavit of confession was executed. Accordingly, the confession of judgment became void after that date (see CPLR 3218[b]; Ray v Ray, 61 AD3d 442, 443). Thus, in the order dated March 12, 2009, the Supreme Court erred in granting that branch of the defendant's application which was, in effect, to permit him to enter, file, and enforce the confession of judgment.
The bold is mine