Anonymous v. Anonymous
172 A.D.2d 285 (1991)
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Rule of Law:
A new promise to pay a debt or an acknowledgment of a debt implying an intention to pay, made in writing and signed by the debtor, revives the debt and causes the statute of limitations to run anew from the date of the new promise or acknowledgment, notwithstanding any antedating of the instrument to avoid the limitation period.
Facts:
- Plaintiff-wife had loaned defendant-husband various amounts of money over many years.
- On July 9, 1975, plaintiff-wife insisted that defendant-husband provide her with "IOU's" (promissory notes) for the accumulated past loans before she would consider advancing him additional funds.
- Defendant-husband subsequently executed and delivered eight promissory notes to plaintiff-wife, totaling $116,177.
- Defendant-husband intentionally antedated these eight notes to bear dates in the years 1961, 1967, 1968, and 1969, rather than their actual date of issuance on July 9, 1975.
- The defendant's promissory note book showed that the eight notes in question, despite their antedated terms, were sequentially issued after other notes dated March 1, 1975, May 1, 1975, June 1, 1975, and June 25, 1975, and before a note dated July 9, 1975, confirming their actual issuance post-June 1975.
Procedural Posture:
- Plaintiff-wife and defendant-husband were involved in five separate actions.
- These five actions were consolidated for a trial in the Supreme Court, New York County (trial court), presided over by Justice Harold Baer, Jr.
- The trial court issued three separate judgments, including a judgment entered April 5, 1990, which denied and dismissed plaintiff-wife's motion for summary judgment on eight promissory notes executed by defendant-husband in her favor, on the grounds that the action was time-barred.
- Plaintiff-wife appealed the judgment entered April 5, 1990, to the Supreme Court, Appellate Division, First Department, seeking to overturn the dismissal of her claim on the promissory notes.
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Issue:
Does the statute of limitations for a promissory note accrue from its antedated face date or from its actual date of issuance when the debtor's act of issuing the note constitutes a revival of prior debts under General Obligations Law § 17-101?
Opinions:
Majority - Per Curiam
No, the statute of limitations for the promissory notes in question did not accrue from their antedated face dates, but rather from their actual date of issuance on July 9, 1975, because the defendant's act of issuing the notes constituted a revival of the prior debts. The court affirmed the trial court's factual finding that the date of issuance was July 9, 1975, a finding supported by the sequential order of notes in the defendant's book. While Uniform Commercial Code § 3-122 (1) (b) generally states that a cause of action on a demand instrument accrues "upon its date or, if no date is stated, on the date of issue," the court held that General Obligations Law § 17-101 provided an exception. This statute permits a signed writing by the debtor to revive an action otherwise barred by the statute of limitations if it constitutes a new promise to pay or an acknowledgment of the debt implying an intention to pay. The defendant's execution and delivery of the notes on July 9, 1975, in response to the plaintiff's insistence, served as a new promise and acknowledgment, thereby reviving the earlier debts and causing the statute of limitations to run anew from that date. Furthermore, the court interpreted the defendant's antedating of the notes to make them appear time-barred as an exploitation of the confidential husband-wife relationship and declined to permit him to benefit from such an act.
Analysis:
This case significantly clarifies the interplay between the Uniform Commercial Code's accrual rules for demand instruments and New York's General Obligations Law regarding debt revival. It establishes that a written acknowledgment or new promise to pay can effectively reset the statute of limitations, even when the instrument itself is deliberately antedated. The decision also underscores the court's equitable power to prevent a party from benefiting from manipulative actions that exploit confidential relationships, particularly within marital contexts. This precedent offers protection against debtors attempting to evade obligations through deceptive dating of financial instruments and reinforces the principle that substance over form prevails when a clear intention to pay is demonstrated.
