2 No. 153
Rosalind T. Spodek, &c.,
Respondent,
v.
Park Property Development Associates, &c.,
Appellant.
_________________________________________________________________
2001 NY Int. 121
November 15, 2001
This opinion is uncorrected and subject to revision before publication
in the New York Reports.
Kenneth M. Block, for appellant.
Robert M. Calica, for respondent.
_________________________________________________________________
GRAFFEO, J.:
In this breach of contract action, we address whether a creditor is
entitled to prejudgment interest under CPLR 5001 where the
promissory note provided for monthly interest and principal
installment payments on the debt owed. We conclude that plaintiff is
entitled to interest from the accrual of the cause of action on both
the unpaid interest and principal payments to the date liability was
fixed.
Defendant executed a note in April 1980, agreeing to pay plaintiff the
principal sum of $1,437,500 in connection with a real estate
transaction. Interest was to accrue at the rate of 8% per annum,
payable monthly. "For the first sixty (60) months interest only (was
to) be paid; in addition beginning with the sixty-first month
principal payments (were to) be made at the rate of 1% per annum"
until the remainder became due on December 31, 2000. Between 1980 and
1997 defendant made no payments. Conceding that an action on any sums
due prior to 1991 would be barred by the Statute of Limitations,
plaintiff commenced this litigation in 1997 seeking repayment of
principal and interest installments owed from 1991. After joinder of
issue, plaintiff moved for summary judgment, which Supreme Court
denied but the Appellate Division subsequently granted (see, 263 AD2d
478, lv denied , 94 NY2d 760).
Upon remand, Supreme Court awarded plaintiff $1,094,083.60,
representing interest owed for each month of default from August 1991,
SNIPPETS:
This opinion is uncorrected and subject to revision before publication in the New York
In this breach of contract action, we address whether a creditor is entitled to prejudgment
We conclude that plaintiff is entitled to interest from the accrual of the cause of action on
Defendant executed a note in April 1980, agreeing to pay plaintiff the principal sum of
"For the first sixty months interest only be paid; in addition beginning with the sixty-first
Conceding that an action on any sums due prior to 1991 would be barred by the Statute of
After joinder of issue, plaintiff moved for summary judgment, which Supreme Court denied but
Compound interest is commonly defined as "interest on interest" or interest that is "paid on
Although the bond required payment of simple interest, plaintiff attempted to recover
the Court rejected plaintiff's attempt to recover compound interest because there was no
The issue in Giventer was whether a promissory note that provided for interest at 7½%
Noting that the effective annual rate of interest on this note exceeded the maximum rate of
Chief Judge Cardozo succinctly explained the rationale for this approach in Prager v New
"While the dispute as to value was going on, the defendant had the benefit of the money, and
Contrary to plaintiff's contention that this appeal is from the amended judgment of Supreme
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