Summary Judgment In Lieu Of Complaint Granted Against Borrower And Guarantor As To Liability, Denied As to Attorneys’ Fees

Posted: September 26, 2025 / Written by: Jeffrey M. Eilender, Thomas A. Kissane, Samuel L. Butt, Channing J. Turner, Joshua Wurtzel / Categories Summary Judgment in Lieu of Complaint, Breach of Contract, Guaranty , Attorney Fees

Summary Judgment In Lieu Of Complaint Granted Against Borrower And Guarantor As To Liability, Denied As to Attorneys’ Fees

On July 29, 2025, Justice Melissa A. Crane granted summary judgment in lieu of complaint on a $1 million loan agreement, and denied summary judgment as to attorneys’ fees. The case is Katragadda v. EIP Global Fund LLC, Index No. 655836.

CPLR 3213 “provides for accelerated judgment where the instrument sued upon is for the payment of money only and the right to payment can be ascertained from the face of the document without regard to extrinsic evidence, ‘other than simple proof of nonpayment or a similar de minimis deviation from the face of the document’" Slip op., p. 1 (citation omitted.) Plaintiff sought such relief against both EIP Global Fund and against Sridhar Chityala, whom it alleged had signed as guarantor in his individual capacity, and sought both repayment of the loan amount with interest, and attorneys’ fees.

Defendants argued that 3213 treatment would be improper for three reasons. First, the court would have to resort to extrinsic evidence because the loan agreement did not contain an interest rate; second, Chityala did not sign in his individual capacity; and third, neither the loan agreement, nor any statute, provided for attorneys’ fees.

Justice Crane rejected the first two arguments and granted summary judgment as to liability:

New York's statutory rate applies as the default rate given the absence of a provision within the Agreement addressing the applicable interest rate. Therefore, Defendants' assertion that extrinsic evidence is required to determine an amount of interest is erroneous. . . .

The Agreement clearly reflects that Chityala meant to bind himself personally. It contains a provision explicitly stating that "[t]his loan is guaranteed by the personal assets of Sridhar Chityala." Moreover, Chityala expressly recognized in the Agreement that he was individually liable: "each of the undersigned understands that they are each as individuals responsible." Thus, the guarantor provision is a stand-alone provision expressly providing for Chityala's liability in the event of default.

Slip op. 2-3 (citing Ross v. Ross Metals Corp., 111 A.D.3d 695, 478, 488 (2nd Dep't 2013), quoting loan agreement.)

She accepted the third argument, however:

There is no provision providing for the recovery of these fees within the agreement. "[A] prevailing party may not recover attorneys' fees from the losing party except where authorized by statute, agreement, or court rule.”

Slip op., p. 3 (citation omitted).

Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning loan agreements, guaranties, summary judgment or attorneys’ fees.