Broader Loan Agreement And Assignment Do Not Preclude Summary Judgment In Lieu Of Complaint

Posted: March 11, 2026 / Written by: Joshua Wurtzel, Samuel L. Butt, Channing J. Turner, Thomas A. Kissane / Categories Summary Judgment in Lieu of Complaint, Assignment

Broader Loan Agreement And Assignment Do Not Preclude Summary Judgment In Lieu Of Complaint

On January 5, 2026, Justice Joel M. Cohen granted summary judgment in lieu of complaint under CPLR 3213. The case is TSLA Capitals, S.A.P.I. De C.V. v. ATL Funds, LLC, Index No. 654262/2025.

The Court explained:

TSLA has established a prima facie case for summary judgment in lieu of complaint by demonstrating that (i) Northlight Trust 1, predecessor by conversion to ATL, executed a promissory note in favor of Banco Azteca (see NYSCEF 4 [“Brum Aff”] at 2; NYSCEF 6 [the “Note”]), (ii) the Note contains an unconditional promise to pay in accordance with the terms therein (see Note at 1), (iii) Banco Azteca assigned all rights, title, and interest in various agreements, including the Note, to TSLA . . ., and (iv) ATL defaulted on the Note by failing to make payment as required . . ..

ATL contends that the Note does not qualify as an instrument for the payment of money because the events of default and the acceleration clause can only be ascertained by reference to external documents including the Credit Agreement and the Security Agreement . . .. However, the fact that a promissory note forms part of a broader loan agreement does not preclude relief under CPLR 3213 provided the defendant’s obligation to make payment is established by the note itself . . .. [Collecting cases]

ATL further contends that the Note is not an instrument for the payment of money only because it contains performance obligations in addition to ATL’s obligation to repay . . .. However, “the fact that a defendant guarantees both payment and performance obligations does not preclude the applicability of CPLR 3213 unless the performance obligations are a condition precedent to the plaintiff’s obligation to pay” (Truist Equipment Finance Corp. v Charles L Tebele, 2025 WL 3757603 at *3 [Sup Ct, NY County Dec 23, 2025] [citing Fortress Credit Corp. v Cohen, 235 AD3d 553, 554 [1st Dept 2025]). It is undisputed that the performance obligations were not conditions precedent to payment. ATL’s contention is therefore unavailing. . ..

Lastly, ATL contends that the assignment of the Note and related agreements from Banco Azteca to TSLA removes the Note from the scope of CPLR 3213 . . .. This argument is meritless. ATL cites no authority in support of its proposition, and this Court and the First Department routinely grant CPLR 3213 relief notwithstanding the assignment of the instruments or interests at issue (see Truist, supra, at *2).

Slip op., pp. 2-4.

Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning summary judgment in lieu of complaint or assignments.