G3-Purves Street, LLC v. Thomson Purves, LLC

OPINION OF THE COURT

Florio, J.P.

On these appeals, we are called upon to determine whether a provision of the guaranty at issue, which allowed for full recourse liability against the guarantors upon the happening of a “springing recourse event” under the attendant loan agreement, is, in effect, a liquidated damages provision which imposes an unenforceable penalty. Viewing the unambiguous terms of the loan and guaranty under existing jurisprudence, we hold that the provision merely affixes liability, and is not, in effect, a liquidated damages provision that imposes an unenforceable penalty.

The…