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http://nycourts.law.com/CourtDocumentViewer.asp?view=Document&docID=46712 Justice Austin DEFENDANT CORPORATION’S president died in a 2001 airliner crash. His heirs personally guaranteed a 2002 promissory note executed by the corporation’s vice-president. On Jan. 31, 2003, the corporation petitioned for bankruptcy liquidation, which was converted to Chapter 11 reorganization. Its sole assets are accounts receivable from firms located in the Dominican Republic, beyond the court’s jurisdiction. Plaintiff bank moved to sever its action against the corporation on the promissory note so that it could proceed against the guarantors of the corporate debt. The court granted severance. It found that due to the absolute, unconditional language of the heirs’ personal guarantees, the corporation was not an indispensable party to litigation. It also found that a stay of prosecution pending completion of the corporation’s bankruptcy would prejudice plaintiff bank and that to deny severance would effectively grant the heirs a stay of action that they could not obtain through the Bankruptcy Court.

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