In the eyes of these authors, CPLR 3213 is perhaps the most unheralded procedural device in New York state court practice. CPLR 3213 allows litigants to quickly and efficiently enforce instruments for the payment of money only or a previously rendered judgment. Under CPLR 3213, a party seeking to enforce such an instrument or a judgment can initiate an action by immediately filing a summary judgment motion, with succinct supporting papers, instead of being forced to file a complaint and await the outcome of discovery before moving for summary judgment. This is a major benefit to lenders and other parties who are in the midst of simple, straightforward disputes involving judgments or instruments for the payment of money only because it provides a streamlined mechanism by which they can obtain a New York judgment for the money to which they are entitled, right at the outset of a case.

Procedure Under CPLR 3213

CPLR 3213 states: “When an action is based upon an instrument for the payment of money only or upon any judgment, the plaintiff may serve with the summons a notice of motion for summary judgment and the supporting papers in lieu of a complaint. The summons served with such motion papers shall require the defendant to submit answering papers on the motion within the time provided in the notice of motion.”

Accordingly, CPLR 3213 lets a plaintiff sidestep the procedural requirements of a typical action and instead file summary judgment papers right from the get-go.[1] Per commentators, this sped-up procedure is a tacit admission that “some claims have greater presumptive merit than others and should have easier access to the courts than an ordinary plenary action gets.” David D. Siegel, New York Practice 5th Ed. §288. Thus, CPLR 3213 “was enacted to provide quick relief on documentary claims so presumptively meritorious that a formal complaint is superfluous, and even the delay incident upon waiting for an answer and then moving for summary judgment is needless.” Cooperatieve Centrale Raiffeisen-Boerenleenbank, B.A. v. Navarro, 25 N.Y.3d 485, 492 (2015) (internal citations and quotations omitted).

Although CPLR 3213 can be used for both judgments and “instruments for the payment of money only,” it is more often used for the latter category. Siegel, §290. Litigants with previously rendered judgments from other states or federal courts can instead utilize the registration device available under Article 54 of the CPLR, provided that the judgment was not “obtained by default in appearance, or by confession of judgment.” CPLR 5401. This is even quicker than the procedure available under CPLR 3213. Accordingly, to the extent CPLR 3213 is used for judgments, it is typically used by litigants seeking to convert a foreign judgment to a judgment enforceable in New York. Siegel, §290.

For litigants with instruments that are purportedly for the payment of money only, they may establish a prima facie entitlement to summary judgment in lieu of complaint under CPLR 3213 by producing an “instrument [that] contains an unconditional promise to pay a sum certain over a stated period of time,” along with proof of a failure to pay. Bloom v. Lugli, 81 A.D.3d 579, 580 (1st Dep’t 2011). This prima facie case is typically met by submitting the “instrument for the payment of money only” at issue, along with an affidavit attesting to the fact that the defendant has defaulted on the “instrument” and the amount owed. If, however, “outside proof is needed, other than simple proof of nonpayment or a similar de minimis deviation from the face of the document,” the document does not qualify for CPLR 3213 relief. Weissman v. Sinorm Deli, 88 N.Y.2d 437, 444 (1996). Once a prima facie case is met, the burden shifts to the defendant to establish that there is a triable issue of fact precluding the grant of summary judgment. Zyskind v. FaceCake Marketing Technologies, 101 A.D.3d 550, 551 (1st Dep’t 2012). If the defendant cannot do so, judgment is granted right then and there, without further delay or cost for the plaintiff seeking enforcement. If the motion is denied, courts can treat the motion as a complaint and require the defendant to submit an answer instead. Kolanu Partners v. Wu, 19837-2013, 42 Misc.3d 1224(A), at *3 (N.Y. Civ. Ct. 2014).

One thing to keep in mind for practitioners in examining the usefulness of CPLR 3213 is that, because New York is often the site of cross-border transactions—and accordingly, cross-border disputes—diversity jurisdiction may be available in cases where CPLR 3213 is an attractive option. It is therefore possible for a defendant to remove an action initiated by way of a CPLR 3213 motion to federal court before serving answering papers. In that event, New York federal courts can decide whether to consider the CPLR 3213 motion as a summary judgment motion (as it is in New York state court) or, instead, treat the CPLR 3213 motion as a complaint (because there is no CPLR 3213 equivalent under the Federal Rules of Civil Procedure). Compare Sun Forest v. Shvili, 152 F. Supp. 2d 367, 387 (S.D.N.Y. 2001) (“It is well established that the district court ‘takes the [removed] action in the posture in which it existed when it is removed from a state’s court jurisdiction and must give effect to all actions and procedures accomplished in a state court prior to removal.’ Accordingly, because [the plaintiff] is not required to file a complaint before obtaining expedited consideration of its summary judgment motion, the Court will evaluate the merits of [the plaintiff’s] motion as if it had been originally filed in this District.”), with Inner City Telecommunc’ns Network v. Sheridan Broad, No. 10 Civ. 3567, 2010 WL 2835559, at *2 (S.D.N.Y. July 13, 2010) (“The Court … has deemed the moving and opposition papers [submitted in state court pursuant to CPLR §3213] to be the Complaint and Answer.”).

The Broadening Scope of CPLR 3213

CPLR 3213 is attractive to many litigants who seek to use its speedy procedures for disputes that involve instruments for the payment of money only. As a result, there are many cases that delineate what precisely constitutes such an instrument. To be sure, Siegel cautions that parties “should not use CPLR 3213 without a paper that unequivocally qualifies” because they may get caught in a dispute about “whether CPLR 3213 has been properly invoked.” Siegel, §289.

But this advice may be somewhat outdated in light of recent case law, as courts have begun to expand the scope of what constitutes an “instrument for the payment of money only” beyond the obvious categories such as unconditional promissory notes or guaranties. For example, in Phoenix Experiential Designs v. Lerner, one New York County Supreme Court Justice relied upon a series of First and Second Department cases to hold that a settlement and release agreement resolving a litigation fit within the confines of CPLR 3213, because it contained an “unconditional promise” of payment without any conditions precedent or consideration required. No. 159723/15, 51 Misc.3d 1207(A), at *2 (Sup. Ct. N.Y. Cty. March 31, 2016). Similarly, in Nordea Bank Finland PLC v. Holten, the First Department affirmed the Supreme Court’s grant of summary judgment under CPLR 3213 based upon a put agreement because it contained “an independent, absolute and unconditional obligation to pay money only,” and the plaintiff had provided evidence of nonpayment. 84 A.D.3d 589, 590 (1st Dep’t 2011). And in Allied Irish Banks, PLC v. Young Men’s Christian Ass’n of Greenwich, a different New York County Supreme Court Justice found that an interest rate swap agreement was eligible under CPLR 3213 despite the fact that it did not cite on its face a sum certain because the amount due could be determined from “publicly available and easy to ascertain information.” 36 Misc.3d 216, 220 (Sup. Ct. N.Y. Cty. April 12, 2012). Similarly, the court dismissed the defendant’s reliance on provisions that supposedly required it to meet various conditions because those provisions did not constitute conditions precedent to payment or require any performance by the defendant; instead, they merely described the conditions under which the defendant would be liable for actual damages. Id. at 221.

These cases and others suggest that CPLR 3213 is far more powerful than most practitioners tend to believe. And if courts continue to broaden the scope of what constitutes an “instrument for the payment of money only” in the future, CPLR 3213’s door will be opened to even more litigants, allowing them to resolve more and more of their disputes in a quick and cost-effective manner. Even without further expansion, however, CPLR 3213 is a valuable procedural remedy that practitioners would do well to keep in mind.

Endnotes:

[1] Though parties can typically set return dates as early as eight days after providing notice on a conventional motion, CPLR 3213 provides that parties must proceed under CPLR 320(a)’s timelines for initiating and responding to an action and thus provide either 20 or 30 days of service, depending on the manner of service. Still, CPLR 3213 gives the plaintiff the added advantage of being able to set a specific return date as with any other motion, rather than waiting for the defendant to answer or otherwise respond to a complaint. Plaintiffs can add up to 10 days to the minimum service time to require the defendant to serve answering papers in advance of the return date.

Brian D. Koosed is a partner at K&L Gates in the Washington, D.C. and New York offices. Priya Chadha is an associate in the firm’s New York office.