Marine Midland Bank-Southern v. Thurlow , 388 N.Y.S.2d 703 ( 1976 )

Kane, J. (concurring in part and dissenting in part).

We agree with the majority decision except as it relates to the denial of the bank’s motion for summary judgment for interest and to dismiss the counterclaim based on the defense of usury. We concur that Special Term erred in holding that the security pledged under subdivision 3 of section 108 of the Banking Law must consist solely of those items specified therein. However, we are unable to accept the majority view that a question of fact remains whether the note sued upon was for an advance of money. The record demonstrates that the original time note called for a legal rate of interest and that it was paid by the execution and delivery of the demand note upon which this action is founded. Accordingly, we conclude, as a matter of law, that the new obligation did represent an advance of money and complied with all of the other requisites of that statute permitting agreement between the parties on the rate of interest to be charged. The counterclaim should be dismissed and plaintiff awarded interest on whatever amount of principal is hereafter determined to be due and owing.

Main and Larkin, JJ., concur with Herlihy, J.; Greenblott, J. P., and Kane, J., concur in part and dissent in part in an opinion by Kane, J.

Order modified, on the law, by reversing so much thereof as grants plaintiffs motion for summary judgment on the complaint and conditionally denies plaintiffs motion for summary judgment dismissing defendants’ counterclaim; plaintiffs motion for summary judgment on both complaint and counterclaim denied; and, as so modified, order affirmed, with costs to defendants.