MTB Banking Corp. v. Levy , 621 N.Y.S.2d 351 ( 1995 )

Order, Supreme Court, New York County (Alice Schlesinger, J.), entered on or about April 29, 1994, which denied plaintiffs motion for summary judgment, unanimously affirmed, without costs.

In this consolidated action seeking to recover upon guarantees of payment, the IAS Court properly determined that there are issues of fact as to whether plaintiff assumed fiduciary obligations by managing the defendant company and not maintaining the arm’s length debtor-creditor relationship (see, Fallon v Wall St. Clearing Co., 182 AD2d 245, 250; Chimento Co. v Banco Popular, 208 AD2d 385, 386). Furthermore, the defendants counterclaims also allege fraud and bad faith on the part of the plaintiff (Bank of China v Chan, 937 F2d 780, 789). Finally, the counterclaims are not waived as to the guarantees; the waiver applies specifically to the principal obligation (see, Schneider v OG&C Corp., 684 F Supp 1269, 1273, citing Goodridge v Fernandez, 121 AD2d 942). Concur— Ellerin, J. P., Ross, Williams and Tom, JJ.