Enforcement of Promissory Note Under New York Law – Award of Attorney Fees

Eli Global, LLC, and Greg Lindberg v. Ronald Cieutat, et al., [Ms. SC-2023-0058, Dec. 1, 2023] __So. 3d __ (Ala. 2023). The Court (Mendheim, J.; Parker, C.J., and Shaw, Wise, Bryan, Stewart, Mitchell, and Cook, JJ., concur; Sellers, J., concurs in the result) affirms the Mobile Circuit Court’s summary judgment in favor of Ronald Cieutat, Todd Vereen, and multiple other plaintiffs’ (“Sellers”) claims against Eli Global, LLC on a promissory note and guaranty executed as part of the sale of Hemophilia Preferred Care and its affiliated entities.

The Court first addresses the Defendants’ argument that the Sellers failed to prove who was the holder/possessor of the Promissory Note, as required under the New York UCC to enforce a negotiable instrument. Ms. **25-26. The Court rejects this defense “because the Promissory Note was part of a larger transaction, all of its essential terms were not contained therein, meaning that the Promissory Note was not a negotiable instrument. Because the Promissory Note was not negotiable, the Sellers were not required to prove who possessed the Promissory Note in order to enforce it.” Ms. **38-39. The Court also notes that even if the Promissory Note was negotiable, the Sellers presented enough evidence to establish that Sellers’ representative possessed the Promissory Note at the commencement of the action. Ms. **47-48.

With respect to Eli Global and Lindberg’s challenge to the award of attorney fees and expenses against them, the Court remands for the circuit court to enter an order articulating its reasons for the attorney fee award. The Court explains “the order’s threadbare nature does not ‘allow for meaningful appellate review by articulating the decisions made, the reasons supporting those decisions, and how it calculated the attorney fee.’” Ms. *58, quoting Pharmacia Corp v. McGowan, 915 So. 2d 553 (Ala. 2004).

Related Documents