Banco do Brasil S.A. v. State of Antigua and Barbuda
Appellate Division of New York, First Department
707 N.Y.S.2d 151 (2000)
In November 1981, Banco do Brasil S.A. (Banco) (plaintiff) made a loan to the State of Antigua and Barbuda (State) (defendant). Promissory notes and a guarantee of payment executed by the State’s Ministry of Finance (Ministry) (defendant) were entered into in conjunction with the loan agreement. The State defaulted on the loan, the final payment of which was due January 21, 1985. In a letter to Banco dated October 5, 1989, the Ministry acknowledged its obligation to pay the amount owed and asked for six months to formulate a payment schedule. In a later letter to Banco dated February 24, 1997 and signed by its financial secretary, the Ministry confirmed the existing balances on the loan, including past-due and accrued interest, as well as the total amount owed. When neither the State nor the Ministry paid off the loan in spite of Banco’s demands, Banco sued them for breach of the loan agreement, the promissory notes, and the guarantee. The State and the Ministry moved to dismiss the case on the grounds that the applicable statute of limitations—six years—had run and therefore barred the suit. The trial court denied defendants’ motion, ruling that the Ministry’s 1997 letter had revived the statute of limitations under New York General Obligations Law § 17-101. The State and the Ministry appealed.
Rule of Law
Holding and Reasoning (Lerner, J.)