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COMPUTER HARDWARE & SERVICES
mirra.com

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Founded Year

2002

Stage

Acquired | Acquired

Total Raised

$11.2M

About Mirra

Mirra provides services which include free agent desk, free agent go, free agent xtreme

Mirra Headquarter Location

150 Mathilda Place Suite 450

Sunnyvale, California, 94086,

United States

408-215-5700

Latest Mirra News

General Statement of Indebtedness is Sufficient to Restart Statute of Limitations Despite Ambiguities

Mar 27, 2021

To embed, copy and paste the code into your website or blog: <iframe frameborder="1" height="620" scrolling="auto" src="//www.jdsupra.com/post/contentViewerEmbed.aspx?fid=7fd380d3-cc8f-406e-8817-858804cdc419" style="border: 2px solid #ccc; overflow-x:hidden !important; overflow:hidden;" width="100%"></iframe> The statute of limitations to recover on a breach of contract is six years. Parties can extend that limitations periods by agreement, and New York General Obligations Law 17-101 governs the form of such agreements. It provides that, “[a]n acknowledgment or promise contained in a writing signed by the party to be charged thereby is the only competent evidence of a new or continuing contract whereby to take an action out of the operation of the provisions of limitations of time for commencing actions under the civil practice law and rules. . . ”  Per GOL 17-101, only signed writings acknowledging the indebtedness and promising to pay are sufficient to extend the statute of limitations. In considering whether a writing satisfies GOL 17-101 and extends a statute of limitations, Courts require three elements: Signature, Content, and Delivery. First, the acknowledgement must be “signed by the party to be charged thereby.”  See 20 Plaza Hous. Corp. v. 20 Plaza E. Realty , 950 N.Y.S.2d 871, 874 (Sup. Ct. N.Y. Cty. Aug. 30, 2012) (Section 17-101 inapplicable because acknowledgment was “not signed by defendant”). Second, the acknowledgment must convey “an intention to pay Plaintiff’s debt.”  See Knoll v. Datek Sec. Corp. , 2 A.D.3d 594, 595 (2d Dep’t 2003) (“[T]he critical determination is whether the acknowledgment imports an intention to pay.”). If the writing is at all inconsistent with an unequivocal intention to repay the debt, the writing fails the requirements of GOL 17-101. Third, the acknowledgment “must have been communicated to the plaintiff or someone acting on his behalf, or intended to influence the plaintiff’s conduct.”  See Lynford v. Williams , 34 A.D.3d 761, 763 (2d Dep’t 2006) (Section 17-101 inapplicable where “plaintiff did not learn of the [purported acknowledgments] until after he commenced this action”). In part because GOL 17-101 was intended to limit the instances in which an acknowledgment revives a cause of action, Courts strictly enforce each of the three requirements. A writing failing any of the Signature, Content, or Delivery requirements is insufficient to restart the statute of limitations. While the requirements of GOL 17-101 are strictly enforced, not every ambiguity in the acknowledgment will defeat its enforcement. Recently, in  Hawk Mtn. LLC v. RAM Capital Group LLC , 2021 NY Slip Op. 01349, the First Department held that an acknowledgement was sufficient to satisfy GOL 17-101 and restart the statute of limitations, despite its failure to specifically refer to the debt and inconsistencies between the acknowledgment and the underling note. Background The dispute in Hawk Mountain stems from a decades-long series of complex transactions and bitter disputes between Raymond Mirra and his ex-wife, disgraced pharmaceutical executive Gigi Jordan. In order to protect more than $29 million in proceeds arising from their company’s merger with AmerisourceBergen, Jordan and Mirra created a tangled series of trusts and LLCs, including the Plaintiff here, Hawk Mountain LLC. In 2005 and at Mirra’s request, Hawk Mountain executed a promissory note with RAM Capital, an entity controlled by Mirra. The 2005 promissory note (the “2005 Note”) provided for an initial $100,000 draw, and a line of credit for an additional $6 million. By 2007, RAM Capital had borrowed more than $7 million from Hawk Mountain. In 2008, Jordan and Mirra entered into a separation agreement (the “SDA”). The SDA set forth various then-existing liabilities between the various entities controlled by Jordan and Mirra, including a scheduling showing that RAM Capital Group owed Hawk Mountain LLC $7,078,772 plus $1,043,252 in then-accrued interest. The SDA did not explicitly reference the 2005 Note, and the figures in the SDA differed from those owed under the 2005 Note. The parties expressly agreed in the SDA that RAM Capital would make “full payment and satisfaction all of the outstanding indebtedness plus accrued interest which RAM Capital Group, LLC owes to Hawk Mountain LLC . . . [no] later than the Closing Date (March 31, 2008).” In 2013, Plaintiff commenced a civil RICO suit against RAM Capital and others in the United States District Court for the District of Delaware. In January 2014, Hawk Mountain amended its federal complaint to include a cause of action for breach of the 2005 Note. When the RICO action was dismissed, the federal court declined to exercise jurisdiction over the claim for breach of the 2015 Note, and Plaintiff commenced its state court action. The Lower Court On January 10, 2020, the Supreme Court, NY County granted Defendant’ motion to dismiss. Assuming that the SDA satisfied the requirements of GOL 17-101, the Supreme Court held that the last possible date to bring this action was March 12, 2014. And although the action was commenced (originally in the Delaware RICO case) in January 2014, the Court found it untimely. Plaintiff timely appealed. The First Department’s Decision On appeal, Plaintiff argued that the Court simply misread the calendar in concluding that a January 2014 commencement date would time bar an action if the statute of limitations expired on March 12, 2014. Plaintiff further argued that the SDA satisfied the requirements of GOL 17-101. The SDA was signed by Mirra, RAM’s manager, it contained a schedule of assets and liabilities stating that RAM owed Hawk Mountain $7,078,772, and it stated that RAM would make “full payment of all the outstanding indebtedness plus accrued interest . . . [no] later than the Closing Date (March 31, 2008),” and the SDA was delivered to Plaintiff. While the amounts were different, nothing in the SDA, Plaintiff argued, was inconsistent with an unequivocal promise to pay. And although the SDA did not specifically reference the 2005 Note, its reference to all outstanding indebtedness was sufficient. Defendant argued that the SDA failed to satisfy the strict signature and content requirements of GOL § 17-101. First, because Mirra signed the SDA in his personal capacity and not as a manager of RAM, the SDA was not “signed by the party to be charged thereby.”  Second, Defendant argued that the SDA did not satisfy the content requirements of 17-101 because the promise to pay “all the outstanding indebtedness” did not specifically refer to the 2005 Note. Defendant relied upon Zinn v. Stamm, a First Department case from 1912, which held that where there are several separate loans between the parties, an instrument extending the statute of limitations under 17-101 must indicate with specificity the loan to which it is referring; a general acknowledgment of indebtedness is insufficient. Echoing the trial court, Defendant further argued that the SDA could not satisfy the requirements of GOL 17-101 because it is ambiguous. The amount due on the loan is different than the amount set forth in the SDA. Containing different numbers, Defendant argued, the SDA cannot be said to “leave no room for doubt” that it was referring to the 2005 Note. The First Department sided with Plaintiff. The Court rejected Defendant’s assertion that Mirra only signed the SDA in his personal capacity, holding that the SDA was signed by Defendant’s agent. As to the ambiguity arising from the differences in amounts, the Court held, [E]ven though the amount listed in the scheduled note annexed to the SDA differs from that asserted in the complaint, there is no requirement that an acknowledgement of a debt pursuant to General Obligations Law § 17-101 leave no room for doubt as to the nature and quantum of the debt to be acknowledged. Instead, an acknowledgement of a debt need only recognize an existing debt and contain nothing inconsistent with an intention on the part of the debtor to pay it. Practical Considerations Agreements to extend the statutes of limitations are common fixtures in commercial litigation, and courts applying GOL 17-101 must take care to avoid frustrating the parties true intent via a too-rigid application of the requirements. As Hawk Mountain demonstrates, not every ambiguity in a written acknowledgement of debt will be grounds to invalidate the extension. So long as the acknowledgement of the debt contains nothing inconsistent with an intention to pay it, GOL 17-101 will be satisfied.

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