Legal Question in Business Law in New York

Promissory Note-

I have a promissory note bewtween my employer and me. There is a Acceleration of Debt clause as shown below; I want to inquire that it is enforceable as it is written.

Acceleration of Debt - In the event that the borrower fails to make any payment due under the terms of this Note, or breach any condition relating to any security, security agreement, note, mortgage or lien granted as collateral security for this Note, seeks relief under the Bankruptcy Code, or suffers an involuntary petition in bankruptcy or receivership not vacated within thirty (30) days, the entire balance of this Note and any interest accrued thereon shall be immediately due and payable to the holder of this Note.


Asked on 1/30/09, 10:20 am

3 Answers from Attorneys
John Friedman Law Office of John K. Friedman

Re: Promissory Note-

It's enforceable but won't be sufficient if bankruptcy is declared, even if the note is paid prior to the declaration of bankruptcy.

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Answered on 1/30/09, 10:25 am
Robert Hundertmark Robert J. Hundertmark, Attorney At Law

Re: Promissory Note-

looks pretty standard, and enforceable as written.

there may be facts, circumstances or a course of dealing outside of the written page which may give rise to a defense against acceleration.

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Answered on 1/30/09, 10:58 am
Michael Markowitz Michael A. Markowitz, PC

Re: Promissory Note-

I agree with Mr. Friedman. It is enforceable. However, it will not be sufficient if bankruptcy is declared. In other words, you cannot avoid the bankruptcy court.

Mike.

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Answered on 1/30/09, 1:17 pm


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