The following e-filed documents, listed by NYSCEF document number (Motion 001) 2, 6, 7, 8 were read on this motion for SUMMARY JUDGMENT IN LIEU OF COMPLAINT.

Plaintiff moves under CPLR 3213 for summary judgment in lieu of complaint against defendants Powerhouse Group Enterprises, Inc., and Rosaki Hilt, to collect on a loan. The motion is denied; and the motion-action is dismissed.

With respect to defendant Hilt, the motion-action must be dismissed for lack of personal jurisdiction. A CPLR 3213 motion may not be made returnable before defendant's time to appear under CPLR 320 expires. (See Alpine Capital Bank v Estate of Shiah, 2020 NY Slip Op 50587[U], at *3 [Sup Ct, NY County May 20, 2020].) Plaintiff served defendant Hilt through the leave-and-mail method under CPLR 308 (2). (See NYSCEF No. 8.) In that scenario, defendant must appear "within 30 days after service is complete" (CPLR 320 [a].) Service under CPLR 308 (2) is complete 10 days after the affidavit of service is filed. Plaintiff filed its affidavits of service on November 30, 2021. Defendant Hilt's deadline to appear, therefore, was January 10, 2022.^[FN1] The return date of plaintiff's motion, on the other hand, was January 7, 2022. (See NYSCEF No. 2.) Given plaintiff's failure to provide defendant Hilt with sufficient advance [*2]notice of the motion, as required by CPLR 320 and 3213, this court lacks personal jurisdiction over him. (See Segway of NY, Inc. v. Udit Grp., Inc., 120 AD3d 789, 791-792 [2d Dept 2014]; Estate of Shiah, 2020 NY Slip Op 50587 [U], at *2-*3.)

Even if this court did have personal jurisdiction over Hilt, the motion-action would still have to be dismissed, because plaintiff is seeking here to collect on a usurious loan. For the same reason, although this court does have personal jurisdiction over defendant Powerhouse Group, the motion-action must be dismissed against that defendant as well.^[FN2]

A CPLR 3213 motion-action must be premised on "an instrument for the payment of money only." Plaintiff relies on a "Repayment Agreement" between plaintiff and defendants. (See NYSCEF No. 4.) That instrument recites that it is an agreement under which Powerhouse Group will repay a $50,000 loan that plaintiff made to it in May 2018, on a payment schedule set forth in an attached exhibit. (See id. at 1.) The exhibit reflects that the balance to be repaid by Powerhouse Group under the agreement would comprise (i) the $50,000 principal; (ii) approximately $78,000 in interest that had accrued on the principal between May 2018 and November 2020 at the rate of 3% a month, compounded monthly; and (iii) an additional $27,000 in interest on that $128,000, accruing between January 2021 and December 2021 inclusive at the rate of 3% each month on the then-remaining balance.^[FN3] (See NYSCEF No. 4 at 5.)

In other words, plaintiff's own papers indicate that it is seeking to collect more than $100,000 in interest on a $50,000 loan, accruing at more than 36% annually. Defendants' obligation to pay principal and interest on that loan is thus void and unenforceable in its entirety as criminally usurious.^[FN4] (See Penal Law § 190.40 [providing that imposing an interest rate that exceeds 25% when computed annually is criminally usurious and constitutes a class E felony]; General Obligations Law § 5-521 [3] [providing that corporate borrowers may assert the defense of criminal usury in a civil action]; Adar Bays, LLC v GeneSYS ID, Inc., 37 NY3d 320, 332-333 [2021] [holding that a criminally usurious loan is void and unenforceable]; Seidel v 18 E. 17th St. Owners, Inc., 79 NY2d 735, 740 [1992] [explaining that if a loan exceeds the civil usury interest rate of 16%, the "borrower is relieved of all further payment—not only interest but also [*3]outstanding principal"].)^[FN5]

To be sure, an interest rate on a loan may exceed the statutory usury rates if it applies only upon the borrower's default. (See 72 Ninth LLC v 753 Ninth Ave Realty LLC, 168 AD3d 597, 598 [1st Dept 2019].) But the repayment agreement does not provide—and plaintiff has not contended—that the 3% monthly compound interest rate for the period May 2018 to November 2020 constituted a default rate. Indeed, plaintiff has not identified another interest rate that would have applied between May 2018 and November 2020 absent a default by Powerhouse Group. And the repayment schedule for January to December 2021 provides in advance for the assessment of 3% monthly interest on the remaining balance.^[FN6] (See NYSCEF No. 4 at 5.)

Plaintiff's principal's affidavit states that the "terms of the [Repayment] Agreement were proposed and drafted by Defendants," including the 3% monthly interest rate. (NYSCEF No. 3 at 5.) To the extent that plaintiff is asserting that defendants are thereby estopped from raising usury as a defense against plaintiff's claims, this court disagrees. A borrower is not estopped from raising usury as a defense merely because it drafted a loan agreement with usurious terms. The borrower must also be in a "fiduciary or other like relationship of trust" with the lender, such that the borrower is "under a duty to speak" yet "fails to disclose the illegality" of that rate; and the lender must have "rightfully relie[d] upon the borrower in making the loan." (Abramowitz v Kew Realty Equities, Inc., 180 AD2d 568, 568 [1st Dept 1992]; accord Pemper v Reifer, 264 AD2d 625, 626 [1st Dept 1999]; see also O'Donovan v Galinski, 62 AD3d 769, 770 [2d Dept 2009] [suggesting that a borrower also may be estopped from raising usury as a defense if the borrower "set a rate [it] knew to be usurious for the purpose of avoiding repayment of the loan"].) Plaintiff does not attempt to show that these additional estoppel conditions have been satisfied.

Accordingly, for the foregoing reasons, it is

ORDERED that plaintiff's motion under CPLR 3213 for summary judgment in lieu of complaint is denied; and it is further

ORDERED that the motion-action is dismissed; and it is further

ORDERED that plaintiff serve a copy of this order with notice of its entry on defendants and on the office of the County Clerk, which shall enter judgment accordingly.