Saunders

ORDER GRANTING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT PURSUANT TO FEDERAL RULE OF CIVIL PROCEDURE 56(c)

Background

This action arises out of defendant Kenneth Saunders’ (“Saunders”) December 28, 1982 purchase of a limited partnership interest in American National Associates 3 (“ANA-3”), a New York limited partnership. Saunders purchased an interest in ANA-3 following discussions with Marvin Schaffer (“Schaffer”) of Rothschild Reserve International (“Rothschild”), the promoter of ANA-3. The purchase price paid by Saunders for such interest included two series of five promissory notes (the “Notes”) each with a total principal amount of $143,000.00. The Notes, along with promissory notes executed by other investors who purchased limited partnership interests in ANA-3, were to be negotiated and endorsed by a financial institution, such as Morgan Guaranty Trust Company (the “Bank”), in consideration of a payment or loan made to ANA-3 by such institution. As an additional security for the payment or loan, ANA-3 wanted to obtain a bond guaranteeing payment of the promissory notes issued by its limited partners. To that end, in the fall of 1982, plaintiff, National Union Fire Insurance…