| Niagara Foods, Inc. v Ferguson Elec. Serv. Co., Inc. |
| 2011 NY Slip Op 05751 [86 AD3d 919] |
| July 1, 2011 |
| Appellate Division, Fourth Department |
| Niagara Foods, Inc., et al., Appellants-Respondents, v FergusonElectric Service Company, Inc., et al., Respondents-Appellants. |
—[*1] Rupp, Baase, Pfalzgraf, Cunningham & Coppola LLC, Buffalo (R. Anthony Rupp, III, ofcounsel), for defendant-respondent-appellant Ferguson Electric Service Company, Inc. Walsh, Roberts & Grace, Buffalo (Mark P. Della Posta of counsel), fordefendant-respondent-appellant TEGG Corporation.
Appeal and cross appeals from an amended order of the Supreme Court, Niagara County(Ralph A. Boniello, III, J.), entered July 27, 2010. The amended order, among other things,granted in part defendants' motions to dismiss.
It is hereby ordered that the amended order so appealed from is unanimously modified on thelaw by granting that part of the motion of defendant Ferguson Electric Service Company, Inc. todismiss the breach of contract cause of action asserted against it by plaintiff Benley Realty Co.and as modified the amended order is affirmed without costs.
Memorandum: In this action to recover damages sustained as the result of a fire, plaintiffsappeal and defendants each cross-appeal from an amended order that, inter alia, granted in partdefendants' respective motions to dismiss the first amended complaint. Addressing first plaintiffs'appeal, we conclude that Supreme Court properly granted those parts of the motions to dismissthe causes of action for fraud and negligent misrepresentation.
With respect to that part of the fraud cause of action against defendant TEGG Corporation(TEGG), plaintiffs relied upon an e-mail from TEGG that merely constituted a promise for futureaction, which is insufficient to support that cause of action against TEGG (see Transit Mgt., LLC v Watson Indus.,Inc., 23 AD3d 1152, 1155 [2005]; Cerabono v Price, 7 AD3d 479, 480 [2004], lv dismissed 3NY3d 737 [2004], lv denied 4 NY3d 704 [2005]). With respect to that part of the fraudcause of action against defendant Ferguson Electric Service Company, Inc. (Ferguson), we notethat it is well settled that "[a] cause of action premised upon fraud cannot lie where it is based onthe same allegations as[*2][a] breach of contract [cause ofaction]" (Heffez v L & G Gen. Constr.,Inc., 56 AD3d 526, 527 [2008]). Nevertheless, where the alleged fraudulentrepresentation is collateral to the contract, i.e., it is a fraudulent representation regarding presentfact as opposed to one reflecting an intent to perform, the fraud and breach of contract causes ofaction simultaneously may be maintained (see Deerfield Communications Corp. vChesebrough-Ponds, Inc., 68 NY2d 954, 956 [1986]; McKernin v Fanny Farmer CandyShops, 176 AD2d 233, 234 [1991]). Here, the fraud and breach of contract causes of actionwith respect to Ferguson are based upon the same allegations inasmuch as both rely upon theMay 3, 2004 agreement between Ferguson and plaintiff Niagara Foods, Inc. (Niagara Foods).Moreover, the documents attached to the first amended complaint establish that Ferguson madeno false representation of present fact. With respect to the negligent misrepresentation cause ofaction, no special relationship other than an ordinary business relationship is asserted in the firstamended complaint with respect to either TEGG or Ferguson. Thus, the court properly grantedthose parts of defendants' motions dismissing that cause of action against them (see FleetBank v Pine Knoll Corp., 290 AD2d 792, 795-796 [2002]; H & R Project Assoc. v Cityof Syracuse, 289 AD2d 967, 969 [2001]; Cecos Intl. v Advanced Polymer Sciences,245 AD2d 1017 [1997]).
With respect to defendants' cross appeals, we reject their contention that the court erred indenying those parts of their motions to dismiss the strict products liability cause of action.Plaintiffs properly pleaded a cause of action for strict products liability (see Van Iderstine vLane Pipe Corp., 89 AD2d 459, 460-461 [1982], lv dismissed 58 NY2d 610, 1113[1983]), and the court was correct that, at this stage of the litigation, there is an issue of factwhether defendants provided a service, a product, or a combination thereof. We agree withFerguson, however, that the court erred in denying that part of its motion to dismiss the breach ofcontract cause of action asserted by plaintiff Benley Realty Co. (Benley) against it inasmuch asBenley did not enter into a contract with Ferguson (see Mandarin Trading Ltd. v Wildenstein, 16 NY3d 173, 181-182[2011]). Nor has Benley established that it was a third-party beneficiary of the contract betweenFerguson and Niagara Foods or that any benefit it received from that contract was sufficientlyimmediate to establish the assumption of a duty by Ferguson to compensate Benley in the eventthat the benefit was lost (see id. at 182). We therefore modify the amended orderaccordingly. Present—Scudder, P.J., Smith, Carni, Sconiers and Green, JJ.