| River Ridge Living Ctr., LLC v ADL Data Sys., Inc. |
| 2012 NY Slip Op 06066 [98 AD3d 724] |
| August 29, 2012 |
| Appellate Division, Second Department |
| River Ridge Living Center, LLC, Respondent, v ADL DataSystems, Inc., Appellant. |
—[*1] Thorn Gershon Tymann and Bonanni, LLP, Albany, N.Y. (Erin Mead of counsel), forrespondent.
In an action to recover damages for breach of contract, breach of warranty, and fraudulentinducement, the defendant appeals from an order of the Supreme Court, Westchester County(Liebowitz, J.), entered July 1, 2011, which denied its motion for summary judgment dismissingthe cause of action to recover damages for fraudulent inducement, and, in effect, for summaryjudgment limiting the plaintiff's right to recover damages for breach of contract and breach ofwarranty pursuant to the limitation of damages provisions contained in the parties' contract.
Ordered that the order is modified, on the law, by deleting the provision thereof denying thatbranch of the defendant's motion which was, in effect, for summary judgment limiting theplaintiff's right to recover damages for breach of contract and breach of warranty pursuant to thelimitation of damages provisions contained in the parties' contract, and substituting therefor aprovision granting that branch of the motion; as so modified, the order is affirmed, without costsor disbursements.
The plaintiff entered into a contract with the defendant to lease certain computer softwareand related services. The plaintiff commenced this action to recover damages for breach ofcontract, breach of warranty, and fraudulent inducement, alleging, among other things, that thesoftware which the defendant exhibited at a pre-sale demonstration was different from thesoftware delivered, and that the software failed to perform as promised. The defendant moved forsummary judgment dismissing the cause of action to recover damages for fraudulent inducement,and, in effect, for summary judgment limiting the plaintiff's right to recover damages for breachof contract and breach of warranty pursuant to the limitation of damages provisions in thecontract. The Supreme Court denied the defendant's motion, and the defendant appeals. Wemodify.
The essential elements of a cause of action sounding in fraud are a misrepresentation or amaterial omission of fact which was false and known to be false by the defendant, made for thepurpose of inducing the other party to rely upon it, justifiable reliance of the other party on themisrepresentation or material omission, and injury (see Lama Holding Co. v SmithBarney, 88 NY2d 413, 421 [1996]; Channel Master Corp. v Aluminium Ltd. Sales, 4NY2d 403, 406-407 [1958]; DeutscheBank Natl. Trust Co. v Sinclair, 68 AD3d 914, 916 [2009]; Colasacco v Robert E.Lawrence Real Estate, 68 [*2]AD3d 706, 708 [2009]; Orlando v Kukielka, 40 AD3d829, 831 [2007]; Brown v Lockwood, 76 AD2d 721, 730 [1980]). The defendant'scontention that the plaintiff cannot prove that the software exhibited at the demonstration wasdifferent from the software that was ultimately delivered ignores the rule that " 'a party does notcarry its burden in moving for summary judgment by pointing to gaps in its opponent's proof, butmust affirmatively demonstrate the merit of its claim or defense' " (Mennerich v Esposito, 4 AD3d399, 400 [2004], quoting George Larkin Trucking Co. v Lisbon Tire Mart, 185AD2d 614, 615 [1992]; see Fields vVillage of Sag Harbor, 92 AD3d 718, 720 [2012]; Calderone v Town of Cortlandt, 15 AD3d 602, 602-603 [2005]).Accordingly, the defendant failed to establish its prima facie entitlement to judgment as a matterof law dismissing the cause of action to recover damages for fraudulent inducement (cf. Fresh Direct v Blue MartiniSoftware, 7 AD3d 487, 489 [2004]; RKB Enters. v Ernst & Young, 182 AD2d971, 972 [1992]) and, thus, the Supreme Court properly denied that branch of the defendant'smotion which was for summary judgment dismissing that cause of action (see Alvarez vProspect Hosp., 68 NY2d 320, 324 [1986]; Zuckerman v City of New York, 49NY2d 557 [1980]).
However, the Supreme Court should have granted that branch of the defendant's motionwhich was, in effect, for summary judgment limiting the plaintiff's right to recover damages forbreach of contract and breach of warranty. The defendant established, prima facie, that it isentitled to enforce two provisions in the parties' contract limiting the plaintiff's right to recoverdamages for breach of contract and breach of warranty (see Metropolitan Life Ins. Co. vNoble Lowndes Intl., 84 NY2d 430, 436 [1994]). In opposition, the plaintiff failed to raise atriable issue of fact (see generally Zuckerman v City of New York, 49 NY2d at 562).Rivera, J.P., Balkin, Belen and Chambers, JJ., concur.