| Neckles Bldrs., Inc. v Turner |
| 2014 NY Slip Op 03668 [117 AD3d 923] |
| May 21, 2014 |
| Appellate Division, Second Department |
[*1]
| Neckles Builders, Inc., Respondent, v RobbTurner et al., Appellants. |
Cuddy & Feder LLP, White Plains, N.Y. (Jordan M. Brooks of counsel), forappellants.
Corbally, Gartland and Rappleyea, Pougheepsie, N.Y. (Kristen L. Cinque ofcounsel), for respondent.
In an action, inter alia, to recover damages for breach of contract, the defendantsappeal, as limited by their brief, from (1) so much of an order of the Supreme Court,Dutchess County (Rosa, J.), dated January 25, 2013, as, in effect, denied those branchesof their motion which were to dismiss the first and third causes of action pursuant toCPLR 3211 (a) (1) and (7), and (2) so much of an order of the same court dated April 17,2013, as, in effect, upon reargument, adhered to the determination in the order datedJanuary 25, 2013.
Ordered that the appeal from the order dated January 25, 2013, is dismissed, as thatorder was superseded by the order dated April 17, 2013, made upon reargument; and it isfurther,
Ordered that the order dated April 17, 2013, is affirmed insofar as appealed from;and it is further,
Ordered that one bill of costs is awarded to the plaintiff.
The plaintiff commenced this action against the defendants to recover damages for,inter alia, breach of contract, unjust enrichment, and fraudulent inducement. Thecomplaint alleges that the plaintiff performed certain construction and managerial workon behalf of the defendants and that the plaintiff agreed to forgo its customary fees andcompensation for the work in exchange for an equitable interest in the defendants' maplesyrup venture. The complaint further alleges that the defendant Robb Turner unilaterallyterminated the parties' relationship without paying the plaintiff for its work.
The defendants, among other things, moved pursuant to CPLR 3211 (a) (1) and (7)to dismiss the first cause of action, which alleged breach of contract, and the third causeof action, which alleged fraudulent inducement. In an order dated January 25, 2013, theSupreme Court denied those branches of the defendants' motion. Thereafter, thedefendants moved for leave to reargue. In an order dated April 17, 2013, the SupremeCourt, in effect, upon reargument, adhered to its [*2]original determination.
In considering a motion to dismiss a complaint pursuant to CPLR 3211 (a) (7), thecourt should accept the facts as alleged in the complaint as true, accord plaintiffs thebenefit of every possible favorable inference, and determine only whether the facts asalleged fit within any cognizable legal theory (see Leon v Martinez, 84 NY2d 83,87-88 [1994]; Robertson vWells, 95 AD3d 862 [2012]; Sinensky v Rokowsky, 22 AD3d 563, 564 [2005]). Amotion to dismiss a complaint pursuant to CPLR 3211 (a) (1) will be granted only if thedocumentary evidence submitted by the defendant utterly refutes the factual allegationsof the complaint, conclusively establishing a defense to the claims as a matter of law(see Robertson v Wells, 95 AD3d at 863).
The essential elements for pleading a cause of action to recover damages for breachof contract are the existence of a contract, the plaintiff's performance pursuant to thecontract, the defendant's breach of his or her contractual obligations, and damagesresulting from the breach (seeDee v Rakower, 112 AD3d 204, 208-209 [2013]; Elisa Dreier Reporting Corp. vGlobal NAPs Networks, Inc., 84 AD3d 122, 127 [2011]). According theplaintiff the benefit of every possible favorable inference, the complaint alleged that thedefendants breached the parties' agreement and that, as a result, the plaintiff was entitledto recover its normal fees and compensation for the subject work. Further, the evidencesubmitted by the defendants either was not "documentary" within the meaning of CPLR3211 (a) (1) or failed to conclusively establish a defense to the first cause of action as amatter of law (see Siracusa vSager, 105 AD3d 937, 938 [2013]). The defendants' remaining contentions withrespect to the first cause of action are without merit. Accordingly, the Supreme Courtproperly, in effect, upon reargument, adhered to its prior determination denying thatbranch of the defendants' motion which was pursuant to CPLR 3211 (a) (1) and (7) todismiss the first cause of action.
"The elements of a cause of action sounding in fraud are a material misrepresentationof an existing fact, made with knowledge of the falsity, an intent to induce reliancethereon, justifiable reliance upon the misrepresentation, and damages" (Introna v Huntington LearningCtrs., Inc., 78 AD3d 896, 898 [2010]; see Eurycleia Partners, LP v Seward & Kissel, LLP, 12NY3d 553, 559 [2009]). Where the gravamen of the alleged fraud does not arisefrom the mere failure of a promisor to perform his or her obligations under a contract, butarises from a promisor's successful attempts to induce a promisee to enter into acontractual relationship despite the fact that the promisor harbored an undisclosedintention not to perform under the contract, a proper cause of action sounding in fraudmay be stated. "[A] false statement, promissory in nature, 'may be deemed the statementof a material existing fact, because it falsely represents the [declarant's] state of mind andthe state of his [or her] mind is a fact' " (Tribune Print. Co. v 263 Ninth Ave.Realty, 57 NY2d 1038, 1041 [1982], quoting Deyo v Hudson, 225 NY 602,612 [1919]). "There is no doubt that a misrepresented intention to perform a contract mayconstitute actionable fraud" (Rudman v Cowles Communications, 30 NY2d 1, 9[1972]), and "a statement of present intention is deemed a statement of a materialexisting fact, sufficient to support a fraud action" (Channel Master Corp. vAluminium Ltd. Sales, 4 NY2d 403, 407 [1958]; see Sabo v Delman, 3NY2d 155, 160 [1957] ["if a promise was actually made with a preconceived andundisclosed intention of not performing it, it constitutes a misrepresentation of a 'materialexisting fact' "]; Braddock v Braddock, 60 AD3d 84, 89 [2009]; cf.Affiliated Credit Adjustors v Carlucci & Legum, 139 AD2d 611, 613[1988]).
Here, viewing the complaint in the light most favorable to the plaintiff, the thirdcause of action alleged that the defendants made a promise to give the plaintiff an equitystake in the maple syrup venture if the plaintiff agreed to forego its normal fees andcompensation for the subject work, that the defendants made that promise whileharboring an undisclosed intention never to give the plaintiff such an equity stake, andthat the plaintiff detrimentally relied on the defendants' representation of intent byperforming the subject work for them. These allegations were sufficient to state a causeof action sounding in fraud. Further, the defendants failed to demonstrate theirentitlement to the dismissal of the third cause of action pursuant to CPLR 3211 (a) (1).The defendants' remaining contentions with respect to the third cause of action arewithout merit. Accordingly, the Supreme Court properly, in effect, upon reargument,adhered to its prior determination denying that branch of the defendants' motion whichwas pursuant to CPLR 3211 (a) (1) and (7) to dismiss the third cause of action. Dillon,J.P., Leventhal, Hall and Cohen, JJ., concur.