Opinion
November 1, 1957
Permut Badillo for defendants.
Caras, Cohen Koch for plaintiff.
Motion by defendants under rule 106 of the Rules of Civil Practice to dismiss the several causes of action set forth in the complaint on the ground that they fail to state facts sufficient to constitute a cause of action. The complaint sets forth three causes of action, the first alleging that defendants as agents or brokers of the plaintiff fraudulently induced plaintiff to enter into a contract with another party; the second cause of action charges defendants with conspiracy to commit a fraud, and the third cause of action is for an accounting by defendants as such agents or brokers.
The motion by defendants to dismiss the complaint for failure to state a cause of action must fail if it in any aspect states a cause of action ( Pomerance v. Pomerance, 301 N.Y. 254; Condon v. Associated Hosp. Service, 287 N.Y. 411, 414). On such a motion the allegations are to be accepted as true ( Matter of Hines v. State Bd. of Parole, 293 N.Y. 254, 258).
The first cause of action alleges that defendants represented themselves as plaintiff's broker and agent, under the contract between plaintiff and a third party, that they would receive the customary brokerage commissions, that the third party was a bona fide purchaser and the sole principal other than plaintiff, that defendants represented to plaintiff that they would fairly represent plaintiff and protect its interests in the transaction, that said representations were false, known by defendants to be false, made with intent to deceive plaintiff, that plaintiff believed them to be true, relied thereon, and was deceived thereby and suffered damage by reason thereof to the extent of the amount set forth in the complaint. The first cause of action contains all of the elements necessary to set forth a cause of action in fraud (see Ochs v. Woods, 221 N.Y. 335; Hanlon v. Macfadden Pubs., 302 N.Y. 502, 509; Sabo v. Delman, 3 N.Y.2d 155, 159).
The second cause of action reiterates the allegations of fraud set forth in the first cause of action and further alleges that the defendants, and a third party with whom plaintiff subsequently entered into a contract, conspired to defraud plaintiff so as to procure a secret profit, and further conspired with said third party so that the latter should not perform the terms and conditions of the contracts between plaintiff and said third party, all to plaintiff's damage. The essence of a conspiracy is a concert or combination to defraud or cause other injury actually resulting in damage ( Borgos v. Price, 140 Misc. 287, 288, citing Place v. Minster, 65 N.Y. 89, 95). The second cause of action sets forth a good cause of action in conspiracy induced by fraud.
The third cause of action is for an accounting by the defendants to the plaintiff for the alleged unjust profits. An "agent must, at the option of his principal, account to him for any profit he might have made in the transaction" ( Dutton v. Willner, 52 N.Y. 312, 319).
Since each of the said causes of action set forth in the complaint states a good cause of action and is properly pleaded, the motion to dismiss is denied. Submit order.