Opinion
SC-0746-19/GF
04-17-2020
Gina BIANCHI and Steve Bobarakis, Plaintiffs v. Jerri WOODARD, Susan Waehner, and Brook Hill Development, Inc., Defendants
Gina Bianchi and Steve Bobarakis, pro se Nolan, Heller Kauffman, LLP., John V. Hartzell, Esq., of counsel, attorneys for the Defendants
Gina Bianchi and Steve Bobarakis, pro se
Nolan, Heller Kauffman, LLP., John V. Hartzell, Esq., of counsel, attorneys for the Defendants
Gary C. Hobbs, J.
PROCEDURAL BACKGROUND
On or about December 5, 2019, the Plaintiffs commenced the present small claims action against the Defendants seeking judgment in the amount of $4,800.00 for the "repair of nail pops throughout the house in family room, dining room, master bedroom, 1st floor bath, basement bath, laundry and mudrooms and hallway to basement (eight rooms), as well as repainting those rooms."
On January 27, 2020, Defendants, Jerri Woodard and Susan Waehner, moved to dismiss the action as against them individually pursuant to CPLR 3211(a)(1),(2) and (7). In deciding this motion, this Court has received the following:
1. Affidavits of Defendants, Jerri Woodard and Susan Waehner, both sworn to on January 21, 2020, in support of the motion, together with the annexed exhibits.
2. Responsive Affidavit of Plaintiff, Gina Bianchi, sworn to on January 31, 2020, in opposition to the motion, together with the annexed exhibits.
3. Reply Affirmation of John V. Hartzell, Esq., counsel for the Defendants, undated (received on February 5, 2020).
4. Surreply Affidavit of Gina Bianchi, sworn to on February 7, 2020, with attached exhibits.
5. Letter dated February 18, 2020, from John V. Hartzell, Esq., objecting to the surreply papers.
DEFENDANT'S OBJECTION TO THE PLAINTIFFS' SURREPLY PAPERS
Defense counsel has objected to the Plaintiffs' surreply papers on the grounds that "surreply papers are not allowed in New York Practice without leave of court, and we object to the consideration of the February 7, 2020 surreply affidavit of Ms. Bianchi." [Feb. 18, 2020 Letter of Attorney Hartzell].
Defense counsel correctly notes that surreply papers are not explicitly permitted by the statute that addresses motion papers. The CPLR provides for a notice of motion and supporting affidavits, answering affidavits and supporting papers, and any reply or responding affidavits. BAC Home Loans Servicing, LP v. Uvino , 155 AD3d 1155, 1156-57 (3d Dept. 2017), citing , CPLR 2214[b]. The courts can refuse to consider a surreply affidavit where the movant has failed to obtain the Court's permission to file such papers. See; Matter of Kushaqua Estates Inc. v. Bonded Concrete Inc. , 215 AD2d 993, 994 (3d Dept. 1995) (Supreme Court could properly refuse to consider respondents' surreply which not only was submitted without permission from the court, but was not restricted to the issues raised in petitioner's reply affidavit and contained new factual information relating to respondents' failure to timely commence a foreclosure action); September Food Sys. LLC v. BRE/Wellesley Properties, L.L.C. , 25 Misc. 3d 1202(A) (Sup. Ct. 2007), aff'd sub nom., Sept.'s Food Sys., LLC v. BRE/Wellesley Properties, LLC , 52 AD3d 680 (2d Dept. 2008) (plaintiff's papers constituted an unauthorized sur-reply and sur-sur-reply and, as a result, the arguments put forth in them were not considered).
However, since the court has the authority to regulate the motion practice before it, the judge has wide discretion to determine whether to accept surreply papers or papers otherwise not in conformance with controlling statutes or rules. See ; U.S. Bank Trust, N.A. v. Rudick , 156 AD3d 841, 842, 67 N.Y.S.3d 646 (2d Dept. 2017) (holding that "[w]hile unauthorized surreplies containing new arguments generally should not be considered, the Supreme Court has the authority to regulate the motion practice before it, as well as the discretion to determine whether to accept late papers or even surreply papers for ‘good cause.’); Held v. Kaufman, 238 AD2d 546,548 (2d Dept. 1997), aff'd as modified , 91 NY2d 425 (1998) ; Liotti v. Peace , 36 Misc. 3d 1218(A) (Sup. Ct., Nassau County, 2003). This rule is especially applicable where, as here , the movant introduced new facts or posed a new legal argument in the reply papers. See; Beazer v. New York City Health and Hosps. Corp. , 76 AD3d 405, 407 (1st Dept. 2010), aff'd , 18 NY3d 833 (2011) (The court properly permitted plaintiff to submit a surreply in response to the defendant's reply papers, which advanced a certain argument for the first time through a supplemental affidavit by its expert); Park Country Club of Buffalo, Inc. v. Tower Ins. Co. of New York , 68 AD3d 1772, 1774 (4th Dept. 2009) ; Gluck v. New York City Tr. Auth. , 118 AD3d 667, 668 (2d Dept. 2014) ; Basile v. Grand Union Co. , 196 AD2d 836, 837 (2d Dept. 1993).
In the present case, the reply affirmation of attorney Hartzell included new factual representations, which were not included in the defendants' original motion papers, including an alleged conversations with plaintiff Steve Bobarakis concerning the reason why the individual defendants were named in the action [Hartzell Reply Affirmation, ¶4], and an argument that, since the plaintiffs are attorneys, they could not be deceived into believing that the individual defendants were promising to personally guaranty the repairs to the plaintiffs' home [Hartzell Reply Affirmation, ¶5]. As a result, this Court hereby accepts and will consider the plaintiffs' surreply papers.
MOTION TO DISMISS FOR LACK OF JURISDICTION
Pursuant to section 1801 of the Uniform City Court Act, this Court has jurisdiction where the defendant either resides, has an office for the transaction of business, or has regular employment in the county where the court is located. UCCA § 1801 ; Valentino v. Principio , 174 Misc 2d 709, 710 (City Ct., City of Geneva, 1997).
Here, Defendant Waehner asserts that she resides in the State of California, and she does not have a residence or an office for the regular transaction of business or a regular place of employment in New York State. [Waehner Affidavit ¶8 and Hartzell Reply Affirmation ¶ 7]. However, Defendant Waehner's assertion is contradicted by her January 23, 2018 email letter to the Plaintiffs [Bianchi Responsive Affidavit, Exhibit V]. In this email, Ms. Waehner directed the Plaintiffs to contact her by mail at her Brook Hill Development office in Bolton Landing, New York, which is located in Warren County, where this Court is located. Thus, Ms. Waehner's email demonstrates that she has an office for the regular transaction of business or a regular place of employment in Warren County, New York. Furthermore, Ms. Waehner also owns a seasonal residence located at 4 Rose Lane, Bolton Landing, Warren County, New York [Bianchi Surreply Affidavit, ¶19, Attachment B].
Based on the foregoing, Defendant Waehner's motion to dismiss for lack of jurisdiction is denied.
MOTION TO DISMISS FOR FAILURE TO STATE A CAUSE OF ACTION AND BASED ON DOCUMENTARY EVIDENCE
The individual defendants, Jerri Woodard and Susan Waehner, seek dismissal of the Plaintiffs' small claims complaint pursuant to CPLR 3211(a)(1) [based on documentary evidence] and 3211(a)(7) [based on an alleged failure of the small claims complaint to state of cause of action]. The individual defendants' motion to dismiss alleges similar grounds under both CPLR 3211(a)(1) and 3211(a)(7).
More specifically, the Plaintiffs' complaint seeks damages in the amount of $4,800.00 for the "repair of nail pops throughout the house in family room, dining room, master bedroom, 1st floor bath, basement bath, laundry and mudrooms and hallway to basement (eight rooms), as well as repainting those rooms" in the Plaintiffs' newly constructed townhouse located at Unit 202, Langoon Manor, Bolton Landing, New York [Plaintiffs' complaint]. The individual defendants assert that 1) the Plaintiffs' complaint is a breach of contract claim, 2) that the contract for the construction and sale of the Plaintiffs' townhouse was between Defendant Brook Hill Development, Inc., and the Plaintiffs, 3) that defendants Woodard and Waehner are merely officers of defendant Brook Hill, and they always acted in their legal capacity as officers of defendant Brook Hill, and 4) that any legal claims concerning problems with the construction the Plaintiffs' townhouse can only be asserted against defendant Brook Hill [Woodard Affidavit ¶s 3-7; Waehner Affidavit ¶s 3-7]. Finally, the individual defendants assert that plaintiffs' claims of fraudulent misrepresentation relate solely to the contractual dispute and, as a matter of law, must be dismissed as duplicative [Hartzell Reply Affirmation ¶s 2,3,6].
In response, the plaintiffs assert that the individual defendants made fraudulent misrepresentations in that they "consistently asserted in numerous emails that the nail pops at issue would be repaired if we waited many months until other work was completed in the home." [Bianchi 1-31-20 Affidavit ¶4]. Here, the plaintiffs assert that "Woodard indicated in numerous emails that the nail pops would be fixed when other required Sheetrock work was to be done in May 2018 and Susan Waehner specifically stated in a February 15, 2018 email to us that "Nail pops are Sheetrock related and will be fixed when the master closet is repaired in May." [Bianchi 1-31-20 Affidavit ¶11]. The plaintiffs further assert that defendant Woodard's emails are not signed as a representative of defendant Brook Hill, but are signed, "Jerri." [Bianchi 1-31-20 Affidavit ¶10]. Defendant Waehner's emails come from her personal Comcast email account, and not from a business account [Bianchi 1-31-20 Affidavit ¶10].
CPLR 3211(a)(1) permits the court to dismiss an action based upon documentary evidence. To warrant dismissal on this ground, the court must find that the documentary evidence totally refutes plaintiff's claim and conclusively establishes a defense as a matter of law. Goshen v. Mutual Life Ins. Co. of New York, 98 NY2d 314 (2002) ; Leon v. Martinez, 84 NY2d 83 (1994) ; 730 J & J LLC v. Fillmore Agency, Inc., 303 AD2d 486 (2nd Dept. 2003) ; Berger v. Temple Beth-El of Great Neck , 303 AD2d 346 (2nd Dept. 2003). Under the appropriate circumstances, a contract is documentary evidence sufficient to support dismissal pursuant to CPLR 3211(a)(1). See; 150 Broadway NY Assocs., L.P. v. Bodner, 14 AD3d 1 (1st Dept. 2004) ; Greenwood v. Daily News, L.P. , 8 Misc. 3d 1002(A) (Sup. Ct., Nassau County, 2005).
Thus, a "motion pursuant to CPLR 3211(a)(1) to dismiss the complaint on the ground that the action is barred by documentary evidence may be granted only where the documentary evidence utterly refutes the plaintiff's factual allegations, thereby conclusively establishing a defense as a matter of law." Behar v. Glickenhaus Westchester Dev., Inc. , 122 AD3d 784, 785 (2d Dept. 2014), quoting , Mendelovitz v. Cohen, 37 AD3d 670, 830 N.Y.S.2d 577 (2d Dept. 2007), citing , Goshen v. Mutual Life Ins. Co. of NY, 98 NY2d 314, 326, 746 N.Y.S.2d 858, 774 N.E.2d 1190 (2002). In addition, the evidence submitted in support of a CPLR 3211(a)(1) motion must qualify as ‘documentary evidence,’ in that it must be unambiguous, authentic, and undeniable. Documents such as judicial records, as well as documents reflecting out-of-court transactions such as mortgages, deeds, and contracts, the contents of which are essentially undeniable, generally qualify as ‘documentary evidence’ in the proper case. However, affidavits, deposition testimony, and letters are not considered documentary evidence within the intendment of CPLR 3211(a)(1). Soroush v. Citimortgage, Inc. , 161 AD3d 1124, 1126 (2d Dept. 2018), quoting, Eisner v. Cusumano Constr., Inc. , 132 AD3d 940, 941–942, 18 N.Y.S.3d 683 (internal quotation marks and citations omitted).
In addition, CPLR 3211(a)(7) permits the court to dismiss a complaint that fails to state a cause of action. It is well settled that, when deciding such a motion, the court must determine whether the plaintiff has a legally cognizable cause of action; not whether the cause of action has been properly plead. See; Guggenheimer v. Ginzburg, 43 NY2d 268 (1977) ; Rovello v. Orofino Realty Co., 40 NY2d 633 (1976) ; Well v. Yeshiva Rambam, 300 AD2d 580 (2nd Dept. 2002) ; Frank v. DaimlerChrysler Corp., 292 AD2d 118 (1st Dept. 2002). Thus, when a party moves to dismiss a complaint pursuant to CPLR 3211(a)(7), the standard is whether the pleading states a cause of action, not whether the proponent of the pleading has a cause of action. See; Thomson v. New World Bible Translation Comm. , 127 AD3d 731, 732 (2d Dept. 2015), citing, Guggenheimer v. Ginzburg, 43 NY2d 268, 275, 401 N.Y.S.2d 182, 372 N.E.2d 17 (1977) ; Sokol v. Leader, 74 AD3d 1180, 1181, 904 N.Y.S.2d 153 (2d Dept. 2010). In considering such a motion, the court must accept the facts as alleged in the complaint as true, accord the plaintiff the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory. Thomson v. New World Bible Translation Comm. , 127 AD3d 731, 732 (2d Dept. 2015), citing , Nonnon v. City of New York, 9 NY3d 825, 825, 842 N.Y.S.2d 756, 874 N.E.2d 720 (2007) ; Leon v. Martinez, 84 NY2d 83, 87–88, 614 N.Y.S.2d 972, 638 N.E.2d 511 (1994).
The elements of a fraud cause of action consist of "a misrepresentation or a material omission of fact which was false and known to be false by [the] defendant, made for the purpose of inducing the other party to rely upon it, justifiable reliance of the other party on the misrepresentation or material omission, and injury." Pasternack v. Lab. Corp. of Am. Holdings , 27 NY3d 817, 827 (2016), citing, Mandarin Trading Ltd. v. Wildenstein, 16 NY3d 173, 178, 919 N.Y.S.2d 465, 944 N.E.2d 1104 (2011), quoting, Lama Holding Co. v. Smith Barney, 88 NY2d 413, 421, 646 N.Y.S.2d 76, 668 N.E.2d 1370 (1996) ; Eurycleia Partners, LP v. Seward & Kissel, LLP, 12 NY3d 553, 559, 883 N.Y.S.2d 147, 910 N.E.2d 976 (2009).
It is well settled that a cause of action seeking damages for fraud cannot be sustained when the alleged fraud only relates to a breach of contract. Ensky v. KM Ins. Brokers , 139 AD2d 691 (2d Dept. 1988), citing, Edwil Industries v. Stroba , 131 AD2d 425, 516 N.Y.S.2d 233 (2d Dept. 1987) ; Gould v. Community Health Plan of Suffolk, Inc. , 99 AD2d 479, 480 (2d Dept. 1984), quoting , Miller v. Volk & Huxley, 44 AD2d 810, 355 N.Y.S.2d 605 (1st Dept. 1974) ; Chase v. United Hosp., 60 AD2d 558, 400 N.Y.S.2d 343 (1st Dept. 1977) ; Kaufman v. Torkan , 51 AD3d 977, 980 [2d Dept. 2008]. Furthermore, failure to fulfil promises to perform acts in the future is a breach of contract, and not fraud. Fletcher v. Greiner, 73 AD2d 591, 422 N.Y.S.2d 130 (2d Dept. 1979) ; Wegman v. Dairylea Coop., 50 AD2d 108, 376 N.Y.S.2d 728, app. dism. , 38 NY2d 710, 382 N.Y.S.2d 1030, 346 N.E.2d 829 (4th Dept. 1975) ; Tesoro Petroleum Corp. v. Holborn Oil Co. Ltd. , 108 AD2d 607, 607 (1st Dept. 1985) ; Wegman v. Dairylea Coop., 50 AD2d 108, 113, 376 N.Y.S.2d 728, lv. dism., 38 NY2d 918, 382 N.Y.S.2d 979, 346 N.E.2d 817 (4th Dept. 1975) ; Miller v. Volk & Huxley, 44 AD2d 810, 355 N.Y.S.2d 605 (1st Dept. 1974). "In order to recover damages for fraud, the fraud alleged cannot relate to a breach of contract" and the plaintiff must allege a legal duty independent of the contract itself. Marcantonio v. Picozzi , 70 AD3d 655, 656 (2d Dept. 2010), quoting, Kaufman v. Torkan, 51 AD3d 977, 980, 859 N.Y.S.2d 253, citing , Heffez v. L & G Gen. Constr., Inc., 56 AD3d 526, 867 N.Y.S.2d 198 ; Ka Foon Lo v. Curis, 29 AD3d 525, 526, 815 N.Y.S.2d 131 ; Sforza v. Health Ins. Plan of Greater NY, 210 AD2d 214, 619 N.Y.S.2d 734.
Moreover, when a fraud claim seeks recovery for the very same losses at issue in the breach of contract claim, the fraud claim is duplicative. Cronos Group Ltd. v. XComIP, LLC , 156 AD3d 54, 64-65 (1st Dept. 2017). See also; Mosaic Caribe, Ltd. v. AllSettled Group, Inc., 117 AD3d 421, 422–423, 985 N.Y.S.2d 33 (1st Dept. 2014) [dismissing a fraud claim as duplicative because it sought "the same (compensatory) damages as the breach of contract claim."]; Havell Capital Enhanced Mun. Income Fund, L.P. v. Citibank, N.A. , 84 AD3d 588, 589, 923 N.Y.S.2d 479 (1st Dept. 2001) [dismissing the fraud claim as duplicative of the contract claim where the two claims "sought identical damages."]; Coppola, 288 AD2d 42, 732 N.Y.S.2d 402 (1st Dept. 2001) [affirming the dismissal of a fraud claim that "did not allege any damages ... that would not be recoverable under a contract measure of damages"]; Tesoro Petroleum Corp. v. Holborn Oil Co. , 108 AD2d 607, 484 N.Y.S.2d 834 (1st Dept. 1985).
However, this principle applies only to certain parties. A "fraud claim may be dismissed as duplicative only as against a defendant against whom the related contract claim is viable"; it does not bar claims against a person who "was not a party to his company's contract, and is being sued personally for his [allegedly] willful misrepresentations, not for breach of any contract." Integrated Constr. Enterprises, Inc. v. GN Erectors, Inc. , 16 CIV. 5561 (PAE), 2020 WL 614991, at 5 (SDNY Feb. 10, 2020), quoting, Sun Prod. Corp. v. Bruch, 507 F. App'x 46, 47–48 (2d Cir. 2013), citing, Richbell Info. Servs. v. Jupiter Partners, L.P., 765 N.Y.S.2d 575, 589 (1st Dept. 2003) ; In re Fyre Festival Litig., 399 F. Supp. 3d 203, 212 (S.D.N.Y. 2019) ; Taylor Precision Prod., Inc. v. Larimer Grp., Inc., No. 15 Civ. 4428 (ALC), 2018 WL 4278286, at 19 (S.D.N.Y. Mar. 26, 2018) ; Wild Bunch, SA v. Vendian Entm't, LLC, 256 F. Supp. 3d 497, 502–03 (S.D.N.Y. 2017) ; Estrada v. Dugow, No. 15 Civ. 3189 (ER), 2016 WL 1298993, at 5 n.5 (S.D.N.Y. Mar. 31, 2016) ; Schwartzco Enters. LLC v. TMH Mgmt., LLC, 60 F. Supp. 3d 331, 353 (E.D.N.Y. 2014).
Thus, "a fraud claim may be dismissed as duplicative only as against a defendant against whom the related contract claim is viable." Richbell Info. Servs. v. Jupiter Partners, L.P., 309 AD2d 288, 765 N.Y.S.2d 575, 589 (1st Dept. 2003) ; Sun Products Corp. v. Bruch , 507 Fed. Appx. 46, 47-48 (2d Cir., NY, 2013) ; Wild Bunch, SA v. Vendian Entertainment, LLC , 256 F. Supp. 3d 497, 502-03 (S.D.NY 2017) (defendants motion to dismiss plaintiff's fraud claims as duplicative, not only against the defendant corporation, but also against individual defendant Michael Bassick, Vendian's president, was denied because he was not a party to the contracts); Taylor Precision Products, Inc. v. Larimer Group, Inc. , 2018 WL 4278286, at *19 (S.D.N.Y 2018) (the fraud claims asserted against the non-seller defendants was denied because a fraud claim may be dismissed as duplicative only as against a defendant against whom the related contract claim is viable); Allenby, LLC v. Credit Suisse, AG , 134 AD3d 577, 581 (1st Dept. 2015) (since the fraud claim is asserted against all three defendants, but a contract claim is asserted against only CS—CIB, the fraud claim cannot be duplicative as to the defendants who were not parties to the contract); Lenox Hill Hosp. v. Am. Intern. Group, Inc. , 31 Misc. 3d 1243(A) (Sup. Ct., New York County, 2011) (Although plaintiff's fraud claim is pleaded with particularity, as to the contracting defendant, it is duplicative of the breach of contract claims in the amended complaint and the court dismissed the fraud claim against the contracting defendant, but allowed the plaintiff to amend its complaint to add a fraud cause of action as against the non-contracting defendant).
In the present action, as against defendant Brook Hill Development, Inc., any alleged claim of fraud is not sufficiently distinct, collateral or extraneous to the underlying contract and, as a result, any claim of fraud against the corporate defendant is dismissed. See; Sforza v. Health Ins. Plan of Greater NY, 210 AD2d 214, 619 N.Y.S.2d 734 (2d Dept. 1994) ; McKernin v. Fanny Farmer Candy Shops, 176 AD2d 233, 234, 574 N.Y.S.2d 58 (2d Dept. 1991) ; Gupta Realty Corp. v. Gross , 251 AD2d 544, 545 (2d Dept. 1998). With respect to the individual defendants, since they are not parties to the contract, a breach of contract claim is not viable against them and, therefore, the fraud claim is not duplicative of the plaintiffs' breach of contract claims. Allenby, LLC v. Credit Suisse, AG , 134 AD3d 577, 581 (1st Dept. 2015) ; Richbell Info. Servs. v. Jupiter Partners, L.P. , 765 N.Y.S.2d 575, 589 (1st Dept. 2003) ; Lenox Hill Hosp. v. Am. Intern. Group, Inc. , 31 Misc 3d 1243(A) (Sup. Ct., New York County, 2011). The defendants' assertion that they were always acting in their corporate capacity concerning any representations made to the plaintiffs has been sufficiently refuted by the plaintiff's affidavit and documentation asserting that defendant Woodard's emails are not signed as a representative of defendant Brookhill, but were merely signed "Jerri." [Bianchi 1-31-20 Affidavit ¶10] and that defendant Waehner's emails come from her personal Comcast email account, and not from a business account [Bianchi 1-31-20 Affidavit ¶10].
Based on the foregoing, the defendant's motion to dismiss the small claims complaint as against defendants Woodard and Waehner is granted in part and denied in part. To the extent that the complaint alleges a breach of contract claim against the individual defendants, that claim is dismissed. However, to the extent that the complaint alleges a claim of fraud against the individual defendants, the motion is denied.