Summary
listing the elements of a fraudulent inducement claim
Summary of this case from Picini v. Chase Home Finance LLCOpinion
2011-11-1
ORCHID CONSTRUCTION CORP., appellant,v.Adam GOTTBETTER, et al., respondents.
Mavromihalis Pardalis & Nohavicka, LLP, Astoria, N.Y. (Ioanna Vasiliu of counsel; Lauren Rodriguez on the brief), for appellant.Venturini & Associates, New York, N.Y. (August C. Venturini of counsel), for respondent Adam Gottbetter.Timothy P. Kebbe, White Plains, N.Y., for respondent John Malabre.
Mavromihalis Pardalis & Nohavicka, LLP, Astoria, N.Y. (Ioanna Vasiliu of counsel; Lauren Rodriguez on the brief), for appellant.Venturini & Associates, New York, N.Y. (August C. Venturini of counsel), for respondent Adam Gottbetter.Timothy P. Kebbe, White Plains, N.Y., for respondent John Malabre.
In an action, inter alia, to recover damages for breach of contract and fraud, the plaintiff appeals from an order of the Supreme Court, Queens County (Kitzes, J.), dated July 6, 2010, which granted those branches of the defendants' separate motions which were pursuant to CPLR 3211(a)(7) to dismiss the complaint insofar as asserted against each of them.
ORDERED that the order is affirmed, with one bill of costs.
The plaintiff is a contractor who performed renovation work at the apartment of the defendant Adam Gottbetter in the City of New York pursuant to a home improvement contract. The defendant John Malabre, a project manager for a construction project at the apartment building, allegedly negotiated the terms of the agreement and directed the plaintiff's work. The plaintiff commenced this action against Gottbetter and Malabre, alleging, among other things, that Gottbetter breached the contract by failing to compensate it for its work, and that Malabre fraudulently induced it to enter into the contract with Gottbetter. The defendants separately moved, inter alia, pursuant to CPLR 3211(a)(7) to dismiss the complaint insofar as asserted against each of them. Gottbetter argued that the plaintiff was an unlicensed home improvement contractor, and thus the complaint failed to state a cause of action against him. Malabre argued that the complaint failed to state a cause of action against him to recover damages for conversion, fraud in the inducement, and tortious interference with contractual rights. The Supreme Court granted those branches of the separate motions which were pursuant to CPLR 3211(a)(7) to dismiss the complaint insofar as asserted against the movants. We affirm.
“An unlicensed contractor may neither enforce a home improvement contract against an owner nor seek recovery in quantum meruit” ( J.M. Bldrs. & Assoc., Inc. v. Lindner, 67 A.D.3d 738, 741, 889 N.Y.S.2d 60 [internal quotation marks omitted]; see B & F Bldg. Corp. v. Liebig, 76 N.Y.2d 689, 691, 563 N.Y.S.2d 40, 564 N.E.2d 650; Quick Start Constr. Corp. v. Staiger, 77 A.D.3d 900, 910 N.Y.S.2d 131; Flax v. Hommel, 40 A.D.3d 809, 810, 835 N.Y.S.2d 735). Since the plaintiff was unlicensed and therefore failed to plead possession of a valid home improvement contracting license ( see CPLR 3015[e]; Administrative Code of City of N.Y. § 20–387[a] ), the Supreme Court properly granted that branch of Gottbetter's motion which was pursuant to CPLR 3211(a)(7) to dismiss the complaint insofar as asserted against him, alleging causes of action to recover damages for breach of contract (first cause of action), in quantum meruit (second cause of action), on an account stated (third
cause of action), and for unjust enrichment (fourth cause of action) ( see J.M. Bldrs. & Assoc., Inc. v. Lindner, 67 A.D.3d at 741, 889 N.Y.S.2d 60; Flax v. Hommel, 40 A.D.3d at 810, 835 N.Y.S.2d 735). The plaintiff contends that it was not required to possess a license, because it was Malabre's subcontractor and did not enter into a contract with Gottbetter. This contention directly contradicts the allegations in the plaintiff's verified complaint ( see Schuit v. Tree Line Mgt. Corp., 46 A.D.3d 405, 406, 847 N.Y.S.2d 580; LeBreton v. Weiss, 256 A.D.2d 47, 47–48, 680 N.Y.S.2d 532), and, in any event, is without merit. The Administrative Code of the City of New York requires all home improvement contractors to be licensed, whether they are prime contractors or subcontractors with respect to the owner ( see Administrative Code of City of N.Y. § 20–386[5], [6]; § 20–387[a]; Chosen Constr. Corp. v. Syz, 138 A.D.2d 284, 284–286, 525 N.Y.S.2d 848; cf. Price v. Close, 302 A.D.2d 374, 375, 754 N.Y.S.2d 660). Accordingly, the Supreme Court properly held that Gottbetter was entitled to dismissal of the complaint insofar as asserted against him.
Moreover, the Supreme Court properly granted that branch of Malabre's motion which was pursuant to CPLR 3211(a)(7) to dismiss the complaint insofar as asserted against him, alleging causes of action to recover damages for conversion (fifth cause of action), fraud in the inducement (sixth cause of action), and tortious interference with contractual rights (seventh cause of action).
Accepting the facts alleged in the complaint as true, and according the plaintiff the benefit of every favorable inference ( see Leon v. Martinez, 84 N.Y.2d 83, 614 N.Y.S.2d 972, 638 N.E.2d 511), the complaint fails to state a cause of action to recover damages for conversion against Malabre. “Although the plaintiff alleged a contractual right to payment for renovation work it performed on premises owned by [Gottbetter], it never had ownership, possession, or control of” the funds allegedly converted by Malabre ( Castaldi v. 39 Winfield Assoc., 30 A.D.3d 458, 458–459, 820 N.Y.S.2d 279; see Daub v. Future Tech Enters., Inc., 65 A.D.3d 1004, 1006, 885 N.Y.S.2d 115; Fiorenti v. Central Emergency Physicians, 305 A.D.2d 453, 454, 762 N.Y.S.2d 402).
Further, the court properly held that the plaintiff's cause of action alleging fraud in the inducement should be dismissed. “The elements of a cause of action sounding in fraud are a material misrepresentation of an existing fact, made with knowledge of the falsity, an intent to induce reliance thereon, justifiable reliance upon the misrepresentation, and damages” ( Introna v. Huntington Learning Ctrs., Inc., 78 A.D.3d 896, 898, 911 N.Y.S.2d 442; see Eurycleia Partners, LP v. Seward & Kissel, LLP, 12 N.Y.3d 553, 559, 883 N.Y.S.2d 147, 910 N.E.2d 976). CPLR 3016(b) requires that “the circumstances of the fraud must be stated in detail, including specific dates and items” ( Moore v. Liberty Power Corp., LLC, 72 A.D.3d 660, 661, 897 N.Y.S.2d 723 [internal quotation marks omitted] ). The plaintiff did not set forth the time or place of Malabre's alleged misrepresentation ( see Morales v. AMS Mtge. Servs., Inc., 69 A.D.3d 691, 692, 897 N.Y.S.2d 103; Eastman Kodak Co. v. Roopak Enters., 202 A.D.2d 220, 222, 608 N.Y.S.2d 445), and failed to properly plead the elements of misrepresentation of a material fact and justifiable reliance with specificity ( see Brualdi v. IBERIA, Lineas Aereas de España, S.A., 79 A.D.3d 959, 960–961, 913 N.Y.S.2d 753; Couri v. Westchester Country Club, 186 A.D.2d 712, 714, 589 N.Y.S.2d 491).
The Supreme Court also properly held that the cause of action to recover damages for tortious interference with contractual rights should be dismissed, since the plaintiff failed to adequately plead the existence of a valid contract between the plaintiff and Gottbetter, and that Malabre intentionally procured Gottbetter's breach of that contract ( see Dune Deck Owners Corp. v. Liggett, 85 A.D.3d 1093, 1095, 927 N.Y.S.2d 125; J.M. Bldrs. & Assoc., Inc. v. Lindner, 67 A.D.3d at 741, 889 N.Y.S.2d 60; see also Jaffe v. Gordon, 240 A.D.2d 232, 658 N.Y.S.2d 612). To the extent that this cause of action may be construed as one to recover damages for tortious interference with business relations, the plaintiff failed to allege that Malabre used wrongful means to interfere with the plaintiff's relationship with Gottbetter, or that his motive was solely to harm the plaintiff ( see Habitat, Ltd. v. Art of the Muse, Inc., 81 A.D.3d 594, 595, 916 N.Y.S.2d 174; see also Carvel Corp. v. Noonan, 3 N.Y.3d 182, 189–191, 785 N.Y.S.2d 359, 818 N.E.2d 1100). Similarly, to the extent that the complaint asserted a cause of action to recover in quantum meruit against Malabre, it failed to adequately plead the cause of action, as it did not allege that Malabre accepted services from the plaintiff or that the plaintiff “had a reasonable expectation of compensation from [Malabre]” ( Fulbright & Jaworski, LLP v. Carucci, 63 A.D.3d 487, 489, 881 N.Y.S.2d 56). Accordingly, the Supreme Court properly granted that branch of Malabre's motion which was pursuant to CPLR 3211(a)(7) to dismiss the complaint insofar as asserted against him.
The plaintiff's remaining contentions are improperly raised for the first time on appeal or without merit.