Opinion
No. 2021-05093 Index No. 518689/18
09-25-2024
Plymouth Capital, LLC, et al., appellants, v. Montage Financial Group, Inc., respondent, et al., defendant.
Hubell & Associates LLC, New York, NY (Richard A. Hubell and Barry A. Cozier of counsel), for appellants. Gordon Rees Scully Mansukhani, LLP, New York, NY (Mark A. Beckman, Adam J. Hiller, and Sarah K. Prager of counsel), for respondent.
Hubell & Associates LLC, New York, NY (Richard A. Hubell and Barry A. Cozier of counsel), for appellants.
Gordon Rees Scully Mansukhani, LLP, New York, NY (Mark A. Beckman, Adam J. Hiller, and Sarah K. Prager of counsel), for respondent.
COLLEEN D. DUFFY, J.P., PAUL WOOTEN, DEBORAH A. DOWLING, LILLIAN WAN, JJ.
DECISION & ORDER
In an action, inter alia, to recover damages for breach of contract, the plaintiffs appeal from an order of the Supreme Court, Kings County (Loren Baily-Schiffman, J.), dated May 6, 2021. The order granted the motion of the defendant Montage Financial Group, Inc., pursuant to CPLR 3211(a) to dismiss the complaint insofar as asserted against it.
ORDERED that the order is affirmed, with costs.
The plaintiffs commenced this action against the defendants, Montage Financial Group, Inc. (hereinafter Montage), and Brett M. Smith, former vice president of the plaintiff Plymouth Capital, LLC (hereinafter Plymouth), seeking, inter alia, to recover damages for breach of contract, tortious interference with contract, tortious interference with prospective business relations, aiding and abetting breach of fiduciary duty, and unjust enrichment, and to recover in quantum meruit. The plaintiffs alleged, among other things, that in August 2015, Plymouth entered into an exclusive agency agreement with Melton Mullinix, Jr., the owner of a life insurance policy (hereinafter the policy), and Melton Mullinix, Sr., the insured under the policy (hereinafter together the Mullinix family), for Plymouth to serve as the exclusive agent of record with respect to the sale of the policy. The plaintiffs also alleged that, in September 2015, Montage presented an offer to purchase the policy for the sum of $1,500,000 to Smith, who was operating on behalf of Plymouth. In September 2015, Plymouth, by the plaintiff Christian John Woodcock, a life insurance settlement broker, executed and returned a contract request form for the sale of the policy to Montage. According to the plaintiff, Smith then formed Sterling Settlements, LLC (hereinafter Sterling), and procured an agreement signed by the Mullinix family naming Sterling, instead of Plymouth, as the exclusive agent of record for the sale of the policy. The plaintiffs further alleged that Montage wrongfully compensated Smith for the sale of the policy and that the plaintiffs were not compensated for the transaction.
Thereafter, Montage moved pursuant to CPLR 3211(a) to dismiss the complaint insofar as asserted against it. In an order dated May 6, 2021, the Supreme Court granted the motion. The plaintiffs appeal.
To prevail on a motion pursuant to CPLR 3211(a)(1), the movant's evidence "'must utterly refute the plaintiff's factual allegations, conclusively establishing a defense as a matter of law'" (Magee-Boyle v Reliastar Life Ins. Co. of N.Y., 173 A.D.3d 1157, 1159, quoting Gould v Decolator, 121 A.D.3d 845, 847; see Hart 230, Inc. v PennyMac Corp., 194 A.D.3d 789, 790). As relevant to this case, contracts "'and any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence'" (Magee-Boyle v Reliastar Life Ins. Co. of N.Y., 173 A.D.3d at 1159, quoting Fontanetta v John Doe 1, 73 A.D.3d 78, 84-85; see Mehrof v Monroe-Woodbury Cent. Sch. Dist., 168 A.D.3d 713, 715). Further, when reviewing a "motion to dismiss a complaint pursuant to CPLR 3211(a)(7), the court must afford the pleading a liberal construction, accept the facts as alleged in the complaint as true, accord the plaintiff the benefit of every favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory" (Fox Paine & Co., LLC v Houston Cas. Co., 153 A.D.3d 673, 676; see Himmelstein, McConnel, Gribben, Donoghue & Joseph, LLP v Matthew Bender & Co., Inc., 37 N.Y.3d 169, 175).
Contrary to the plaintiffs' contention, the Supreme Court properly granted that branch of Montage's motion which was to dismiss the cause of action alleging tortious interference with contract insofar as asserted against it. The elements of a cause of action for tortious interference with a contract are "'(1) the existence of a valid contract between the plaintiff and a third party, (2) the defendant's knowledge of that contract, (3) the defendant's intentional procurement of a third-party's breach of that contract without justification, and (4) damages'" (Pare v Aalbue, 222 A.D.3d 769, 774, quoting Nagan Constr., Inc. v Monsignor McClancy Mem. High Sch., 117 A.D.3d 1005, 1006; see Tumayeva v Geyber, 220 A.D.3d 634, 636). The plaintiff must further allege facts sufficient to show that "'the contract would not have been breached but for the defendant's conduct'" (Grocery Leasing Corp. v P & C Merrick Realty Co., LLC, 197 A.D.3d 628, 629, quoting Barry's Auto Body of NY, LLC v Allstate Fire & Cas. Ins. Co., 190 A.D.3d 807, 810 [internal quotation marks omitted]; see Petric & Assoc., Inc. v Travelers Cas. & Sur. Co., 196 A.D.3d 520, 521). Here, the plaintiffs failed to sufficiently allege specific conduct by Montage intended to procure a breach of the exclusive agency agreement between Plymouth and the Mullinix family, or that the contract would not have been breached but for Montage's conduct (see Klein v Deutsch, 193 A.D.3d 707, 710; Kimso Apts., LLC v Rivera, 180 A.D.3d 1033, 1035-1036).
Further, the Supreme Court properly granted that branch of Montage's motion which was to dismiss the cause of action alleging tortious interference with prospective business relations insofar as asserted against it. To establish a cause of action for tortious interference with prospective business relations, the plaintiff must allege "'(1) that [the plaintiff] had a business relationship with a third party; (2) that the defendant knew of that relationship and intentionally interfered with it; (3) that the defendant acted solely out of malice or used improper or illegal means that amounted to a crime or independent tort; and (4) that the defendant's interference caused injury to the relationship with the third party'" (Joseph v Fensterman, 204 A.D.3d 766, 771, quoting Amaranth LLC v J.P. Morgan Chase & Co., 71 A.D.3d 40, 47). The plaintiff must also meet a "'more culpable conduct' standard," which is met "where the interference with prospective business relations was accomplished by wrongful means or where the offending party acted for the sole purpose of harming the other party" (Law Offs. of Ira H. Leibowitz v Landmark Ventures, Inc., 131 A.D.3d 583, 585, quoting NBT Bancorp v Fleet/Norstar Fin. Group, 87 N.Y.2d 614, 621; see Influx Capital, LLC v Pershin, 186 A.D.3d 1622, 1624). "[C]onduct which is motivated by economic self-interest cannot be characterized as solely malicious" (Stuart's, LLC v Edelman, 196 A.D.3d 711, 714; see Lynch Dev. Assoc., Inc. v Johnson, 219 A.D.3d 1328, 1330). Here, the plaintiffs failed to sufficiently allege that Montage acted with the requisite conduct needed to sustain a cause of action alleging tortious interference with prospective business relations (see Sperling v Amoachi, 191 A.D.3d 913, 915; Influx Capital, LLC v Pershin, 186 A.D.3d at 1625).
The Supreme Court also properly granted that branch of Montage's motion which was to dismiss the cause of action asserted against it alleging aiding and abetting breach of fiduciary duty. To assert a cause of action for aiding and abetting breach of fiduciary duty, the plaintiff must allege, with particularity (see CPLR 3016[b]), "knowledge of the alleged tortious conduct by the aider and abettor, and substantial assistance by the aider and abettor in the achievement of the tortious conduct" (Land v Forgione, 177 A.D.3d 862, 864; see Smallberg v Raich Ende Malter & Co., LLP, 140 A.D.3d 942, 944). "'Substantial assistance requires an affirmative act on the defendant's part; mere inaction can constitute substantial assistance only if the defendant owes a fiduciary duty directly to the plaintiff'" (Land v Forgione, 177 A.D.3d at 864, quoting Baron v Galasso, 83 A.D.3d 626, 629). Here, the plaintiffs failed to sufficiently allege that Montage provided "substantial assistance" to Smith with respect to Smith's alleged breach of his fiduciary duty to Plymouth (see RD Legal Funding Partners, LP v Worby Groner Edelman & Napoli Bern, LLC, 195 A.D.3d 968, 970; Sanford/Kissena Owners Corp. v Daral Props., LLC, 84 A.D.3d 1210, 1212-1213).
Contrary to the plaintiffs' contention, the Supreme Court also properly granted those branches of Montage's motion which were to dismiss the causes of action asserted against it alleging breach of contract, quantum meruit, and unjust enrichment, as the plaintiffs failed to allege the existence of a written agreement between Plymouth and Montage pursuant to General Obligations Law § 5-701(a)(10) (see Snyder v Bronfman, 13 N.Y.3d 504, 510; Ausch v Sutton, 151 A.D.3d 802, 803).
The parties' remaining contentions either need not be reached in light of our determination or are without merit.
Accordingly, the Supreme Court properly granted Montage's motion pursuant to CPLR 3211(a) to dismiss the complaint insofar as asserted against it.
DUFFY, J.P., WOOTEN, DOWLING and WAN, JJ., concur.