Opinion
No. 2023-49 Q C
11-03-2023
Keisha Smith, Appellant, v. Holly Hodge, Respondent.
David A. Bythewood, for appellant. Holly Hodge, respondent pro se.
Unpublished Opinion
David A. Bythewood, for appellant.
Holly Hodge, respondent pro se.
PRESENT:: CHEREÉ A. BUGGS, J.P., MARINA CORA MUNDY, PHILLIP HOM, JJ
Appeal, on the ground of inadequacy, from a decision of the Civil Court of the City of New York, Queens County (Claudia Lanzetta, J.), dated December 27, 2022, deemed from a judgment of that court entered January 19, 2023 (see CPLR 5512 [a]). The judgment, insofar as appealed from, after a nonjury trial, awarded plaintiff the principal sum of $10,000.
ORDERED that the judgment, insofar as appealed from, is reversed, without costs, and the matter is remitted to the Civil Court for a new trial limited to the issue of damages.
Plaintiff commenced this action to recover $50,000. The evidence adduced at a nonjury trial showed that the parties were in a relationship for a year and at half, had lived together, and were once engaged. In January 2021, plaintiff provided defendant with $50,000 for a laundromat which defendant claimed she was planning to open. Nothing was ever put into writing regarding this venture, and defendant testified that the venture subsequently "fell through." Defendant also testified, among other things, that plaintiff was not entitled to the return of $50,000 since defendant had used the money to renovate plaintiff's house, which included a pool, that defendant had paid for numerous repairs and upgrades to plaintiff's house, had purchased furniture and appliances for the house, and had purchased other miscellaneous items on plaintiff's behalf. Defendant provided credit card and bank statements and receipts in support of her claims. Plaintiff testified that furniture was purchased for her house and that she gave defendant cash to use for household needs which included the renovation of her house.
Following the trial, the Civil Court found that "plaintiff loaned defendant $50,000.00 that was not used for its intended purpose." The court also found that defendant "did use a large portion of that loan to the sole and exclusive benefit of plaintiff by paying for costs relative to plaintiff's home, including the furnishing and repair of same, such that awarding full judgment to plaintiff would result in a windfall." The court awarded plaintiff $10,000, thereby implicitly crediting defendant with $40,000. Although the court acknowledged that "not all [of defendant's] highlighted expenditures carry a sufficient or supported explanation," the written decision after trial does not detail how the court calculated these sums. On appeal, plaintiff contends, among other things, that the Civil Court erroneously determined that she had "loaned" defendant $50,000 rather than that she had given the money to defendant as an investment in a business venture; that defendant failed to return the $50,000 to her; and that the Civil Court erred by not finding that defendant had fraudulently induced her to invest $50,000.
To establish her fraudulent inducement claim, plaintiff had to establish that defendant made "a misrepresentation or a material omission of fact which was false and known to be false by 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" (Lama Holding Co. v Smith Barney, 88 N.Y.2d 413, 421 [1996]; see United States Life Ins. Co. in the City of NY v Horowitz, 192 A.D.3d 613, 614 [2021]), which plaintiff failed to do. Moreover, whether the $50,000 was loaned to defendant so that she could open a laundromat, or was given to defendant as an investment in the laundromat is of no import since it is uncontroverted that the laundromat was never opened, the $50,000 was not used for the laundromat, and the $50,000 remained in defendant's personal checking account.
Upon a review of the record, we find that defendant failed to establish various claimed expenses. For example, the numerous written notations on defendant's bank statements indicating that purchases at Home Depot and Lowes, transfers to workers, and cash withdrawals from defendant's personal checking were made to purchase supplies, or pay workers on plaintiff's behalf, without more, were insufficient to establish that those payments or purchases were in fact made on plaintiff's behalf as a form of repayment of the $50,000 plaintiff had transferred to defendant. Defendant's testimony regarding how she spent the cash was conclusory-she did not specify what workers she gave the cash to or what work it was for, and she did not provide receipts for any supplies she claimed to have purchased. Also, even though defendant's statements show that payments were made to Home Depot and Lowes, no testimony was provided as to what was specifically purchased at these stores. Due to these deficiencies, it is unclear how the Civil Court arrived at many of the credits to defendant, let alone credits totaling $40,000. Consequently, the Civil Court's $10,000 judgment in favor of plaintiff is not supported by the evidence.
Accordingly, the judgment, insofar as appealed from, is reversed and the matter is remitted to the Civil Court for a new trial limited to the issue of damages.
BUGGS, J.P., MUNDY and HOM, JJ., concur.