Opinion
12323 Index No. 161431/18 Case No. 2020-02252
11-10-2020
WAY FAMILY TRUST, BY AND THROUGH its Co-Trustees Gregory ELMORE, etc., Plaintiff–Appellant, v. SAGEPOINT FINANCIAL, INC., et al., Defendants–Respondents.
Jonathan E. Neuman, Fresh Meadows, for appellant. Winget, Spadafora & Schwartzberg, LLP, New York (Steven E. Mellen of counsel), for respondents.
Jonathan E. Neuman, Fresh Meadows, for appellant.
Winget, Spadafora & Schwartzberg, LLP, New York (Steven E. Mellen of counsel), for respondents.
Friedman, J.P., Renwick, Oing, Mendez, JJ.
Order, Supreme Court, New York County (Jennifer G. Schecter, J.), entered on or about September 27, 2019, which granted defendants' motion to dismiss the complaint as time-barred, unanimously affirmed, without costs.
Plaintiff alleges that it invested some $1.4 million in investments, and that it instructed its broker/investment advisor (broker) that its paramount goal was the safety of those investments. Plaintiff alleges that the broker instead placed the funds in risky investments, which consequently lost about $550,000. The broker left defendants' employ in 2009, and plaintiff permitted him to continue servicing its financial needs at other financial institutions. Plaintiff commenced this action in 2018. Supreme Court properly found that plaintiff's breach of fiduciary claim against defendants, whether analyzed under the three or six-year statute of limitations, is time-barred because the accrual date occurred in 2009, when the broker left defendants' employ. As defendants are not "professionals" for purposes of the continuous representation doctrine, plaintiff may not avail itself of that doctrine to render its claims here timely (see Starr v. Fuoco Group LLP , 137 A.D.3d 634, 634, 26 N.Y.S.3d 853 [1st Dept. 2016], lv dismissed 28 N.Y.3d 1083, 44 N.Y.S.3d 377, 66 N.E.3d 1095 [2016] ; Leather v. United States Trust Co. of N.Y. , 279 A.D.2d 311, 311–312, 720 N.Y.S.2d 448 [1st Dept. 2001] ). In any event, the continuous representation doctrine so as to toll the limitations period does not apply because plaintiff no longer had a relationship with defendants as of 2009. Nor does the discovery rule shield this claim from dismissal. The substantial investment losses –about 39% in a short time – should reasonably have put plaintiff on notice that the investments made by the broker were not the "safe" ones it had been promised (see Aozora Bank, Ltd. v. Credit Suisse Group , 144 A.D.3d 437, 438, 40 N.Y.S.3d 407 [1st Dept. 2016], lv denied 28 N.Y.3d 914, 2017 WL 580047 [2017] ; Gutkin v. Siegal , 85 A.D.3d 687, 688, 926 N.Y.S.2d 485 [1st Dept. 2011] ).
Furthermore, plaintiff's contention that defendants' fraudulent conduct should equitably estop them from raising the statute of limitations, is unavailing. The misrepresentations underlying the claim of estoppel are the same as those constituting the breach of fiduciary duty (see Knobel v. Shaw , 90 A.D.3d 493, 494, 936 N.Y.S.2d 2 [1st Dept. 2011] ; Kaufman v. Cohen , 307 A.D.2d 113, 122, 760 N.Y.S.2d 157 [1st Dept. 2003] ).