CFJ Associates of New York, Inc. v. Hanson Industries

274 A.D.2d 892, 711 N.Y.S.2d 232, 2000 N.Y. App. Div. LEXIS 8258
CourtAppellate Division of the Supreme Court of the State of New York
DecidedJuly 27, 2000
StatusPublished
Cited by19 cases

This text of 274 A.D.2d 892 (CFJ Associates of New York, Inc. v. Hanson Industries) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
CFJ Associates of New York, Inc. v. Hanson Industries, 274 A.D.2d 892, 711 N.Y.S.2d 232, 2000 N.Y. App. Div. LEXIS 8258 (N.Y. Ct. App. 2000).

Opinion

—Rose, J.

Appeal from an order of the Supreme Court (Coutant, J.), entered July 12, 1999 in Broome County, which, inter alia, denied plaintiffs motion to amend the complaint and granted defendants’ cross motion for partial summary judgment dismissing the fraud cause of action in the amended complaint.

This litigation involves a contract for plaintiffs purchase of [893]*893certain real property requiring environmental cleanup and the relevant underlying facts are set forth in our decision of an earlier appeal in this action (260 AD2d 917). After this Court’s affirmance (id.) and following discovery, plaintiff moved to amend its complaint a second time to add the law firm of Bressler, Amery & Ross (hereinafter BAR) as a party defendant, add an additional cause of action alleging professional negligence against defendant Dames & Moore (hereinafter D&M), and add a cause of action under the Federal Racketeer Influenced and Corrupt Organizations Act (hereinafter RICO; see, 18 USC § 1961 et seq.). Defendants opposed this motion and then moved for partial summary judgment dismissing, inter alia, plaintiff’s second cause of action in the first amended complaint sounding in fraud.

In a thorough and well-reasoned decision, Supreme Court concluded that plaintiffs second cause of action, alleging that defendants used a false cost estimate of $1,321,850 for cleanup of the property as part of a fraudulent scheme to make plaintiff responsible for a greater share of those costs under the contract of sale, lacked merit because plaintiff could not have reasonably relied on an earlier oral representation that the cleanup would cost approximately $750,000. This determination rested primarily on express provisions of the contract stating that plaintiff was relying on its own experts in assessing the subject property, that defendant Endicott Johnson Corporation (hereinafter EJ) made no representation or warranty regarding the accuracy of information provided regarding the property’s environmental characteristics, and that plaintiff had the right to terminate the contract due to higher cleanup costs within a specified time period. Supreme Court also dismissed the amended complaint against D&M because that environmental consulting firm had not been in privity, or a functionally equivalent relationship, with plaintiff. Supreme Court denied plaintiffs motion to amend its complaint by adding the civil RICO claim because, absent fraud, plaintiff could not state a cause of action under RICO. Lastly, plaintiffs motion to add BAR as a defendant was denied, again due to the absence of a potentially meritorious fraud cause of action.

As is relevant on this appeal, the essence of plaintiffs cause of action for fraud is that defendants’ actions in allegedly fraudulently concealing the actual estimated cost of the property cleanup induced plaintiff to enter into the contract and thereafter make expenditures to fulfill the contract in reliance [894]*894on cost estimates provided by defendants.

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Bluebook (online)
274 A.D.2d 892, 711 N.Y.S.2d 232, 2000 N.Y. App. Div. LEXIS 8258, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cfj-associates-of-new-york-inc-v-hanson-industries-nyappdiv-2000.