Charid Properties, Inc. v. Berger

37 A.D.2d 987, 327 N.Y.S.2d 821, 1971 N.Y. App. Div. LEXIS 2916

Opinion

In an action by a vendee under a contract to sell real property to rescind the sale and for damages, defendants appeal from an order of the Supreme Court, Kings County, dated July 15, 1971, which denied their motion to dismiss the complaint and for summary judgment. Order reversed, on the law, with $20 costs and disbursements, and motion for summary judgment granted. Plaintiff claims it was induced to enter into a contract for the sale of certain real property by defendants’ false representations as to the amount of the annual rental due during the first of two successive, optional 10-year renewal periods, the sale being subject to a net lease. The Special Term denied defendants’ motion for summary judgment, holding that their denial of the alleged misrepresentations raised factual questions warranting a trial. In our opinion, the complaint must be dismissed as a matter of law, even assuming that defendants had made the representations alleged. The representations, if made, were of opinion or law (Zuyder Zee Land Corp. v. Broadmain Bldg. Co., 86 N. Y. S. 2d 827, affd. 276 App. Div. 751, mot. for lv. to app. den. 276 App. Div. 834). Appellants’ “admission” that the sellers purchased the property in 1967 with the understanding that the annual rental during the first renewal period was lower than that allegedly represented to respondent does not prove scienter. At most, it tends to establish only that appellants misrepresented their own opinion as to the legal interpretation of the provisions of the amended lease. More important, however, respondent has failed to establish justifiable reliance upon the alleged misrepresentations. Inasmuch as the sale was eoncededly made subject to the amended lease, which was exhibited to and examined by respondent’s president and attorney, the rental provisions of the lease must control. Respondent has proved none of the elements necessary to support a cause of action in fraud, including misrepresentation of a material fact, scienter and reliance. Rabin, P. J., Hopkins, Munder, Martuseello and Shapiro, JJ., concur.