Gochberg v. Sovereign Apartments, Inc.

Appellate Division of the Supreme Court of New York

Gochberg v. Sovereign Apartments, Inc.

119 A.D.3d 431, 988 N.Y.S.2d 489

CourtAppellate Division of the Supreme Court of the State of New York

DecidedJuly 3, 2014

Docket12916 652382/12

StatusPublished

Cited by2 cases

This text of 119 A.D.3d 431 (Gochberg v. Sovereign Apartments, Inc.) 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

Gochberg v. Sovereign Apartments, Inc., 119 A.D.3d 431, 988 N.Y.S.2d 489 (N.Y. Ct. App. 2014).

Pincite

Opinion

Order, Supreme Court, New York County (Anil C. Singh, J.), entered April 10, 2013, which granted defendants Alan Kersh *432 and Paul Bloom’s (defendants) motion to dismiss the fifth cause of action pursuant to CPLR 3211 (a) (7), unanimously reversed, on the law, without costs, and the motion denied.

Since the fifth cause of action (breach of fiduciary duty) is a tort — not a contract — claim, plaintiffs are not required to allege that defendants’ actions were taken in their individual capacity instead of as directors of defendant Sovereign Apartments, Inc. (SAI) (see Fletcher v Dakota, Inc., 99 AD3d 43, 49 [1st Dept 2012]). Contrary to defendants’ contention, plaintiffs’ breach of fiduciary duty claim is not a breach of contract claim in disguise. Unlike Brasseur v Speranza (21 AD3d 297 [1st Dept 2005]), on which defendants rely, the complaint in the instant action alleges that individual board members “breached a duty other than, and independent of, those contractually imposed upon the board” {id. at 298). In particular, it alleges that defendants interfered with plaintiff John Gochberg’s contract with nonparty EMSL Analytical Inc. by surreptitiously inducing EMSL to send to the board, rather than Mr. Gochberg, the results of the testing for which Mr. Gochberg had contracted. Such interference, if proven, would constitute a tortious act of affirmative malfeasance for which a board member, if proven personally to have committed it or to have caused its commission, would be subject to personal liability. Further, whether the business judgment rule protects defendants’ actions cannot be determined as a matter of law on the pleadings since defendants’ alleged action in going behind Mr. Gochberg’s back to have EMSL’s analysis delivered to SAI instead of Mr. Gochberg smacks of bad faith (Ackerman v 305 E. 40th Owners Corp., 189 AD2d 665, 667 [1st Dept 1993]).

Concur — Friedman, J.P., Sweeny, Andrias, Saxe and Kapnick, JJ.

Free access — add to your briefcase to read the full text and ask questions with AI

Order, Supreme Court, New York County (Anil C. Singh, J.), entered April 10, 2013, which granted defendants Alan Kersh *432 and Paul Bloom’s (defendants) motion to dismiss the fifth cause of action pursuant to CPLR 3211 (a) (7), unanimously reversed, on the law, without costs, and the motion denied.

Since the fifth cause of action (breach of fiduciary duty) is a tort — not a contract — claim, plaintiffs are not required to allege that defendants’ actions were taken in their individual capacity instead of as directors of defendant Sovereign Apartments, Inc. (SAI) (see Fletcher v Dakota, Inc., 99 AD3d 43, 49 [1st Dept 2012]). Contrary to defendants’ contention, plaintiffs’ breach of fiduciary duty claim is not a breach of contract claim in disguise. Unlike Brasseur v Speranza (21 AD3d 297 [1st Dept 2005]), on which defendants rely, the complaint in the instant action alleges that individual board members “breached a duty other than, and independent of, those contractually imposed upon the board” {id. at 298). In particular, it alleges that defendants interfered with plaintiff John Gochberg’s contract with nonparty EMSL Analytical Inc. by surreptitiously inducing EMSL to send to the board, rather than Mr. Gochberg, the results of the testing for which Mr. Gochberg had contracted. Such interference, if proven, would constitute a tortious act of affirmative malfeasance for which a board member, if proven personally to have committed it or to have caused its commission, would be subject to personal liability. Further, whether the business judgment rule protects defendants’ actions cannot be determined as a matter of law on the pleadings since defendants’ alleged action in going behind Mr. Gochberg’s back to have EMSL’s analysis delivered to SAI instead of Mr. Gochberg smacks of bad faith (Ackerman v 305 E. 40th Owners Corp., 189 AD2d 665, 667 [1st Dept 1993]).

Concur — Friedman, J.P., Sweeny, Andrias, Saxe and Kapnick, JJ.

Cite This Page — Counsel Stack

Bluebook (online)

119 A.D.3d 431, 988 N.Y.S.2d 489, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gochberg-v-sovereign-apartments-inc-nyappdiv-2014.

Opinion

Related

Cite This Page — Counsel Stack