Success, LLC v. Stonehenge Capital Co.

Feb 10, 2011
Versions:

SUCCESS, LLC, et al., Respondents, v STONEHENGE CAPITAL COMPANY, LLC, et al., Appellants, et al., Defendants. [916 NYS2d 584]—

Order, Supreme Court, New York County (Martin Shulman, J.), entered February 23, 2010, which, to the extent appealed from, denied defendants-appellants’ motions for summary judgment dismissing the fraud-based causes of action as against them and granted plaintiffs’ cross motion for summary judgment solely to the extent that defendant Stonehenge is liable for the misrepresentations of defendant Keller, unanimously affirmed, with costs.

The fraud-based causes of action, which were stated with sufficient particularity (see CPLR 3016 [b]), were properly allowed to proceed. Unlike the breach of contract claims that the motion court dismissed, the fraud claims are not based upon misrepresentations about the funding of plaintiffs’ film project. Rather, the fraud claims are based upon a misrepresentation of then-present facts, e.g., that the budget for the film had actually been approved and that all conditions precedent had been met. Such misrepresentations are collateral to the contract, as they involve a breach of duty separate from a breach of contract (see First Bank of Ams. v Motor Car Funding, 257 AD2d 287, 291-292 [1999]).

The court‘s misstatement of fact in its order, namely, that a particular memorandum entitled “Success Film Financing Package” had been circulated to defendant Stonehenge, does not affect our determination.

We have considered appellants’ remaining contentions and find them unavailing. Concur—Gonzalez, P.J., Tom, Andrias, Acosta and Abdus-Salaam, JJ. [Prior Case History: 2010 NY Slip Op 30444(U).]