Affirmative Defenses are Barred by Guaranty's Express Waiver Provision: J. Remora Maintenance LLC v Efromovich
In a January 4, 2012 decision by Justice Fried, the court granted the plaintiff’s motion for summary judgment to enforce a guaranty executed by the defendant in connection with the plaintiff’s sale of its interest in a company to a third party. The court found that because the two express conditions set forth in the guaranty for its enforcement were met, the plaintiff established entitlement to summary judgment as a matter of law. The court then determined that the defendant failed to raise an issue of fact through its affirmative defenses of fraudulent inducement and lack of consideration. Based on the Court of Appeal’s decision in Citibank v Plapinger, the court concluded that an express waiver contained in the guaranty barred the defendant from asserting the substantive defenses. The court rejected the defendant’s argument that the waiver did not apply to the two affirmative defenses at issue because it did not contain the words “absolutely and unconditional”, finding that such language was unnecessary under New York law for a waiver to effectively waive substantive defenses. The court also granted the plaintiff’s motion to dismiss the defendant’s fraudulent inducement counterclaim under CPLR § 3016(b) on the grounds that the circumstances surrounding the alleged fraudulent inducement were not alleged in sufficient detail.
J. Remora Maintenance LLC v Efromovich, Sup Ct New York County, January 4, 2012, Fried, J, Index No. 650943/11
Court Grants Motion to Strike Phrase "Sham Small Group Companies" from Pleading as Gratuitous and Designed to Inflame: AJS Agency, Inc. v Empire HealthChoice, HMO, Inc.
In a March 29, 2011, decision by Justice Driscoll, the court granted in part and denied in part plaintiffs’ motion to dismiss defendant’s third-party summons and counterclaims. Plaintiffs-insurance brokers sued defendant-insurer for wrongful termination under insurance producer agreements between them. Defendant counterclaimed and impleaded a number of additional third-party defendants by way of summons, alleging that plaintiffs and the impleaded parties conspired fraudulently to obtain commissions under the agreements. Plaintiffs argued that defendant’s pleading was improper because the impleaded parties were not directly liable to defendant for the damages plaintiffs were seeking to recover, and because New York law does not recognize a claim for civil conspiracy. The court denied plaintiffs’ motion to dismiss the third-party summons and counterclaims in their entirety because the claims against the impleaded parties alleging an improper insurance scheme sufficiently involved plaintiffs to be asserted against all of them. The court also denied plaintiffs’ motion to dismiss defendant’s counterclaim for conspiracy to commit fraud because it was based on alleged misrepresentations that defendant allegedly relied upon in procuring the insurance policies, and because defendant’s allegations of conspiracy sufficiently connected plaintiffs to the overall scheme. The court, however, granted plaintiffs’ motion to strike the phrase “Sham Small Group Companies” under CPLR 3024 [b] because the word “Sham” was used “gratuitous[ly]” and was “solely designed to inflame the reader or listener.”
AJS Agency, Inc. v Empire HealthChoice, HMO, Inc., Sup Ct, Nassau County, March 29, 2011, Driscoll, J., Index No. 11440/10
