Melcher v. Apollo Medical Fund Management L.L.C.

• Decision Date: 24 January 2006
• Docket Number: 7658N.,7657.
• Citation: 25 A.D.3d 482,808 N.Y.S.2d 207,2006 NY Slip Op 00393
• Parties: JAMES L. MELCHER, Appellant-Respondent, v. APOLLO MEDICAL FUND MANAGEMENT L.L.C. et al., Respondents-Appellants. JAMES L. MELCHER, Respondent, v. APOLLO MEDICAL FUND MANAGEMENT L.L.C. et al., Appellants.
• Court: New York Supreme Court — Appellate Division

25 A.D.3d 482

808 N.Y.S.2d 207

2006 NY Slip Op 00393

JAMES L. MELCHER, Appellant-Respondent, v. APOLLO MEDICAL FUND MANAGEMENT L.L.C. et al., Respondents-Appellants.

JAMES L. MELCHER, Respondent, v. APOLLO MEDICAL FUND MANAGEMENT L.L.C. et al., Appellants.

7657.

7658N.

Appellate Division of the Supreme Court of the State of New York, First Department.

January 24, 2006.

Order, Supreme Court, New York County (Herman Cahn, J.), entered September 14, 2004, which, inter alia, granted defendants' motion to dismiss the action to the extent of dismissing the cause of action for conversion, and denied the motion with respect to the causes of action for breach of contract, breach of fiduciary duty, and declaratory relief involving plaintiff's right to reinstatement as a manager and member of defendant limited liability company (the Company) and defendant Fradd's right to indemnification from the Company, unanimously affirmed, without costs. Order, same court and Justice, entered August 31, 2005, which denied defendants' motion for a default judgment on their counterclaim for breach of contract and granted plaintiff's cross motion for leave to serve a late reply, unanimously affirmed, without costs.

Concerning plaintiff's appeal from the first order, the conversion cause of action was properly dismissed as duplicative of the contract cause of action (see Richbell Info. Servs. v Jupiter Partners, 309 AD2d 288, 306 [2003]). In view of the foregoing, it is unnecessary to address whether the conversion claim was otherwise sufficiently stated.

Concerning defendants' appeal from the first order, the motion court correctly rejected, at this pleading stage, defendants' factual contention that plaintiff waived his claim for breach of contract because he should have known from examining the monthly spreadsheets he was provided that the profit split was not as he thought. The knowledge element of waiver (see Nassau Trust Co. v Montrose Concrete Prods. Corp., 56 NY2d 175, 184 [1982]) is not conclusively established (see Leon v Martinez, 84 NY2d 83, 88 [1994]) by the spreadsheets, which do not disclose the formula employed to calculate the allocations and contain no explanatory footnotes. Defendants' claim of estoppel (see Nassau Trust Co., 56 NY2d at 184) is similarly inconclusive, since Fradd's profits were higher during the period of the claimed estoppel, and his assertion that he would have hired someone more efficient to replace plaintiff had plaintiff not continued to accept his allocated share merely raises an issue of fact not susceptible to resolution at this juncture. The shorter Delaware limitations period (Del Code Ann, tit 10, § 8106) was not imported by virtue of the choice of law clause, which, by its terms, required the application of that state's substantive contract law principles but otherwise left the procedural rules of this state to govern (see Sears, Roebuck & Co. v Enco Assoc., 43 NY2d 389, 397 [1977]). As amplified by plaintiff's opposition papers, the complaint adequately pleads that his removal as a member of the Company was in violation of the parties' agreement. Although the signed...