Meltzer v. G.B.G., Inc.

• Decision Date: 31 October 1991
• Citation: 176 A.D.2d 687,575 N.Y.S.2d 485
• Parties: Marvin H. MELTZER, et al., Plaintiffs-Respondents, v. G.B.G., INC., etc., et al., Defendants-Appellants. Marvin H. MELTZER, et al., Plaintiffs-Appellants, v. G.B.G., INC., etc., et al., Defendants-Respondents.
• Court: New York Supreme Court — Appellate Division

Page 485

575 N.Y.S.2d 485

176 A.D.2d 687

Marvin H. MELTZER, et al., Plaintiffs-Respondents, v. G.B.G., INC., etc., et al., Defendants-Appellants.

Marvin H. MELTZER, et al., Plaintiffs-Appellants, v. G.B.G., INC., etc., et al., Defendants-Respondents.

Supreme Court, Appellate Division First Department.

Oct. 31, 1991.

Before SULLIVAN, J.P., and MILONAS, KUPFERMAN, ASCH and KASSAL, JJ.

MEMORANDUM DECISION.

Calendar Number 7843: Order, Supreme Court, New York County (Beatrice Shainswit, J.), entered July 9, 1990, which granted defendants' motion pursuant to CPLR §§ 3013, 3014, 3024 and 3211(a)(7) to dismiss the first and second causes of action of the plaintiffs' complaint, denied defendants' motion to dismiss the third and fourth causes of action, and which granted, in part, defendants' motion to dismiss the fifth and sixth causes of action of the complaint, unanimously modified, on the law, to the extent of granting the defendants' motion to dismiss the fourth cause of action and the remaining portions of the fifth cause of action, and otherwise affirmed, without costs.

Calendar Number 11139N: Order of the same court and justice, entered March 19 1991, which denied plaintiffs' motion seeking to compel the defendants to accept plaintiffs' proposed amended complaint, or in the alternative, for leave to amend the complaint pursuant to CPLR 3025(b), and to strike the defendants' answer and counterclaims, unanimously affirmed, without costs.

Plaintiffs commenced the underlying action seeking rescission and cancellation of a contract of sale between plaintiff 7 West 37th Street Realty Corp., as purchaser, and defendant G.B.G., Inc., as seller, of certain real property located on City Island, Bronx County. The complaint set forth six causes of action premised upon impossibility of performance; mutual mistake; breach of fiduciary duty by the contract escrow agent, defendant Russ & Russ; anticipatory breach of the sales contract; fraud in the inducement; and breach of a related contractual agreement by defendant G.B.G., Inc., as a contract vendee entitled to purchase the subject property from its present owner, Conjo Realty Corp., by a failure to pay real estate taxes on the subject property.

Defendants thereafter moved to dismiss the complaint as defectively pleaded, and the IAS court granted the motion only to the extent of dismissing the first and second causes of action and portions of the fifth and sixth causes of action. After the service of the defendants' verified answer, and counterclaims, on September 13, 1990, plaintiffs requested and obtained a written stipulation extending the plaintiffs' time to "reply, respond to, or otherwise move as of course or to make any motion with relation to the defendants' counterclaims ..." and thereafter served a proposed amended complaint which was rejected by the defendants as untimely and defective in that it repleaded causes of action previously dismissed by the court. Subsequently, the IAS court denied plaintiffs' motion seeking to compel the defendants to accept the proposed amended complaint, or, in the alternative, for leave to amend the complaint pursuant to CPLR 3025(b), and to strike the defendants' answer and counterclaims.

Upon an examination of the record, we find that the IAS court did not err in denying defendants' motion seeking to dismiss the third cause of action of the original complaint which alleged that defendant Jay E. Russ, and the law firm of Russ & Russ, as the contract escrow agent, had breached their fiduciary duty to the plaintiffs by releasing $150,000 of the downpayment to defendant G.B.G. The contract between the parties contained a rezoning requirement with a release of funds...