Parekh v. Cain

• Decision Date: 13 June 2012
• Citation: 96 A.D.3d 812,2012 N.Y. Slip Op. 04725,948 N.Y.S.2d 72
• Parties: Nikhlesh PAREKH, appellant, v. Niall CAIN, et al., respondents.
• Court: New York Supreme Court — Appellate Division

96 A.D.3d 812

948 N.Y.S.2d 72

2012 N.Y. Slip Op. 04725

Nikhlesh PAREKH, appellant,

v.Niall CAIN, et al., respondents.

Supreme Court, Appellate Division, Second Department, New York.

June 13, 2012.

Michael H. Joseph, PLLC, White Plains, N.Y., for appellant.

Lyons McGovern LLP, White Plains, N.Y. (Kyle C. McGovern and Diane B. Cavanaugh of counsel), for respondents Niall Cain, Cynthia Caracta, and Orissa DF, LLC.

Housman & Associates, P.C., Tarrytown, N.Y. (Brian J. Divney of counsel), for respondent Joseph Locascio, Jr.

REINALDO E. RIVERA, J.P., RANDALL T. ENG, PLUMMER E. LOTT, and SANDRA L. SGROI, JJ.

In an action, inter alia, to recover damages for fraud, breach of contract, breach of fiduciary duty, trademark infringement, unfair competition, conversion, and tortious interference with business relations, the plaintiff appeals (1), as limited by his brief, from so much of an order of the Supreme Court, Westchester County (Bellantoni, J.), entered December 2, 2010, as granted those branches of the motion of the defendants Niall Cain, Cynthia Caracta, and Orissa DF, LLC, which were pursuant to CPLR 3211(a)(1) to dismiss the first, third, ninth, tenth, twelfth, and thirteenth causes of action insofar as asserted against those defendants based upon documentary evidence, and pursuant to CPLR 3211(a)(7) to dismiss the fourth, seventh, eighth, and eleventh causes of action insofar as asserted against those defendants for failure to state a cause of action, and (2) from an order of the same court (Lefkowitz, J.), entered December 14, 2010, which granted the motion of the defendant Joseph Locascio, Jr., pursuant to CPLR 3211(a)(1) and (7) to dismiss the complaint insofar as asserted against him.

ORDERED that the order entered December 2, 2010, is modified, on the law, (1) by deleting the provisions thereof granting those branches of the motion of the defendants Niall Cain, Cynthia Caracta, and Orissa DF, LLC, which were pursuant to CPLR 3211(a)(1) to dismiss the first, third, ninth, tenth, twelfth, and thirteenth causes of action insofar as asserted against them, and substituting therefor provisions denying those branches of the motion, and (2) by deleting the provision thereof granting that branch of the motion of the defendants Niall Cain, Cynthia Caracta, and Orissa DF, LLC, which was pursuant to CPLR 3211(a)(7) to dismiss so much of the eighth cause of action as alleged unfair competition, and substituting therefor a provision denying that branch of the motion; as so modified, the order entered December 2, 2010, is affirmed insofar as appealed from, without costs or disbursements; and it is further,

ORDERED that the order entered December 14, 2010, is modified, on the law, by deleting the provision thereof granting that branch of the motion of the defendant Joseph Locascio, Jr., which was pursuant to CPLR 3211(a)(1) to dismiss the complaint insofar as asserted against him, and substituting therefor a provision denying that branch of the motion; as so modified, the order entered December 14, 2010, is affirmed insofar as appealed from, without costs or disbursements.

The complaint alleged that the plaintiff, Nikhlesh Parekh, operated an Indian restaurant named Orissa in Dobbs Ferry. In December 2007 the plaintiff considered expanding his business and sought out investors. The defendants Niall Cain and Cynthia Caracta allegedly orally agreed with the plaintiff (hereinafter the oral agreement) that they would all form a joint venture to open an Indian restaurant and boutique in Dobbs Ferry (hereinafter the restaurant). The plaintiff's interest in the restaurant would start at only one percent, but as he paid off a business loan using the restaurant's profits, his ownership interest would increase until it reached 49 percent. The plaintiff did most of the work to establish the restaurant, and closed his existing restaurant in August 2008.

On February 25, 2009, Cain and Caracta formed the defendant Orissa DF, LLC (hereinafter Orissa DF), to own the restaurant. The plaintiff alleged that he was a member and manager of Orissa DF. The complaint alleges, inter alia, that Cain, Caracta, and Orissa DF (hereinafter collectively the Orissa defendants) breached the oral agreement by locking the plaintiff out of the business in January 2010. The complaint also alleged that the defendant Joseph Locascio, Jr., had an attorney-client relationship with the plaintiff, and that Locascio violated his fiduciary duty to the plaintiff.

The Orissa defendants moved, inter alia, pursuant to CPLR 3211(a)(1) and (7) to dismiss the complaint insofar as asserted against them. In support of the motion, they submitted, among other things, the purported operating agreement for Orissa DF, which listed only Cain and Caracta as members. In opposition, the plaintiff submitted, inter alia, e-mails from Cain and Caracta, which were sent months after the purported operating agreement was signed, and which indicated that no agreement had yet been signed, and that Cain and Caracta intended the plaintiff to be a partner in the business. Locascio also moved pursuant to CPLR 3211(a)(1) and (7) to dismiss the complaint insofar as asserted against him on the ground, inter alia, that the plaintiff failed to properly allege the existence of an attorney-client relationship.

In an order entered December 2, 2010, the Supreme Court determined that the plaintiff had sufficiently pleaded a cause of action alleging unjust enrichment, but granted those branches of the Orissa defendants' motion which were to dismiss the remainder of the complaint insofar as asserted against them. In an order entered December 14, 2010, the Supreme Court granted Locascio's motion to dismiss the complaint insofar as asserted against him.

To prevail on a motion to dismiss pursuant to CPLR 3211(a)(1), the documentary evidence which forms the basis of the defense must be such that it resolves all factual issues as a matter of law, and conclusively disposes of the plaintiff's claim ( see Goshen v. Mutual Life Ins. Co. of N.Y., 98 N.Y.2d 314, 326, 746 N.Y.S.2d 858, 774 N.E.2d 1190;Jesmer v. Retail Magic, Inc., 55 A.D.3d 171, 180, 863 N.Y.S.2d 737;Prudential Wykagyl/Rittenberg Realty v. Calabria–Maher, 1 A.D.3d 422, 766 N.Y.S.2d 885). “[T]o be considered ‘documentary,’ evidence must be unambiguous and of undisputed authenticity” ( Fontanetta v. John Doe 1, 73 A.D.3d 78, 86, 898 N.Y.S.2d 569).

Here, the Supreme Court erred in granting those branches of the Orissa defendants' motion which were pursuant to CPLR 3211(a)(1) to dismiss the causes of action alleging breach of contract (first cause of action) and breach of fiduciary duty (third cause of action), as well as the causes of action seeking a judicial dissolution, an accounting, a receivership, and liquidation (the ninth, tenth, twelfth, and thirteenth causes of action, respectively) insofar as asserted against them on the ground that the purported operating agreement constituted documentary evidence that conclusively disposed of the plaintiff's claims. “Dismissal under CPLR 3211(a)(1) is warranted ‘only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law’ ” ( 511 W. 232nd Owners Corp. v. Jennifer Realty Co., 98 N.Y.2d 144, 152, 746 N.Y.S.2d 131, 773 N.E.2d 496, quoting Leon v. Martinez, 84 N.Y.2d 83, 88, 614 N.Y.S.2d 972, 638 N.E.2d 511). Here, there are disputed issues relating to the authenticity of the operating agreement. Accordingly, dismissal of these causes of action insofar as asserted against the Orissa defendants was not warranted pursuant to CPLR 3211(a)(1) ( see Berenthal & Assoc. v. Mechanical Plastics Corp., 288 A.D.2d 143, 733 N.Y.S.2d 347;Paynter v. Vishnia, 114 A.D.2d 404, 494 N.Y.S.2d 44;see generally Kurtzman v. Bergstol, 40 A.D.3d 588, 590, 835 N.Y.S.2d 644;Limited Liability Company Law § 702; ...