WIT Holding Corp. v. Klein

Decision Date09 April 2001
Citation282 A.D.2d 527,724 N.Y.S.2d 66
Parties(A.D. 2 Dept. 2001) WIT Holding Corp., respondent, v Kenneth Klein, et al., appellants, et al., defendants. 2000-02273 : SECOND JUDICIAL DEPARTMENT
CourtNew York Supreme Court — Appellate Division

Hoffman Pollok & Pickholz, LLP, New York, N.Y. (Marvin G. Pickholz and William A. Rome of counsel), for appellants.

Scott M. Zucker, Lake Success, N.Y. (Andrew B. Schultz of counsel), for respondent.

CORNELIUS J. O'BRIEN, J.P., SONDRA MILLER, WILLIAM D. FRIEDMANN, ROBERT W. SCHMIDT, JJ.

In an action, inter alia, to recover damages for fraud, the defendants Kenneth Klein, Paul Wasserman, First Providence Financial Group, Inc., First Providence Financial Group, LLC, and Madison Avenue Associates, LLC, appeal from so much of an order of the Supreme Court, Suffolk County (Gerard, J.), dated January 24, 2000, as denied those branches of their motion which were to dismiss the first, third, fourth, fifth, sixth, and seventh causes of action in the complaint insofar as asserted against them.

ORDERED that the order is modified, on the law, by deleting the provisions thereof denying the branches of the motion which were to dismiss the third, fourth, and fifth causes of action insofar as asserted against the appellants and substituting therefor a provision granting those branches of the motion; as so modified, the order is affirmed insofar as appealed from, without costs or disbursements.

This action arises out of an agreement by the plaintiff to purchase a stock interest in First Providence Financial Group, Inc. (hereinafter FPFG). The plaintiff allegedly paid $500,000 to FPFG and no stock was ever transferred to it. The plaintiff alleges, inter alia, that the defendant Kenneth Klein, in order to benefit himself and the defendants FPFG, Paul Wasserman, and Madison Avenue Associates, LLC, fraudulently induced it to enter into the agreement.

A cause of action alleging fraud does not lie where the only fraud claim relates to a breach of contract (see, Non - Linear Trading Co. v Braddis Assocs., 243 A.D.2d 107; Gordon v De Laurentiis Corp., 141 A.D.2d 435). A present intent to deceive must be alleged and a mere misrepresentation of an intention to perform under the contract is insufficient to allege fraud (see, Non-Linear Trading Co. v Braddis Assocs., supra, at 118). Conversely, a misrepresentation of material fact, which is collateral to the contract and serves as an inducement for the contract, is sufficient to sustain a cause of action alleging fraud (see, Deerfield Communications Corp. v Cheesebrough-Ponds Inc., 68 N.Y.2d 954; First Bank of the Ams. v Motor Car Funding, 257 A.D.2d 287).

The plaintiff alleges that, during discussions with the plaintiff's president, Michael Weiner, and its treasurer, Kevin Held, Klein made misrepresentations of fact to induce it to enter into an agreement with FPFG. According to the plaintiff, Klein told these representatives that he was a principal shareholder in FPFG when he still owed money to a third person for the purchase of that shareholder interest. Klein also allegedly stated that FPFG was in full compliance with...

To continue reading

Request your trial
4 cases
  • Greenstone/Fontana Corp. v. Feldstein, 2008 NY Slip Op 51387(U) (N.Y. Sup. Ct. 6/23/2008)
    • United States
    • New York Supreme Court
    • 23 Junio 2008
    ...a cause of action alleging fraud." Selinger Enterprises, Inc. v. Cassuto, 50 AD3d 766 (2d Dept. 2008) citing WIT Holding Corp. v. Klein, 282 AD2d 527, 528 (2d Dept. 2001); Tiffany at Westbury Condominium v. Marelli Dev. Corp., 40 AD3d 1073, 1076 (2d Dept. By way of their first and second co......
  • WIT Holding Corp. v. Klein
    • United States
    • New York Supreme Court — Appellate Division
    • 9 Abril 2001
  • Japna, Inc. v. Selfx Innovations Inc.
    • United States
    • U.S. District Court — Southern District of New York
    • 22 Marzo 2024
    ...bestowed of heightened trust with JAPNA” due to her position as a high-level designer. FAC at ¶¶ 144-145. See also WIT Holding Corp. v. Klein, 282 A.D.2d at 529. Ortiz allegedly breached her fiduciary duty to JAPNA conspiring with Tulip Defendants to disclose JAPNA's Trade Secrets, the Work......
  • Newgarden v. Havemeyer Estates LLC
    • United States
    • New York Supreme Court
    • 21 Noviembre 2024
    ...of an intention to perform duties arising under a contract is insufficient to allege a viable fraud cause of action (WIT Holding, 282 A.D.2d at 528; Non-Linear Trading Co. v Braddis Assoc., 243 107,118 [1st Dept 1998]). That plaintiffs' fraud allegations involve duties to be performed under......
3 books & journal articles
  • Chapter 32 GENERAL AND SPECIFIC MERGERS CLAUSES
    • United States
    • New York State Bar Association Contract Doctrine and Marital Agreements in New York
    • Invalid date
    ...631, 813 N.Y.S.2d 756 (2d Dep't 2006); Mendelovitz v. Cohen, 37 A.D.3d 670, 830 N.Y.S.2d 577 (2d Dep't 2007); WIT Holding Corp. v. Klein, 282 A.D.2d 527, 724 N.Y.S.2d 66 (2d Dep't 2001); Harges v. Harges, 46 Misc. 2d 994, 261 N.Y.S.2d 713 (Sup. Ct., Nassau Co. 1965).[5580] Sabo, 3 N.Y.2d 15......
  • Chapter 25 FIDUCIARY RELATIONSHIPS AMONG SPOUSES AND AFFIANCED COUPLES
    • United States
    • New York State Bar Association Contract Doctrine and Marital Agreements in New York
    • Invalid date
    ...432 (2012); Restatement (Second) Torts § 874; Black's Law Dictionary (9th ed. 2009), fiduciary.[3654] WIT Holding Corp. v. Klein, 282 A.D.2d 527, 724 N.Y.S.2d 66 (2d Dep't 2001).[3655] Braddock v. Braddock, 60 A.D.3d 84, 89, 871 N.Y.S.2d 68 (1st Dep't 2009) (quoting Wende C. v. United Metho......
  • Chapter 28 RESCISSION
    • United States
    • New York State Bar Association Contract Doctrine and Marital Agreements in New York
    • Invalid date
    ...696, 652 N.Y.S.2d 350 (1997).[4582] Ross v. DeLorenzo, 28 A.D.3d 631, 813 N.Y.S.2d 756 (2d Dep't 2006); WIT Holding Corp. v. Klein, 282 A.D.2d 527, 724 N.Y.S.2d 66 (2d Dep't 2001); Deerfield Commc'ns Corp. v. Chesebrough-Ponds, Inc., 68 N.Y.2d 954, 510 N.Y.S.2d 88 (1986); Non-Linear Trading......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT