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Current Developments in the Commercial Divisions of the
New York State Courts
Posted: January 13, 2014

Quantum Meruit Claim Dismissed Where Defendant Benefited From, But Did Not Induce, Plaintiff’s Performance

On December 19, 2013, Justice Bransten of the New York County Commercial Division issued a decision in Von Lavrinoff v. Laufer, 2013 NY Slip Op. 33447(U), dismissing a quantum meruit claim against an entity that allegedly benefited from the plaintiff’s services but did not induce plaintiff’s performance.

In Von Lavrinoff, the plaintiff alleged that he and the individual defendant formed a joint venture to prepare and submit a proposal to a public agency to develop a large “observation wheel.” After the plaintiff contributed $90,000 toward the joint venture and worked on the proposal, the individual defendant formed an LLC that submitted the proposal without the plaintiff, cutting him out of the project.

The plaintiff filed suit asserting, inter alia, a claim for quantum meruit against the LLC defendant. The court dismissed the quantum meruit claim, writing:

the fatal flaw in Plaintiffs’ quantum meruit argument is that [the LLC defendant] did not exist at the time the services were performed. The First Department has stated that a quantum meruit claim cannot exist solely because defendants may have profited, in one form or another, from plaintiffs work. Such a broad reading improperly expands the claim [of quantum meruit], absent any contention that defendants induced plaintiff to do the work.

This decision illustrates the limits of even broad equitable claims like quantum meruit. The decision did not leave the plaintiff without any potential remedy against the LLC defendant, however. The court sustained a claim for aiding and abetting a breach fiduciary duty against the LLC defendant.

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