Commercial Division Blog

Posted: February 5, 2018 / Categories Commercial, Fraud/Misrepresentation

Fraud Claim Prevails; Plaintiff Not Required to Obtain Representations and Warranties From its Agent

On January 30, 2018, the First Department issued a decision in Schulhof v. Jacobs, 2018 NY Slip Op. 00528, granting plaintiff summary judgment on his fraud claim, explaining:

The motion court also correctly granted summary judgment to plaintiff on his fraud claim. The issue of reasonable reliance can be resolved on a summary judgment motion. Further, plaintiff's success as a businessman does not preclude a finding of reliance. Defendant told plaintiff that the buyer of the art wished to remain anonymous, which prevented plaintiff from conducting due diligence by, for example, contacting the buyer. Since defendant had a fiduciary relationship with decedent, plaintiff was not required to obtain the kinds of representations and warranties that defendant suggests in her reply brief.

(Internal citations omitted) (emphasis added).

Commercial litigation frequently involves fraud-based claims. Such claims have special pleading requirements or rules, including the rule that a sophsticated businessperson's reliance on a false statement must be reasonable. Contact Schlam Stone & Dolan partner John Lundin at if you or a client think you have been defrauded, or if someone has accused you or a client of defrauding them.