Commercial Division Blog
Posted: December 16, 2018 / Categories Commercial, Fraud/Misrepresentation
Disclaimers of Representations Not Specific Enough to Bar Fraud Claim
On November 19, 2018, Justice Ramos of the New York County Commercial Division issued a decision in Spicer v. Gardaworld Consulting (UK) Ltd., 2018 NY Slip Op. 33088(U), holding that an agreement's disclaimers were not specific enough to bar a fraud claim, explaining:
To state a claim for fraud, a plaintiff must allege with specificity the intentional misrepresentation of a material fact, justifiable reliance thereon and damages. With respect to reliance, a buyer's disclaimer of reliance generally precludes its justifiable reliance on the seller's misrepresentations or omissions where the disclaimer is sufficiently specific to the particular type of fact misrepresented or disclosed, and the alleged misrepresentation or omissions did not concern facts peculiarly within the seller's knowledge. Thus, where a written contract contains a specific disclaimer as to a specific matter, a plaintiff is precluded from later claiming fraud on the ground of a prior misrepresentation as to the specific matter.
The Court concludes that the contractual disclaimers of reliance by Garda set forth in the SPA do not come close to satisfying the specificity standard articulated by the Court of Appeals. The disclaimers contained in the SPA do not sufficiently track the particular omissions and representations alleged by Garda.
(Internal citations omitted).
Commercial litigation frequently involves fraud-based claims. Such claims have special pleading requirements or rules. Contact Schlam Stone & Dolan partner John Lundin at email@example.com if you or a client think you have been defrauded, or if someone has accused you or a client of defrauding them.