COPPOLA v. APPLIED ELECTRIC CORP (2001)

Order, Supreme Court, New York County (Beatrice Shainswit, J.), entered July 11, 2000, which, to the extent appealed from as limited by the brief, granted that branch of defendants' motion pursuant to CPLR 3211 seeking dismissal of plaintiff's cause of action for fraud for failure to state a cause of action, unanimously affirmed, without costs.

 Plaintiff's fraud claim, based on the allegation that defendant Herman harbored the undisclosed intention from the outset to never comply with the parties' stock purchase agreement, was properly dismissed as merely duplicative of his breach of contract cause of action.   Assuming the truth of plaintiff's allegations and according him every possible favorable inference to determine only whether the facts alleged fit within any cognizable legal theory (Leon v. Martinez, 84 N.Y.2d 83, 87-88, 614 N.Y.S.2d 972, 638 N.E.2d 511;  Batas v. Prudential Ins. Co. of Am., 281 A.D.2d 260, 724 N.Y.S.2d 3), it is clear that the claimed fraud was not collateral or extraneous to the contract (see, Glanzer v. Keilin & Bloom LLC, 281 A.D.2d 371, 722 N.Y.S.2d 540;  First Bank of the Americas v. Motor Car Funding, Inc., 257 A.D.2d 287, 291-292, 690 N.Y.S.2d 17;  J.E. Morgan Knitting Mills, Inc. v. Reeves Bros., Inc., 243 A.D.2d 422, 663 N.Y.S.2d 211), did not allege any damages, including those for foregone opportunities, that would not be recoverable under a contract measure of damages (see, Makastchian v. Oxford Health Plans, Inc., 270 A.D.2d 25, 27, 704 N.Y.S.2d 44;  J.E. Morgan Knitting Mills, Inc. v. Reeves Bros, Inc., supra ) and failed to plead a breach of duty separate from a breach of the contract (see, New York Univ. v. Cont. Ins. Co., 87 N.Y.2d 308, 316, 639 N.Y.S.2d 283, 662 N.E.2d 763;  First Bank of the Americas v. Motor Car Funding, Inc., supra;  Non-Linear Trading Co., Inc. v. Braddis Assocs., Inc., 243 A.D.2d 107, 118-119, 675 N.Y.S.2d 5).

Contrary to plaintiff's argument, the alleged fraud in Graubard Mollen Dannett & Horowitz v. Moskovitz, 86 N.Y.2d 112, 629 N.Y.S.2d 1009, 653 N.E.2d 1179 was collateral or extraneous to the breach of contract claim (see, Big Apple Car, Inc. v. City of New York, 234 A.D.2d 136, 138, 650 N.Y.S.2d 730).   The alleged undisclosed fraudulent intent in Graubard related to an additional oral assurance not embodied in the terms of the agreement that was allegedly breached, and such intent was not asserted in conclusory fashion but was evidenced by defendant's conduct shortly after entering into the agreement.

 Finally, with respect to the additional claim that defendants failed to disclose that Applied was operating with substantial debt, which claim was set forth, not in plaintiff's pleadings or in any accompanying affidavit but only in his attorney's memorandum of law in opposition, the IAS court aptly noted that plaintiff had failed to state either how any such omission affected his decision to enter into the agreement with defendants or how it was a proximate cause of any claimed loss.