McMAHAN COMPANY v. L. Peter Byler, et al., Defendants. (1998)

Order, Supreme Court, New York County (Charles Ramos, J.), entered October 17, 1997, which, to the extent appealed from as limited by plaintiffs' brief, denied plaintiffs' motion to dismiss defendants-respondents' first counterclaim as barred by the doctrine of res judicata, unanimously affirmed, with costs.

Given that an overarching concern in applying the doctrine of res judicata is for fairness (see, Matter of Hodes v. Axelrod, 70 N.Y.2d 364, 374, 520 N.Y.S.2d 933, 515 N.E.2d 612), we find that the issues posed by the instant litigation, as limited by the prior decision of this Court (see, McMahan & Co. v. Bass, 250 A.D.2d 460, 673 N.Y.S.2d 19) and by those portions of the instant order not challenged on appeal, and the issues presented in the relevant prior Federal litigation (see, Toto v. McMahan, Brafman, Morgan & Co., 1995 U.S. Dist LEXIS 1399), are not so closely related in time, space, motivation, or origin, that treating them as a unit would have been convenient for trial and would have conformed to the parties' expectations (cf., Schwartzreich v. E.P.C. Carting Co., 246 A.D.2d 439, 668 N.Y.S.2d 370).  The Federal action concerned fraudulent inducement to enter into the limited partnership and subsequent repurchase contracts, whereas this action is now focused on the alleged breach of a duty to make a single payment under the second contract (see, Finkelstein v. Ilan, 239 A.D.2d 545, 546, 658 N.Y.S.2d 78).

MEMORANDUM DECISION.