HOMESTEAD DEVELOPMENT CORP v. AYRES (1997)

 Supreme Court properly granted that part of plaintiff's motion for summary judgment dismissing the fifth affirmative defense in the answer.   The contention that a complaint fails to state a cause of action is not properly asserted as an affirmative defense (see, Guglielmo v. Roosevelt Hosp. Staff Hous. Co., 222 A.D.2d 403, 635 N.Y.S.2d 42;  Propoco, Inc. v. Birnbaum, 157 A.D.2d 774, 775, 550 N.Y.S.2d 901;  Falk v. MacMasters, 197 App.Div. 357, 362, 188 N.Y.S. 795), and, in any event, the complaint alleges facts constituting a cause of action for breach of contract and seeks specific performance.

 The court erred, however, in granting that part of plaintiff's motion for summary judgment dismissing the first affirmative defense, which alleges fraud in the inducement.   Because the parties' agreement does not contain a merger clause disclaiming reliance on the representation that allegedly induced defendants to enter into the agreement, parol evidence is admissible to establish the fraudulent inducement (cf., Danann Realty Corp. v. Harris, 5 N.Y.2d 317, 320-321, 184 N.Y.S.2d 599, 157 N.E.2d 597;  Schooley v. Mannion, 241 A.D.2d 677, 659 N.Y.S.2d 374).   Plaintiff failed to meet its initial burden to submit evidence concerning the alleged fraudulent inducement that would warrant judgment in its favor as a matter of law (see, Zuckerman v. City of New York, 49 N.Y.2d 557, 562, 427 N.Y.S.2d 595, 404 N.E.2d 718).

Order unanimously modified on the law and as modified affirmed with costs to defendants.

MEMORANDUM: