GELMAC QUALITY FEEDS INC v. RONNING (2005)

 In August 1993, plaintiff contracted with defendants to design and construct an animal feed manufacturing plant.   Plaintiff had continual problems with both the design of the plant and the equipment supplied by defendants, and within weeks after becoming operational the plant was shut down by the New York State Department of Environmental Conservation (DEC) for failure to comply with applicable regulations.   Plaintiff retained another engineer after affording defendants the opportunity to comply with the DEC regulations, and the plant became operational again in December 1994.   In July 1999, plaintiff commenced this action against defendants for breach of contract and, in February 2003, plaintiff moved for leave to amend the complaint by adding a second cause of action against defendant Richard L. Ronning for fraudulent inducement.   The proposed amendment patently lacks merit (see generally McFarland v. Michel, 2 A.D.3d 1297, 1300, 770 N.Y.S.2d 544;  MS Partnership v. Wal-Mart Stores, 2 A.D.3d 1482, 1485, 770 N.Y.S.2d 514), and thus we conclude that Supreme Court did not abuse its discretion in denying plaintiff's motion (see generally CPLR 3025[b];  Edenwald Contr. Co. v. City of New York, 60 N.Y.2d 957, 959, 471 N.Y.S.2d 55, 459 N.E.2d 164).   It is well settled that a necessary element of a cause of action for fraudulent inducement is detrimental reliance on a material representation known to be false (see New York Univ. v. Continental Ins. Co., 87 N.Y.2d 308, 318, 639 N.Y.S.2d 283, 662 N.E.2d 763;  Merrill Lynch, Pierce, Fenner & Smith v. Wise Metals Group, 19 A.D.3d 273, 275, 798 N.Y.S.2d 14), and plaintiff herein failed to plead detrimental reliance (see Dos v. Scelsa & Villacara, 200 A.D.2d 705, 707, 607 N.Y.S.2d 68, lv. denied 84 N.Y.2d 840, 617 N.Y.S.2d 129, 641 N.E.2d 149;  see also Knight Secs. v. Fiduciary Trust Co., 5 A.D.3d 172, 173, 774 N.Y.S.2d 488;  Walters v. Pennon Assoc., 188 A.D.2d 596, 591 N.Y.S.2d 74).   In any event, we further conclude that the proposed cause of action is time-barred because the alleged fraudulent inducement occurred more than six years before plaintiff sought leave to amend the complaint and more than two years after plaintiff had all the necessary facts to have discovered the alleged fraud with the exercise of reasonable diligence (see Rattner v. York, 174 A.D.2d 718, 721, 571 N.Y.S.2d 762;  see also Hellman v. Hoenig & Co., 244 A.D.2d 529, 665 N.Y.S.2d 581, lv. denied 92 N.Y.2d 814, 681 N.Y.S.2d 475, 704 N.E.2d 228;  cf. Rice v. Heilbronner, 272 A.D.2d 957, 708 N.Y.S.2d 684;  see generally CPLR 213[8];  Trepuk v. Frank, 44 N.Y.2d 723, 724-725, 405 N.Y.S.2d 452, 376 N.E.2d 924).

 The court erred, however, in denying that part of defendants' cross motion seeking dismissal of the first cause of action insofar as it was asserted against defendant Ronning Engineering Company, Inc., and thus should have dismissed the complaint in its entirety.   We agree with defendants that the first cause of action is “essentially a malpractice claim ․ couched in breach of contract terms in order to benefit from the six-year statute of limitations” (Matter of R.M. Kliment & Frances Halsband, Architects [McKinsey & Co.], 3 N.Y.3d 538, 543, 788 N.Y.S.2d 648, 821 N.E.2d 952).   The malpractice action accrued “upon completion of performance, when the ․ professional relationship with plaintiff end[ed]” (County of Rockland v. Kaeyer, Garment & Davidson Architects, 309 A.D.2d 891, 891, 766 N.Y.S.2d 359;  see Parsons Brinckerhoff Quade & Douglas v. EnergyPro Constr. Partners, 271 A.D.2d 233, 234, 707 N.Y.S.2d 30;  see also Barbieri v. Shayne, Dachs, Stanisi, Corker & Sauer, 304 A.D.2d 512, 757 N.Y.S.2d 583).   Although the precise date on which the parties' relationship ended is not clear from the record, the record establishes that the relationship ended during the year 1994.   The instant action was commenced in July 1999, well beyond the three-year statute of limitations period of CPLR 214(6), and thus the first cause of action is time-barred.   We therefore modify the order accordingly.

It is hereby ORDERED that the order so appealed from be and the same hereby is unanimously modified on the law by granting the cross motion in its entirety and dismissing the complaint and as modified the order is affirmed without costs.

MEMORANDUM: