Lavern McKenzie, et al., respondents-appellants, v. Kim Champion, et al., appellants-Respondents, et al., defendants. (2026)

Argued—January 20, 2026

DECISION & ORDER

In an action, inter alia, to recover damages for fraud, the defendants Kim Champion, Rachel Belizaire, and Kareful and Karefree Training School in New York City, Inc., appeal, and the plaintiffs cross-appeal, from an order of the Supreme Court, Rockland County (Keith J. Cornell, J.), dated April 4, 2024.  The order, insofar as appealed from, denied those branches of those defendants' motion which were pursuant to CPLR 3211(a) to dismiss the first, second, and fourth causes of action insofar as asserted against them.  The order, insofar as cross-appealed from, granted that branch of those defendants' motion which was pursuant to CPLR 3211(a) to dismiss the third cause of action insofar as asserted against them.

ORDERED that the cross-appeal is dismissed as abandoned;  and it is further,

ORDERED that the order is affirmed insofar as appealed from;  and it is further,

ORDERED that one bill of costs is awarded to the plaintiffs.

The plaintiffs commenced this action against, among others, the defendants Kareful and Karefree Training School in New York City, Inc. (hereinafter Karefree), Kim Champion, the principal and owner of Karefree, and Rachel Belizaire, who allegedly posed as a manager of Karefree (hereinafter collectively the defendants), to recover damages for fraud, aiding and abetting fraud, violation of 18 USC § 1962, and unjust enrichment.

The plaintiffs alleged that Champion knowingly “devised a scheme” to run a fraudulent 15–month nursing program through Karefree, for which Champion charged each plaintiff more than $26,000 in tuition.  The defendants allegedly misrepresented to the plaintiffs that Karefree was accredited through a Florida university and that completion of the Karefree program would qualify the plaintiffs to take the New York State nursing licensing examinations and become registered nurses.

The defendants moved pursuant to CPLR 3211(a) to dismiss the complaint insofar as asserted against them.  In an order dated April 4, 2024, the Supreme Court granted that branch of the defendants' motion which was to dismiss the third cause of action insofar as asserted against them and denied those branches of the defendants' motion which were to dismiss the first, second, and fourth causes of action insofar as asserted against them.  The defendants appeal, and the plaintiffs cross-appeal.

As a preliminary matter, because the plaintiffs' brief does not seek reversal or modification of the portion of the order directing dismissal of the third cause of action insofar as asserted against the defendants, the plaintiffs' cross-appeal must be dismissed as abandoned (see Sanchez v. Rivera, 171 AD3d 965, 966).

“To succeed on a motion to dismiss based upon documentary evidence pursuant to CPLR 3211(a)(1), the documentary evidence must utterly refute the plaintiff's factual allegations, conclusively establishing a defense as a matter of law” (Gould v. Decolator, 121 AD3d 845, 847;  see Goshen v Mutual Life Ins. Co. of N.Y., 98 N.Y.2d 314, 326).  “[C]ontracts may qualify as documentary evidence within the meaning of CPLR 3211(a)(1)” (McDonald v. O'Connor, 189 AD3d 1208, 1210).  Here, however, the enrollment agreements submitted by the defendants in support of their motion did not utterly refute the plaintiffs' factual allegations (see Saadia v National Socy. of Hebrew Day Schs., Inc., 225 AD3d 806, 808;  Truesource, LLC v. Niemeyer, 223 AD3d 694, 695).

Contrary to the defendants' contention, while “the existence of a valid and enforceable contract governing a particular subject matter precludes recovery in quasi-contract on a theory of unjust enrichment for events arising out of the same subject matter” (Incorporated Vil. of Freeport v Albrecht, Viggiano, Zurich & Co., P.C., 226 AD3d 658, 661), the plaintiffs adequately alleged that the enrollment agreements are unenforceable (see Kovalenko v Bhatti Gen. Contr.   & Dev., LLC, 241 AD3d 1540, 1543;  Computer Assoc.  Intl., Inc. v U.S. Balloon Mfg. Co., Inc., 10 AD3d 699, 700).

Accordingly, the Supreme Court properly denied those branches of the defendants' motion which were pursuant to CPLR 3211(a) to dismiss the first, second, and fourth causes of action insofar as asserted against them.

The defendants' remaining contentions are improperly raised for the first time on appeal or in their reply brief.

DUFFY, J.P., CHRISTOPHER, WARHIT and GOLDBERG VELAZQUEZ, JJ., concur.

ENTER:

Darrell M. Joseph

Clerk of the Court