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A PUTATIVE CLASS ACTION SUIT ALLEGING MUSEUM ADMISSION TICKETS FAILED TO DISCLOSE THE FULL PRICE OF THE TICKET PROPERLY SURVIVED A MOTION TO DISMISS; THE “VOLUNTARY PAYMENT DOCTRINE” DID NOT APPLY (SECOND DEPT).
The Second Department, in a full-fledged opinion by Justice Ottley, in a matter of first-impression, affirming the denial of the motion to dismiss, determined plaintiff stated a cause of action for a violation of the Arts and Cultural Affairs Law and had standing to bring a class action suit. The essence of the violation was the purported failure to disclose the full price of a ticket for admission to a museum, which included taxes and fees, prior to the ticket purchase. The cause of action is statutory. The “voluntary payment doctrine” was deemed inapplicable:
Arts and Cultural Affairs Law § 25.07(4) provides that the defendant shall disclose the total cost of the ticket, including ancillary fees, prior to the ticket being selected for purchase and that the “service charge, or any other fee or surcharge to the purchaser” be “disclosed in a clear and conspicuous manner” (id.). Arts and Cultural Affairs Law § 25.33 provides that “any person who has been injured by reason of a violation of this article may bring an action in his or her own name to enjoin such unlawful act, an action to recover his or her actual damages or fifty dollars, whichever is greater, or both such actions. The court may award reasonable attorney’s fees to a prevailing plaintiff.” * * *
The voluntary payment doctrine “bars recovery of payments voluntarily made with full knowledge of the facts, and in the absence of fraud or mistake of material fact or law” … .
… [W]e conclude … the voluntary payment doctrine does not bar the plaintiff’s claims alleging violations of Arts and Cultural Affairs Law § 25.07(4) because such claims are predicated on a lack of full disclosure … . Cammayo v 1AND8, Inc., 2026 NY Slip Op 05762, Second Dept 10-7-26
THERE WAS NO PROOF PLAINTIFFS HAD NOTICE DEFENDANT WAS ACTING AS AN AGENT FOR A LIMITED LIABILITY COMPANY WHEN HE SIGNED THE CONSTRUCTION-LOAN CONTRACT; THE BREACH OF CONTRACT ACTION SHOULD NOT HAVE BEEN DISMISSED (SECOND DEPT).
The Second Department, reversing Supreme Court, determined that defendant, the principal in a limited liability company (LLC), told plaintiffs he was the “owner of the property” at the time the construction-loan contract was signed and did not disclose the loan was for the company (the LLC). Therefore defendant’s argument he was acting as an agent for the LLPC when the contract was signed was rejected:
“An agent who enters into a contract on behalf of a disclosed principal is not personally liable unless there is clear and explicit evidence of the agent’s intention to be personally bound” … . However, “[t]he party claiming, as an affirmative defense to liability for breach of contract, that an agency relationship existed must demonstrate that the agency relationship and the identity of the principal were disclosed” … . “A principal is considered to be ‘disclosed’ if, at the time of a transaction conducted by an agent, the other party to the contract had notice that the agent was acting for the principal and of the principal’s identity” … .
… [T]here was no evidence that the existence of 1719 Hylan, LLC, was disclosed to the plaintiffs at the time of the loan. The plaintiffs’ principal testified that the defendant told her that he was the owner of the property, that there was no discussion that the construction project was on behalf of a company, and that the defendant never told her that the loan was for a company. The defendant presented no evidence to the contrary. Therefore, the defendant failed to meet his burden of demonstrating that the plaintiffs knew that he was acting on behalf of 1719 Hylan, LLC. 710 E Elizabeth Ave, LLC v Jhong Kim, 2026 NY Slip Op 05756, Second Department 10-7-26
Practice Point: In this breach of contract action, defendant argued he signed the contract as an agent for a limited liability company and was not personally liable. But defendant did not submit any proof the plaintiff was given notice he was signing as an agent for a company. Therefore the agency defense was rejected.
DEFENDANT REAR DRIVER PROVIDED A NONNEGLIGENT EXPLANATION FOR THE REAR-END COLLISION PRECLUDING SUMMARY JUDGMENT (SECOND DEPT).
The Second Department, reversing Supreme Court, determined defendant in this rear-end collision case raised a question of fact precluding summary judgment. Defendant alleged plaintiff abruptly changed lanes without signaling and came to a sudden stop in front of defendant’s vehicle:
… [A] rear-end collision with a stopped or stopping vehicle establishes a prima facie case of negligence on the part of the operator of the rear vehicle, requiring that operator to come forward with evidence of a nonnegligent explanation for the collision to rebut the inference of negligence” … . “A nonnegligent explanation may include that a vehicle made a sudden lane change in front of a defendant’s vehicle, forcing the defendant to stop suddenly” … .
Here, the plaintiff established her prima facie entitlement to judgment as a matter of law on the issue of liability by submitting an affidavit wherein she averred that the rear of her stopped vehicle was struck by the front of the defendants’ vehicle ̷