You are here: / / A SOPHISTICATED PARTY’S REQUEST FOR AND RECEIPT OF WRITTEN ASSURANCES...
,

A SOPHISTICATED PARTY’S REQUEST FOR AND RECEIPT OF WRITTEN ASSURANCES FROM DEFENDANT WAS A VALID SUBSTITUTE FOR A DUE DILIGENCE INQUIRY, SUPREME COURT’S DISMISSAL OF FRAUD ACTION REVERSED.

The First Department, reversing Supreme Court, determined the motion to dismiss the complaint alleging fraud should not have been granted, and the motion to amend the complaint to allege negligent misrepresentation should have been granted. Supreme Court ruled that plaintiff was a sophisticated lender and made the loan without performing due diligence (and therefore could not allege justifiable reliance on any misrepresentations). The First Department held that plaintiff’s request for and receipt of written assurances was sufficient due diligence:

A sophisticated party is generally required to exercise due diligence to verify the facts represented to it before entering into a business transaction … . The Court of Appeals has recognized, however, that, “where a plaintiff has gone to the trouble to insist on a written representation that certain facts are true, it will often be justified in accepting that representation rather than making its own inquiry” … . In this case, plaintiff alleges that it made the loan … in reliance on [defendant] Noto’s opinion letter, which was specifically addressed to plaintiff, in which Noto opined that the loan transaction would not put [any party] into breach of any preexisting contract or agreement … . Plaintiff alleges that this representation was false, inasmuch as the undisclosed 2005 letter agreement required [maintenance of] a $2 million cushion of “unencumbered equity” in the property in any refinancing, and — given that the true value of the property was only $1.9 million, based on the terms of the undisclosed 2005 transaction — plaintiff’s $6.6 million loan … wiped out any such equity in the property. Remediation Capital Funding LLC v Noto, 2017 NY Slip Op 01119, 1st Dept 2-10-17

CONTRACT LAW (A SOPHISTICATED PARTY’S REQUEST FOR AND RECEIPT OF WRITTEN ASSURANCES FROM DEFENDANT WAS A VALID SUBSTITUTE FOR A DUE DILIGENCE INQUIRY, SUPREME COURT’S DISMISSAL OF FRAUD ACTION REVERSED)/FRAUD (A SOPHISTICATED PARTY’S REQUEST FOR AND RECEIPT OF WRITTEN ASSURANCES FROM DEFENDANT WAS A VALID SUBSTITUTE FOR A DUE DILIGENCE INQUIRY, SUPREME COURT’S DISMISSAL OF FRAUD ACTION REVERSED)/MISREPRESENTATION (A SOPHISTICATED PARTY’S REQUEST FOR AND RECEIPT OF WRITTEN ASSURANCES FROM DEFENDANT WAS A VALID SUBSTITUTE FOR A DUE DILIGENCE INQUIRY, SUPREME COURT’S DISMISSAL OF FRAUD ACTION REVERSED).SOPHISTICATED PARTY (A SOPHISTICATED PARTY’S REQUEST FOR AND RECEIPT OF WRITTEN ASSURANCES FROM DEFENDANT WAS A VALID SUBSTITUTE FOR A DUE DILIGENCE INQUIRY, SUPREME COURT’S DISMISSAL OF FRAUD ACTION REVERSED)/DUE DILIGENCE (A SOPHISTICATED PARTY’S REQUEST FOR AND RECEIPT OF WRITTEN ASSURANCES FROM DEFENDANT WAS A VALID SUBSTITUTE FOR A DUE DILIGENCE INQUIRY, SUPREME COURT’S DISMISSAL OF FRAUD ACTION REVERSED)

You might also like
DEFENDANT RESTAURANT DEMONSTRATED IT DID NOT HAVE ACTUAL OR CONSTRUCTIVE NOTICE OF THE GREASY OR SLIPPERY CONDITION IN THIS SLIP AND FALL CASE, DEFENDANT’S MOTION FOR SUMMARY JUDGMENT PROPERLY GRANTED (FIRST DEPT).
DEFENDANT MANUFACTURED VALVES CONTAINING ASBESTOS; ALTHOUGH DEFENDANT HAD A SMALL OFFICE IN NYC THE VALVES WERE MANUFACTURED AND SOLD IN CONNECTICUT, WHERE PLAINTIFF LIVED AND WORKED; THE RELATIONSHIP BETWEEN NEW YORK AND PLAINTIFF’S CLAIMS WAS NOT SUFFICIENT FOR NEW YORK JURISDICTION (FIRST DEPT). ​
Exclusion of Defendant’s Brother from the Courtroom Based Upon the Fear of a Testifying Witness Was Proper, Despite Lack of Express Findings by Trial Judge
No Exigent Circumstances to Justify Search of a Closed Container in Defendant’s Possession Upon His Arrest for Minor Non Violent Offenses to Which the Contents of the Bag Could Have Had No Connection
AMONG SEVERAL LABOR LAW, NEGLIGENCE AND INSURANCE ISSUES ADDRESSED IN THIS LABOR LAW 240 (1), 241 (6) AND 200 ACTION, THE 2ND DEPT DETERMINED SUPREME COURT APPLIED THE WRONG STANDARD IN ITS LABOR LAW 200 ANALYSIS (FIRST DEPT).
CITY AGENCY FAILED TO DEMONSTRATE THE REPORT SOUGHT BY PETITIONERS WAS SUBJECT TO THE INTRA-AGENCY EXEMPTION FROM THE FREEDOM OF INFORMATION LAW (FOIL) BECAUSE THE AGENCY DID NOT PRESENT PROOF THE PREPARER OF THE REPORT WAS RETAINED BY THE AGENCY, SUPREME COURT SHOULD HAVE CONSIDERED PETITIONERS’ REQUEST FOR ATTORNEY’S FEES AS MANDATED BY A 2017 AMENDMENT TO FOIL (FIRST DEPT).
Failure to Accurately Identify Where Slip and Fall Occurred in Notice of Claim Warranted Dismissal of Complaint
Supreme Court’s Grant of Defendants’ Motion to Set Aside Verdict Reversed

Categories

Sign Up for the Mailing List to Be Notified When the Site Is Updated.

  • This field is for validation purposes and should be left unchanged.

Copyright © 2026 New York Appellate Digest, Inc.
Site by CurlyHost | Privacy Policy

DISCLAIMER IN SUBCONTRACT IS AMBIGUOUS, MOTION TO DISMISS FRAUD COUNTERCLAIM... INSUFFICIENT PROOF GUNSHOT CAUSED SERIOUS PHYSICAL INJURY, ASSAULT FIRST CONVICTION...