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IT WAS SUFFICIENTLY ALLEGED THE RELEASE WAS INDUCED BY FRAUD; THE COMPLAINT SHOULD NOT HAVE BEEN DISMISSED (FIRST DEPT).

The First Department, reversing Supreme Court, determined the complaint should not have been dismissed on the basis of the release because it was sufficiently alleged the release was induced by fraud:

Plaintiff’s complaint sufficiently alleges that the general release that was the basis for dismissal of the complaint was fraudulently induced based on defendant’s misrepresentations upon which plaintiff justifiably relied … . For example, the complaint alleges, among other things, that defendant induced plaintiff’s signature on the release by stating that if plaintiff did not sign, defendant would withdraw a New York Gaming Commission complaint that plaintiff had urged defendant to file, when, in fact, there was no complaint to withdraw because defendant had falsely represented he had filed the complaint.

Upon a “detailed analysis of whether plaintiff had sufficiently alleged the existence of overreaching or unfair circumstances such that enforcement of the general release[] would be inequitable” … , we concluded that dismissal of the complaint based on the release was not warranted. Jones v Jacobs, 2025 NY Slip Op 00377, First Dept 1-23-25

Practice Point: Here the complaint sufficiently alleged the release was induced by fraud. The complaint should not have been dismissed based on the release.​

 

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