Dalton Farms Homeowners Assn., Inc. v New Deal Dev., Inc.

[*1] Dalton Farms Homeowners Assn., Inc. v New Deal Dev., Inc. 2006 NY Slip Op 52407(U) [14 Misc 3d 1204(A)] Decided on December 13, 2006 Supreme Court, Dutchess County Pagones, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on December 13, 2006
Supreme Court, Dutchess County

Dalton Farms Homeowners Association, Inc., individually and on behalf of all Home Owners of Dalton Farm Homeowners Association, Inc., Plaintiff,

against

New Deal Development, Inc., Robert L. Price, Stephen K. Struebing, James H. Gillespie and Craig Mallick, Defendants.



3668/06



John J. LaGumina, ESQ.

Attorney for Plaintiff

2500 Westchester Avenue

Purchase, New York 10577

William W. Frame, Esq.

Corbally, Gartland & Rappleyea, LLP

Attorneys for Defendants

35 Market Street

Poughkeepsie, New York 12601

James D. Pagones, J.

The defendants move to dismiss the plaintiff's complaint upon the grounds that the plaintiff lacks the capacity to maintain the action; that the action is time-barred; and, that the plaintiff's complaint fails to state a cause of action upon which relief may be granted. The defendants also move for admission pro hac vice of attorney Anthony F. Jeselnik.

The plaintiff's complaint sets forth six causes of action sounding in fraud, breach of implied warranty, breach of contract and negligent misrepresentation. Each of plaintiff's causes of action are premised upon an offering plan relating to the Dalton Farms Development; specifically, the fifth amendment to the restated plan which was issued in July, 1996. All of the plaintiff's causes of action relate in some manner to this offering plan.

It is uncontroverted that the type of offering which is the subject of this action is governed by General Business Law Article 23-A, otherwise known as the Martin Act. The elements of the plaintiff's six causes of action are all encompassed in the anti-fraud provisions of General Business Law §352. (People v. Lexington Sixty-First Associates, 38 NY2d 588 [1976].)

It is well established in New York that there is no private cause of action for violation of the anti-fraud provision of the Martin Act. (CPC International, Inc. v. McKesson Corporation, 70 NY2d 268, 275 [1987].) It is of no consequence that the plaintiff refers to the six causes of action as common law fraud, breach of implied warranty, breach of contract, and negligent misrepresentation. An examination of each cause of action indicates that the plaintiff is alleging some form of fraud in the fifth amended offering. I find that the plaintiff does not have standing to bring the instant action based on any of the six causes of action set forth in the complaint as [*2]they constitute Martin Act violations for which there is no private right of action. Therefore, it is ordered that the defendants' motion to dismiss the plaintiff's complaint is granted and the plaintiff's complaint is dismissed in its entirety.

This Court notes also that even if the plaintiff had standing to sue, each of its causes of action are time-barred by the applicable statute of limitation. Additionally, the plaintiff failed to plead fraud with the requisite particularity as required by CPLR Rule 3016(b). (Stern v. Consumer Equities Associates, 160 AD2d 993 [2d Dept. 1990].) In light of this Court's decision, the court has not addressed the application to admit attorney Anthony F. Jeselnik pro hac vice as it is academic.

The foregoing constitutes the decision and order of the Court.

Dated: December 13, 2006

Poughkeepsie, New York

ENTER

Hon. James D. Pagones, A.J.S.C.

TO: