Court Opinion

ID: 5231323
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:56:59.060683+00
Date Added: 2024-06-11T08:27:40.314384
License: Public Domain

McLaughlin, J.:
Issue having been joined in this action defendants moved for judgment on the pleadings on the ground that the complaint did not state facts sufficient to constitute a cause of action. (Code Civ. Proc. § 547.) The motion was granted and plaintiff appeals.
If the facts stated in the complaint show that the plaintiff is entitled to any relief (Wetmore v. Porter, 92 N. Y. 76; Hotel Register Co. v. Osborne, 84 App. Div. 307; Clark v. Levy, 130 id. 389) then it is not demurrable and the order granting the motion for judgment on the pleadings is erroneous. The action is brought to recover damages for fraud and deceit. *796The complaint alleges, in substance, that the parties entered into an agreement by which they were to purchase an assignment of certain letters patent, the plaintiff to advance one-half of the purchase price and each of the defendants one-quarter; that the defendants represented to the plaintiff the lowest amount for which the patents could be purchased was $3,000, and he, relying upon this-representation, entered into the agreement and advanced $1,500; that the patent was thereafter assigned to the plaintiff and defendants, the consideration mentioned being $3,000. The complaint further alleges that the purchase price was not $3,000, but in fact only $2,000, of which the defendants advanced- only $500; that after the letters patent were purchased a corporation was formed, under the laws of the State of Hew York, and the same assigned to it; that such letters constituted its sole assets, for which thirty shares of stock of $100 each were issued — fifteen to the plaintiff and fifteen to the defendants; that by reason of the false representation made to the plaintiff the defendants received seven and one-half shares to which they were not entitled; that subsequent to the issuing of the stock plaintiff purchased the fifteen shares issued to the defendants and paid them $3,000 therefor; that the reasonable value of the stock was $200 per share; that the corporation paid profits to defendants on the seven and one-half shares during the time they held the same, amounting to $1,500; that by reason of these facts plaintiff claims to have been damaged to the amount of $1,500 (the amount which he paid for the seven and one-half shares) and also $1,500 (profits received by defendants on said shares), and judgment is demanded for $3,000 and interest.
Upon these facts I am of the opinion plaintiff is not entitled to the relief demanded, The corporation was regularly formed and plaintiff’s interest therein was precisely what he supposed it would be at the time of the organization. He received his fifteen shares and alleges that the same were worth at least $200 per share. If he were damaged at all by reason of the representations alleged it was not by reason of the formation of the corporation and the issuance of the stock, or payments of profit thereon, but by the agreement to purchase the letters patent. He agreed to pay one-half of the purchase price, but *797by reason of the false representations of the defendants, upon which he relied, believing he was only paying one-half, he paid three-quarters. They falsely stated to him that the purchase price was $3,000, when in truth and fact it was only $2,000. He advanced $1,500 when he should only have advanced $1,000. He was, therefore, damaged to the amount of $500, and while the appellant expressly states in the brief presented that the action is not brought to recover the $500, nevertheless, applying the rule above alluded to, I think the complaint states a cause of action to that extent and for that reason the order appealed from is reversed, with ten dollars costs and disbursements, and the motion for judgment denied, with ten dollars costs.
Laughlin, Dowling and Hotchkiss, JJ., concurred; Ingraham, P. J., dissented.