Monday, February 1, 2016

Unjust enrichment claims and the statute of frauds.

Practice point:  The Appellate Division affirmed the denial of defendant's motion to dismiss the unjust enrichment claim in this action to recover a finder's fee allegedly due plaintiff from the sale of certain assets belonging to a nonparty, and misappropriated by defendant. It is uncontested that the finder's fee was a matter of contract between plaintiff and the nonparty, and that plaintiff and defendant were not parties to a written agreement.

Plaintiff's claim is not, as defendant contends, barred by the statute of frauds, at  General Obligations Law § 5-701[a][10]. The Court of Appeals has upheld an unjust enrichment claim in the absence of a writing, and so the statute of frauds is inapplicable and irrelevant to the analysis.

Student note:  An unjust enrichment claim is founded on a quasi-contract theory of recovery and is imposed by equity to prevent injustice, in the absence of an actual agreement between the parties concerned.

Case:  Winthrop v. Rosenthal & Rosenthal, Inc., NY Slip Op 00582 (1st Dept. 2016)

Here is the decision.

Tomorrow's issue:  Premature summary judgment motions.