Under New York law, a party’s performance may be excused, even if the contract contains no express provision for the event that made performance impossible. See , e.g. , City of New York v. Local 333, Mar. Div., Intl. Longshoremen’s Assn. , 79 A.D.2d 410 (1st Dept. 1981). To determine whether performance may be excused, the court takes a wholistic approach, considering the facts and circumstances surrounding the non-performance and the roles, if any, the parties played in sai

In today’s installment of Enforcement News, this Blog examines, among other things, the fiduciary duties of investment advisers, in particular, the duty of loyalty. An investment adviser is a fiduciary, and as such is held to the highest standard of conduct and must act in the best interest of his/her client. SEC v. Capital Gains Research Bureau, Inc. , 375 U.S. 180, 194 (1963). This means, among other things, that an investment adviser has an affirmative duty of utmost good

Most simply stated, champerty is the prohibited practice of purchasing claims for the purpose of commencing litigation and has been described as “a venerable doctrine developed hundreds of years ago to prevent or curtail the commercialization of or trading in litigation.”  Bluebird Partners, L.P. v. First Fidelity Bank, N.A. , 94 N.Y.2d 726, 729 (2000) (describing the historical antecedents to New York’s present champerty rules).  While an ages old doctrine dating back to med

A “recurring question” New York courts grapple with is whether the facts alleged in a complaint give rise to claims for both breach of contract and fraudulent inducement. Cronos Grp. v. XComIP, LLC , 156 A.D.3d 54, 56 (1st Dept. 2017). Readers of this Blog know that a fraud claim, which “ar from the same facts , s identical damages and d not allege a breach of any duty collateral to or independent of the parties’ agreements<,> is subject to dismissal as redundant of the c

When a person releases another from claims or the threat of claims, he/she is giving up the right to sue the other in connection with the subject of the release. Centro Empresarial Cempresa S.A. v América Móvil, S.A.B. de C.V. , 17 N.Y.3d 269, 276 (2011) (“Generally, a valid release constitutes a complete bar to an action on a claim which is the subject of the release.”). A release effectively eliminates all claims against another that are possessed by the party giving the re

It has been over 100 years since Charles Ponzi was indicted for the fraudulent scheme that bears his name. In a Ponzi scheme, the operator creates an investment program in which “profits” are paid to earlier investors with money taken from later investors. The “profits” are, therefore, fictitious instead of returns on investment. Ultimately, Ponzi schemes collapse under their own weight, taking investors, many of whom are the later ones in the scheme, down with them. Unfortun

Generally, matters that are not covered by an agreement to arbitrate do not have to be arbitrated. After all, arbitration is a creature of contract. And, because an agreement to arbitrate is governed by the rules of contract interpretation, the courts must “give effect to the contractual rights and expectations of the parties.” Volt Info. Scis., Inc. v. Board of Trustees of Leland Stanford Junior Univ. , 489 U.S. 468, 479 (1989). In other words, “as with any other contract, t

Promissory notes and mortgages, like many other contracts, frequently contain provisions requiring a non-breaching party to provide the breaching party with notice of their default as a condition precedent to taking any action to enforce rights as a result of the breach.  Such action can include, but is not limited to, commencing legal action and/or accelerating the unpaid balance due under the note.  Similarly, default notice provisions may require that, in certain circumsta

Under well-settled principles, summary judgment in lieu of complaint is available for an instrument for the payment of money only. In considering such a motion, the courts will look at the four corners of the instrument sued upon in determining whether the instrument qualifies as one for the payment of money only. here.=">here</a>."> In Yang v. Dai , 2021 N.Y. Slip Op. 02125 (1st Dept. April 6, 2021) ( here ), the Appellate Division, First Department applied the foregoing pri