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Fraud is Involved in Malpractice Action


This is an action to recover damages for fraud. The New York City plaintiffs are appealing an order made by the Supreme Court of Suffolk County that granted the defendant’s motion for summary judgment dismissing the complaint against them.

Case Background

The plaintiffs in this case are an infant and his father. In 1987, the plaintiffs settled a medical malpractice action against an insured of the respondent in this case. The settlement included an annuity that would provide payments to the infant plaintiff in the sum of $3000 per month for life. The respondent estimated the present value of the entire settlement package to be $940,180.

In 1992, the plaintiffs started this action against the respondent seeking damages for fraud, intentional misrepresentation, and negligent representation. The plaintiffs allege that the respondent had knowledge and expertise in the issue of structured settlements and misrepresented the present value of the annuity provision of the settlement knowing that the plaintiff’s would rely on the misrepresentation to their detriment in order to settle the matter.

The respondent argues that the plaintiffs were not entitled to rely on the represented present value of the package because they could have independently determined the value for themselves.

Court Discussion and Decision

The Supreme Court granted the motion for summary judgment to dismiss the complaint made against them. The court has reviewed the facts of the case and is reversing the order from the Supreme Court of Suffolk County. It is found that there are questions of fact in regard to the case and for this reason the motion is denied and the complaint is reinstated against the defendant.

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