Ingrid W. Speck, et al. vs. Justfly Corp., et al.

Analysis

“The elements of fraud that will give rise to a tort action for deceit are: “ ‘(a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.’ ” Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 974. “Fraud is an intentional tort; it is the element of fraudulent intent, or intent to deceive, that distinguishes it from actionable negligent misrepresentation and from nonactionable innocent misrepresentation.

It is the element of intent which makes fraud actionable, irrespective of any contractual or fiduciary duty one party might owe to the other.” City of Atascadero v. Merrill Lynch, Pierce, Fenner & Smith (1998) 68 Cal.App.4th 445, 482. “[F]raudulent intent is an issue for the trier of fact to decide.” Beckwith v. Dahl (2012) 205 Cal.App.4th 1039, 1061.

At bar, Defendants, among other things, argue, “Plaintiffs have zero evidence that Mr. Fraiman falsely represented that the Project would not require permits...[a]side from Ms. Palleschi’s post hoc assertions in deposition....” Mot., 8:8-20. They further argue that Plaintiffs have no evidence that any alleged misrepresentation induced Michelle Palleschi’s execution of the contract, or that she justifiably relied on it. Mot., 10:22-11:11. The Court is not persuaded.

First, Defendants’ motion itself acknowledges that Ms. Palleschi offered deposition testimony that Mr. Fraiman falsely represented that the Project would not require permits. In light of this, Defendants have not met their threshold burden of showing that this element cannot be established. Assuming, arguendo, Defendants met their burden, Plaintiffs have shown that a triable issue of fact exists with respect to this representation. In short, Plaintiffs have offered evidence that Fraiman represented to Michelle Palleschi that: permits would not be required, he knew at signing he was not going to pull a permit, he knew a permit was legally required, and he knew there would be no final inspection absent a permit. See Opp’n, 8:27-9:24 and citations therein.

Second, Michelle Palleschi's verified allegations establish that she specifically asked Fraiman about permitting before signing, that he answered falsely, and that she signed the contract at issue in reliance on that answer. See Opposition, 18:5-13 and citations therein.