Kratter Corp. v. Grad ( 1962 )

Morris E. Spector, J.

The third-party defendant moves to dismiss the third-party complaint for legal insufficiency. In the main action the plaintiff has alleged three causes of action against the defendant, all sounding in tort. It is alleged that certain fraudulent representations were made to induce the contract and that the defendant failed to reveal to plaintiff the terms of a certain reverter clause and certain conditions that he was under a duty to disclose. Defendant denies making the representations and denies that plaintiff did not have knowledge of the reverter. In the third-party action defendant seeks an action over against the third-party defendant, title insurance company, on the ground that at defendant’s request a title report was sent to plaintiff and that if plaintiff sustained damages by defendant’s failure to disclose these matters to plaintiff, such damages are due to third-party defendant’s failure to make known conditions to plaintiff and hence defendant is entitled to indemnity.

Section 193-a of the Civil Practice Act allows a defendant to bring in a party who is or may be liable to him for all or part of plaintiff’s claim against him.

If the main action herein is proven against the defendant, his liability would be based on his own malfeasance or misfeasance. There is no showing that in these circumstances the third-party defendant would be obliged to indemnify the defendant. If it is not proven, then the plaintiff would have no claim against the defendant and, therefore, no action over would lie.

The alleged failure of defendant to disclose information to plaintiff and the subsequent request of a title report does not result in an action over. It is incumbent on plaintiff to prove that defendant was under a duty to disclose the information and that he fraudulently withheld that information. If such is proven, the defendant is liable to plaintiff and the third-party defendant did not agree to indemnify him for such fraud. Again if not proven no action over would lie. Accordingly, the motion is granted and the third-party complaint dismissed.