Overland Leasing Group, LLC v. First Financial Corporate Services Inc.
- Citation:
- 3rd Circuit Court of Appeals, Case Number 10-3713, Filed July 7, 2011
- Tag(s):
-
- Ruling:
- Judgment of the District Court affirmed. In both New York and New Jersey, to prevail in an action against a maker of a representation for malpractice and negligent misrepresentation a claimant must show that: (1) the representation was intended for the claimant's use; (2) the representation was made with the intent that the claimant would rely on it; and (3) there must have been some conduct on the part of the maker linking it to the claimant, which evinces the maker's understanding of the claimant's reliance.
Appellant failed to prove that Appellees owed a duty to Appellant such that Appellees can be found liable to Appellant for malpractice and negligent misrepresentation.
- Procedural context:
- Appeal from the United States District Court for the District of New Jersey granting summary judgment in favor of the Appellees.
- Facts:
- Allserve Systems Corp. (the "Debtor") leased equipment from Overland Leasing Group, LLC ("Overland"). Overland acquired its interest as lessor from the original lessors Fortan Group International, Inc. ("Fortan") and First Financial Corporate Services, Inc. ("First Financial")(collectively, with Fortan, the "Original Lessors" or "Appellees") in March 2005 (the "Transfer").
Prior to the Transfer, Funaro, an accounting firm, issued an independent auditor's report of the Debtor's financial statements in June 2004 and a report compiling the Debtor's financial statements in January 2005. Near the end of July 2005, Turrin, another accounting firm, prepared an audit report of the Debtor's finances for the year ending March 31, 2005. In August 2005, the Debtor ceased making payments to Overland and subsequently declared bankruptcy.
In December 2006, Overland sued numerous parties, including the Original Lessors. Overland alleged, among other things, that the Original Lessors committed accountants' malpractice and negligent misrepresentation of financial information and that the Original Lessors intentionally and recklessly misrepresented the Debtor's financial condition.
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