Bunton v. Houze

Business Law

, New York Law Journal


Justice Barbara Jaffe

Bunton moved to dismiss defendants' counterclaims and affirmative defenses, while defendants cross-moved for dismissal of the complaint. Bunton and Philippe Houze discussed an agreement for Bunton to purchase a stake in L'Epicerie, and perform certain services for the corporation in return for compensation. Several drafts of an agreement were written, but none were signed. Bunton paid Philippe $100,000 reflecting a stock purchase in L'Epicerie. After disputes arose, Philippe and his wife drafted a loan agreement for repayment of Bunton's $100,000, with Philippe assuring Bunton of full repayment. Defendants have not yet repaid the loan. Philippe counterclaimed that Bunton owed L'Epicerie a fiduciary duty, which he breached, causing defendants to sustain damages. The court stated that by submitting proof of the loan agreement and defendants' default, Bunton met his burden of establishing entitlement to recovery on the agreement. It stated it was not Bunton's burden to establish the existence of adequate consideration for the loan, ruling defendants failed to establish that their defense of lack of consideration had merit. Yet, the court stated defendants sufficiently pleaded their two breach counterclaims, denying both the motion and cross-motion for dismissal.

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