Pleading In the Alternative Does Not Justify Duplicative Claim for Unjust Enrichment

In Harvey Public Adjuster, LLC v. Viet Media Agency, Index No. 522665/2022, 2022 NY Slip Op 32033(U) (Sup. Ct. Kings County Aug. 25, 2022), the court dismissed plaintiff’s cause of action for unjust enrichment as duplicative of its claim for breach of contract.

Plaintiff had retained defendant to provide marketing services and paid defendant a substantial advance. Id. at *1. After defendant failed to provide any services, the parties entered an agreement acknowledging the debt and setting a schedule for repayment. Id. at *1-2. But defendant breached that agreement and plaintiff sued, claiming breach of contract and unjust enrichment. Id. at *2.

Defendant moved to dismiss the unjust enrichment claim as duplicative. Id. Plaintiff did not dispute the redundant nature of the claims but argued that it should be permitted to plead them in the alternative to preserve the opportunity of continuing under the unjust enrichment theory should the contract claim fail later in the litigation. Id. at *4.

The court rejected plaintiff’s argument and dismissed the claim. Although plaintiffs generally may plead causes of action in the alternative, an unjust enrichment claim may not duplicate or replace a breach of contract or tort claim. Id. at *5. Unjust enrichment is a unique cause of action, properly addressed to circumstances in which a defendant, through no actionable wrongdoing of its own, receives a benefit to which it is not entitled. Id. But where a defendant is alleged to have committed an actionable wrong, the plaintiff must find its remedy in breach of contract or tort. Id. “To the extent that these claims succeed, the unjust enrichment claim is duplicative; if plaintiff’s other claims are defective, an unjust enrichment claim cannot remedy the defects.” Id.

Importantly, Harvey Public Adjuster should not be read categorically to prohibit pleading in the alternative. Although the court in Harvey Public Adjuster was unimpressed with plaintiff’s attempt to protect against a hypothetical challenge to the validity of the contract, courts do permit plaintiffs to plead unjust enrichment in the alternative “where a bona fide dispute exists as to the existence of a contract.” Emby Hosiery Corp. v. Tawil, 196 A.D.3d 462, 465 (2d Dep’t 2021).[1] A similar exception exists where there is a bona fide dispute as to “the application of a contract in the dispute at issue.” CIP GP 2018, LLC v. Koplewicz, 194 A.D.3d 639, 640 (1st Dep’t 2021).

And of course, a plaintiff may also maintain parallel claims for breach of contract and unjust enrichment where the unjust enrichment claim seeks disgorgement of funds that are not subject to the contract. See, e.g., Slocum Realty Corp. v. Schlesinger, 162 A.D.3d 939, 945 (2d Dep’t 2018) (permitting parallel pleading of unjust enrichment against defendants who were not parties to operative contract).

The Harvey Public Adjuster decision is yet another valuable reminder that equitable claims like unjust enrichment are intended to provide relief in unique circumstances and are nuanced in their application.

If you have questions about properly pleading multiple causes of action or responding to a complaint that asserts duplicative claims, contact Michael Rakower or Travis Mock.

[1] A more nuanced question exists as to whether such a bona dispute exists merely where a plaintiff alleges a contract was procured by fraud. Compare Pramer S.C.A. v. Abaplus Int’l Corp., 76 A.D.3d 89, 100 (1^st Dep’t 2010) (unjust enrichment claim not duplicative because plaintiff alleged contract was procured by fraud) with Shear Enterprises, LLC v. Cohen, 189 A.D.3d 423, 425 (1^st Dep’t 2020) (unjust enrichment claim duplicative despite allegations of fraudulent inducement).