LaFazia v. Howe

Supreme Court of Rhode Island, 1990.

575 A.2d 182.

Dawson, pp. 490-494


Facts: The plaintiffs agreed to sell a deli to the defendants.  The defendants checked out the records of the place and thought it didn’t seem like a viable business.  However, the plaintiffs assured them that it was profitable because the plaintiffs themselves were well-off.  The parties signed the deal for the purchase and sale of the business, which included merger and disclaimer clauses.  The defendants paid $60,000 and signed a $30,000 promissory note.  The business did poorly and the Howes couldn’t pay part of the balance of the promissory note.  The plaintiffs sued for breach of that note.  The defendants counterclaimed on a fraud theory, saying they were induced by the plaintiffs’ misrepresentations into making the deal for the deli.  The plaintiffs pointed to the disclaimer and merger clauses and moved for summary judgment.


Issue: Were the plaintiffs appropriately entitled to summary judgment?






Conclusion: The order for summary judgment is affirmed.


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