In Danzig v. Grynberg & Associates (1984) 161 Cal. App. 3d 1128, limited partner investors brought an action against the general partner on the basis of fraudulent misrepresentations and nondisclosures in inducing the limited partners to invest in the partnership.
The trial court found that the misrepresentations and nondisclosures were intentional and willful, that the limited partners reasonably and justifiably relied upon them in purchasing their partnership interests, and that but for such fraudulent conduct the limited partners would not have invested in the partnership.
The Danzig Court of Appeal concluded the disclaimer language contained in the agreement could not preclude a finding of justifiable reliance.