Oscar DaSilva Real Estate LLC v Who Turned Up The Gravity, Inc.

[*1] Oscar DaSilva Real Estate LLC v Who Turned Up The Gravity, Inc. 2009 NY Slip Op 50193(U) [22 Misc 3d 1120(A)] Decided on February 9, 2009 Nassau Dist Ct Fairgrieve, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. As corrected in part through February 17, 2009; it will not be published in the printed Official Reports.

Decided on February 9, 2009
Nassau Dist Ct

Oscar DaSilva Real Estate LLC, Petitioner(s)

against

Who Turned Up The Gravity, Inc., d/b/a Bad Bob's B-B-Q, Respondent(s)



SP 3138/08



REPRESENTATION:

Jay A. Marshall, Esq., Attorney for Respondent, 585 Stewart Avenue, Suite 790, Garden City, New York 11530, (516) 228-8530; Novick, Edelstein, Lubell, Reisman, Wasserman & Leventhal, P.C., Attorneys for Petitioner, 733 Yonkers Avenue, Yonkers, New York 10704, (914) 375-0100.

Scott Fairgrieve, J.

Petitioner commenced a commercial non-payment proceeding against Respondent who operates a restaurant at 3112-311 Lawson Boulevard, Oceanside, New York, for the sum of $43,308.40. Respondent filed an answer with affirmative defenses and counterclaims, fiercely denying liability because of the failure of Petitioner to properly maintain the premises. The parties (after numerous court conferences) settled the disputes by the Stipulation of Settlement ("Stipulation"), dated September 22, 2008.

Subsequently, Respondent moved by order to show cause for the following relief due to Petitioner's alleged breach of the Stipulation: (1) terminating Respondent's obligation to make any further payments to Petitioner pursuant to the Stipulation dated September 22, 2008; (2) directing a hearing to ascertain the damages sustained by Respondent as the result of Petitioner's breach of the Stipulation; and (3) directing Petitioner to pay the legal fees which Respondent incurred to bring this application.

The Stipulation provided that Petitioner would install, subject to access to the premises, an electrical sub-meter by October 31, 2008, and an air-conditioning/heating unit by November 15, 2008, and that Respondent would pay rental arrears and utility charges amounting to $52,700 on a structured payment schedule. Further, the Stipulation states that Petitioner shall give notice of any default to Respondent's attorney by fax and that, in the event Respondent fails to cure its default within three days of the notice, Petitioner may seek a money judgment for immediate payment of $52,700 and also be entitled to immediate entry of judgment of possession and the issuance of a warrant of eviction without stay.

In compliance with the Stipulation, Respondent made timely payments for September and [*2]October 2008. During this time, Respondent was periodically contacted by electricians hired by Petitioner to make the stipulated installations. Petitioner alleges that these electricians were not given reasonable access to the premises, and by November 15, 2008, neither the electrical sub-meter nor the air-conditioning/heating unit were installed. As a result, Respondent withheld payment for November 2008, claiming that Petitioner defaulted on the Stipulation by failing to meet the agreed upon deadlines. In response, Petitioner claimed that Respondent defaulted on the Stipulation by failing to allow reasonable access and by withholding payment of November's rental arrears.

Regardless of whether Respondent failed to provide reasonable access to the premises, Petitioner never put the Respondent on notice of the any default as required by the Stipulation. While Respondent was occasionally contacted by Petitioner's electricians and also received a fax from the lead electrician concerning the necessity of filing an application with the Long Island Power Authority ("LIPA"), the Petitioner never sent any formal notice of default to Respondent's attorney for failure to allow reasonable access to the premises before the October 31 deadline. The only formal notice of default sent by the Petitioner came on November 12, 2008, for failure to pay the November arrears. However, this notice of default came 12 days after Petitioner was in default for failure to install the electrical sub-meter.

The weight of authority in this jurisdiction binds courts to enforce stipulations of settlement so long as they are freely agreed to. Hallock v. State of New York, 64 NY2d 224, at 230; Capital One Bank v. Hembrick, 17 Misc 3d 1128(A), 851 NYS2d 68, 2007 WL 4040973; Matter of New York, Lackawanna & Western R.R. Co., 98 NY 477. Stipulations of settlement are enforced strictly so long as the language is not ambiguous. Binensztok v. Bello, 285 AD2d 619, 728 NYS2d 750, 2001 NY Slip Op. 06510. A party seeking to hold another party in default must comply with the default provision of the stipulation of settlement and provide proof of same. See Solid Gold Construction v. Robertson, 1 Misc 3d 136(A), 781 NYS2d 628, 2003 WL 23214145, 2003 NY Slip Op. 51662(U), wherein the court held: The stipulation of settlement provided that if defendant defaulted in her payments, which default continued for at least ten days after the attorney for plaintiff sent her a written notice of default, plaintiff was at liberty to enter judgment against the defendant for the full amount demanded in the complaint. We are in agreement with the lower court that plaintiff failed to submit sufficient proof of mailing of the requisite notice of default. Accordingly, the lower court properly vacated the judgment.

Here, Respondent and Petitioner represented by counsel entered into a stipulation of settlement that contained a notice of default clause effective against Petitioner. The notice of default clause clearly expressed that Petitioner had an affirmative duty to put Respondent on notice of any default. Petitioner failed to put Respondent on formal notice of default for the alleged disallowance of reasonable access to the premises. Therefore, Petitioner defaulted before any notice and opportunity to cure was given to Respondent.

Since Petitioner defaulted on the Stipulation by failing to meet the installation deadlines and in providing notice of default, Respondent is excused from making payments under the Stipulation [*3]of Settlement. See Melodies v. Mirabile, 7 AD2d 783, 179 NYS2d 991, wherein the court excused the non-defaulting party from any further performance due to the breach: Here there was a total breach of contract which not only renders the breacher liable in damages but it also excuses the obligee from the duty of further performance. The cost of this (further performance) must be deducted from the contract price in arriving at the amount of damages.

Thus, in the case at bar, Respondent is excused from making payments on the Stipulation of Settlement due to Petitioner's breach. See also 22 NY Jur. 2d Contracts Sec. 417.

In Binensztok, the plaintiff and defendant entered into a stipulation of settlement on a personal injury claim. The stipulation of settlement clearly provided that payment by the defendant was to be proceeded by signed releases and stipulations of discontinuance. Id. The court found that: The stipulation of settlement clearly provides that the various defendants, and Jack Binensztok in his capacity as the defendant on the counterclaim, have no obligation to perform their part of the agreement until after the respondents have executed and delivered signed releases and stipulations of discontinuance.

Id. (emphasis added). Likewise, Respondent had no duty to cure until after notice was given. Additionally, Respondent had no duty to continue payments once Petitioner had breached the Stipulation by failing to meet the agreed upon deadlines. On these facts, Petitioner — and Petitioner alone — is in breach of the Stipulation.

This matter is set down for a hearing for March 13, 2009, at 9:30 a.m. to ascertain the damages sustained by Respondent due to Petitioner's breach of the Stipulation of Settlement.

SO ORDERED:

/s/ Hon. Scott Fairgrieve

DISTRICT COURT JUDGE

Dated:February 9, 2009

cc:Jay A. Marshall, Esq.

Novick, Edelstein, Lubell, Reisman, Wasserman & Leventhal, P.C.

SF/cm