Regolodo v Neighborhood Partnership Hous. Dev. Fund Co., Inc.

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[*1] Regolodo v Neighborhood Partnership Hous. Dev. Fund Co., Inc. 2009 NY Slip Op 52338(U) [25 Misc 3d 1229(A)] Decided on November 3, 2009 Supreme Court, Kings County Rivera, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on November 3, 2009
Supreme Court, Kings County

Marcelo Regolodo and Joceylen Regolodo, Plaintiff,

against

Neighborhood Partnership Housing Development Fund Company, Inc., Pacific Village, LLC and BFC Construction Corp., Defendants.



9371/2003



For Plaintiffs:

Law Offices of Ira Perlman & Robert Rosen

55 Bryant Ave. Penthouse Suite

Roslyn, NY 11576

For Defendant NPH:

Nicolleti, Gonson, Spinner, & Owen LLP

555 5th Avenue, 8th floor

NY, NY 10017

For Defendant US Fire Insur

Carroll, McNulty, & Kull LLC

NY, NY 10022

For Defendant BFC

Jonathan Judd

Harkins, Rosenfeld, Varriale, LLP

11 Penn Plaza, Suite 2101 NY, NY

Francois A. Rivera, J.



By notice of motion filed on July 6, 2009, under motion sequence number ten, plaintiffs seek an order pursuant to CPLR §2104 enforcing a stipulation of settlement between plaintiffs and defendant BFC Construction Corporation (BFC). BFC opposes the motion.

[*2]BACKGROUND

The court has taken judicial notice of the Kings County Clerk's office court records of the instant case to ascertain the following background facts. On March 14, 2003, plaintiff commenced the instant action by filing a summons and verified complaint. The complaint was later amended. BFC joined issue by its answer dated March 21, 2005. On December 18, 2008, BFC filed a consent to change attorney by which Havkins Rosenfeld & Varriale replaced the firm of Smith Mazure Director Wilkins Young & Wagman, P.C. as its counsel.

Marcelo Regolodo's complaint is for personal injuries sustained on July 23, 2001 while working on a construction project at a premise known as 1373 Pacific Street, in Kings County New York (the subject premise). Joceylen Regoldo's derivative claim is for the loss of her husband's services and consortium. Pacific Village, LLC (hereinafter Pacific) owns and Neighborhood Partnership Housing Development Fund Company, Inc (hereinafter NPHD) manages and maintains the subject premise. NPHD hired BFC as a general contractor to perform construction work at the premise. Marcelo Regolodo injures were allegedly caused by BFC's negligence at the construction site.

MOTION PAPERS

Plaintiffs motion is supported by the affirmation of Robert D. Rosen, their counsel, and four documents that were sent to him which are annexed as exhibits A through D. Exhibit A and B are electronic mails sent by Jonathan A. Judd, BFC's counsel, on June 5th and 11th 2009. Exhibit C is a letter dated June 12, 2009, from the New York State Insurance Fund. Exhibit D is a letter dated June 11, 2009 from Kristin V. Gallagher, counsel to the United States Fire Insurance Company.

BFC opposes the motion with an affirmation of its counsel; and plaintiffs reply with another affirmation of their counsel and a copy of a court decision.

APPLICABLE LAWCPLR § 2104 states in relevant part that an agreement between parties or their attorneys relating to any matter in an action, other than one made between counsel in open court, is not binding upon a party unless it is in a writing subscribed by him or his attorney or reduced to the form of an order and entered. With respect to stipulations of settlement, the terms of such stipulation shall be filed by the defendant with the county clerk.

CPLR § 5003-a (a) states in relevant part:

When an action to recover damages has been settled, any settling defendant ... shall pay all sums due to any settling plaintiff within twenty-one days of tender, by the settling plaintiff to the settling defendant, of a duly executed release and a stipulation discontinuing action executed on behalf of the settling plaintiff. DISCUSSION

The admissions of BFC's counsel, in paragraph six of his affirmation in opposition [*3]to the motion conclusively establishes that BFC offered the plaintiffs $200,000.00 to settle the instant complaint; that the plaintiffs accepted the offer; and that BFC acknowledged the acceptance by an email sent to plaintiffs' counsel on June 11, 2009. With the settlement in place, the plaintiffs obtained the New York State Insurance Fund's (NYSIF) consent to the settlement and its agreement to accept approximately half of the amount of its Worker's Compensation lien it held against plaintiff Marcelo Regolodo.

BFC does not dispute these facts. Instead it contends that the agreement is unenforceable by the instant motion because it does not comply with the formal requirements of CPLR §2104. BFC's counsel states the following in paragraph six of his affirmation.

"Although a settlement offer was communicated to the plaintiff via email, the agreement was reached orally between your affirmant and the attorney for the plaintiffs, over the telephone. See, the Affirmation of Robert D. Rosen, pp. 3-4, ¶ 17-18. The email message sent by your affirmant following the oral agreement served as a mere confirmation of the dollar amount; it specifically stated that the agreement was conditional and that BFC's insurer would insist on specific language being included in the final agreement. See, the Affirmation of Robert D. Rosen, pp. 4, ¶ 19.

The issues as narrowed by the parties arguments are whether the settlement agreement complies with the statutory formal requirements of CPLR §2104. If not, should BFC be estopped from asserting the lack of formal compliance to avoid judicial enforcement of their agreement?

Stipulations of settlement are judicially favored, will not lightly be set aside, and "are to be enforced with rigor and without a searching examination into their substance" as long as they are "clear, final and the product of mutual accord" (Peralta v All Weather Tire Sales & Serv., Inc., 58 AD3d 822 [2009], citing Bonnette v. Long Island College Hospital, 3 NY 281, 286 [2004]). To be enforceable, stipulations of settlement must conform to the requirements of CPLR §2104 (Peralta v All Weather Tire Sales & Serv., Inc., supra.) Pursuant to CPLR §2104 a stipulation of settlement is not enforceable unless it is made in open court, reduced to a court order and entered, or contained in a writing subscribed by the parties or their attorneys" Bonnette v. Long Island College Hospital, 3 NY 281, 285 [2004]). However, where there is no dispute between the parties as to the terms of the agreement, the courts will refuse to permit the use of this rule against a party who has been misled or deceived by the oral agreement to his detriment or who has relied upon it (Smith V Lefrak Organization, Inc., 142 AD2d 725 [2nd Dept., 1988]).

BFC's counsel advised plaintiff in an email it sent on June 11, 2009, as follows.

"Please allow this to confirm that you have agreed to settle this matter for $200,000.00 pending the resolution of issues relating to the workers' compensation lien. Kindly let me know when these issues are resolved and I will send you a release with the language [*4]required by Crum & Foster. Thank you."

The agreement was not made in open court or reduced to a court order and entered, or subscribed by BFC. It, therefore, does not comply with formal requirements of CPLR § 2104. The court finds, however, that BFC should be estopped from raising the technical defect to avoid the unequivocal terms of its agreement. The amount of the settlement was $200,000.00 with no additional conditions on BFC other than payment. BFC was aware that the plaintiffs were concerned about a Workers Compensation lien on the settlement proceeds but this was a concern for the plaintiffs and not BFC. The fact that the NYIF had an assertable lien and that plaintiff were seeking to compromise did not have any bearing on the obligation of BFC to pay the plaintiffs $200,000.00. It simply affected the net proceeds of the settlement left to the plaintiffs after payment of the lien. Plaintiffs needed a bona fide settlement to take to NYSIF in order to negotiate a compromise of NYSIF's worker's compensation lien on the settlement proceeds. BFC's indication that it would wait for plaintiff to resolve the Worker's Compensation lien to send a release to plaintiffs did not make its own settlement with plaintiffs conditional. Furthermore, BFC's promise to send a release with language required by Crum & Foster did not make the material terms of the settlement unclear. The language used in a release document may vary. Such language is not a material element of the settlement. It is a

by-product of the agreement and not an element of same.

The court finds that the agreement and all its material terms were clear, final and definite. The court further finds that the plaintiffs relied on the agreement to negotiate a compromise with NYSIF over its lien on the settlement proceeds. BFC is estopped from taking refuge in the technicality that literal compliance was not had with CPLR §2104 (Van Ness V Rite-aid of New York , Inc.,129 AD2d 931 [3rd Dept., 1987]). The agreement is enforceable.

BFC is, therefore, ordered to pay the plaintiffs $200,000.00 in accordance with CPLR §5003-a after tender of a duly executed release and a stipulation of discontinuance of the action executed by the plaintiffs.

The foregoing constitutes the decision and order of this court.

x

J.S.C.

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