LEMAD CORPORATION v. IRENE HONACHEFSKYAnnotate this Case
NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
DOCKET NO. A-0
IRENE HONACHEFSKY, JIMMY AGUIRRE
AND AUDREY BETH AGUIRRE,
WILLIAM HONACHEFSKY AND BONITA E.
IRENE HONACHEFSKY, WILLIAM HONACHEFSKY,
BONITA E. HONACHEFSKY, JIMMY AGUIRRE AND
AUDREY BETH AGUIRRE,
CHARLES M. URBAN, IN HIS INDIVIDUAL
CAPACITY, AND DANIEL W. SOLES,
October 24, 2014
Submitted September 2, 2014 Decided
Before Judges Hayden and Leone.
On appeal from Superior Court of New Jersey,
Chancery Division, Morris County, Docket No. C-30-08.
William and Bonita Honachefsky, appellants pro se.
Benbrook & Benbrook, LLC, attorneys for respondent Lemad Corporation (Kevin P. Benbrook, on the brief).
Defendants William and Bonita Honachefsky, husband and wife, appeal from the July 27, 2012 Chancery Division order denying their motion to vacate a settlement agreement with plaintiff Lemad Corporation. We affirm.
The record reflects the following facts. In 2004, Lemad purchased lot 6 on block 68 in Clinton Township. Irene Honachefsky1 owned a single-family home on lot 4, William and Bonita owned a single-family home on lot 4.01, and Jimmy and Audrey Beth Aguirre owned a single-family home on lot 5. Defendants' lots all abutted Lemad's property. The only access defendants had to their properties was by way of a ten foot wide easement called Echo Lane, which was deeded to Irene and her late husband in 1956.2 Lemad purchased lot 6 explicitly subject to the easements possessed by lots 3, 4, 4.01, and 5 for ingress and egress.
When acquiring lot 6, Lemad obtained a new survey of its property and discovered that the Echo Lane easement had "wandered out of the right of way" in certain areas by several feet. Lemad contacted the Honachefskys and suggested an agreement regarding the road and its maintenance. In response, the Honachefskys asserted an adverse possession claim over any physical portion of Echo Lane not falling within the original description of the deeded easement.
In August 2007, William filed a harassment and disorderly conduct criminal complaint against Charles Urban, Lemad's principal shareholder, alleging trespass, harassment and threats. Several months later, on December 28, 2007, Lemad filed a civil complaint against defendants, for trespass, malicious destruction of personal property, trover, and quiet title. The Honachefskys' counterclaims and third-party complaint both contained counts for trespass, violation of the easement, and private nuisance. Since 2008, the Honachefskys have foregone the services of legal counsel and represented themselves in the litigation.
After lengthy discovery and pretrial motions, the parties filed summary judgment motions. On April 13, 2012, the case was scheduled for argument of the pending motions. Instead, the parties engaged in settlement discussions, informed the judge that they had reached an agreement, and placed it on the record. Irene was not present, but William represented that he could consent to the settlement agreement on behalf of his elderly mother. The settlement agreement placed on the record by Lemad's counsel was as follows
Lemad Corporation which owns the property that is encumbered by an existing ten-foot recorded easement,  will consent to draft a new easement. That easement will be 14-foot in width. The 14-foot width will run from the northerly property line of Lemad and will extend out 14 feet from that property line for the entire length of the Lemad property. Lemad will flag that new easement area. It will draw the draft easement and the metes and bounds descriptions for the same. The easement will include, it will be a nonexclusive access easement. It will inure to the benefit, and run with the land of both Mrs. Honachefsky's track, Mr. and Mrs. Honachefsky's track; and the successors in interest to the Aguirre property who is Mrs. Fernandez and one other person . . . . So the ten-foot easement will be expanded to 14 feet. It will be delineated, it will be described by metes and bounds in an easement that will be recorded . . . in the Hunterdon County Clerk's office. And it will have the nonexclusive right of all parties who are beneficiaries to the easement to maintain the roadway within the easement area, including the grading, putting down the stone, and trimming brush, grass and weeds as necessary to maintain the adequate width of the easement . . . [and t]he integrity of the easement area. . . . The 14-foot easement will include the disputed 4.59 feet that is basically between both Honachefskys' properties and the current Echo Lane; there was a gore or a disputed area there. That will now be granted as part of an easement. Which, they can do with the entire length of the easement whatever maintenance, putting down of stone, berming as necessary to maintain the integrity of the roadway for all parties' benefits.
The Honachefskys also agreed to alert the prosecutor that that they no longer wished to pursue the criminal charges pending against Urban, and they agreed to pay up to $2000 towards physically establishing the new easement. Lemad's counsel represented that it would take about forty-five days to get the survey prepared and circulate the easement. The parties agreed to try to have the easement marked out, recorded and improved within eight months.
Before accepting the terms of the settlement, Judge Wilson painstakingly questioned all parties to ensure that they understood and agreed to the terms as stated on the record, and that they wanted to place the settlement on the record that day. The judge also confirmed that they understood that by settling the case they were foregoing the right of appeal they otherwise had. Both William and Bonita stated that they understood and agreed to the settlement terms as recited by Lemad's attorney. The judge noted that William and Bonita were pro se but that William was a professional surveyor and was very familiar with the surveying concepts at issue. After finding that the parties had entered into the settlement freely and voluntarily without coercion or duress, Judge Wilson dismissed the case based on the settlement.
On May 16, 2012, Irene moved to vacate the April 13, 2012 order because she was not present, did not agree, and had not authorized William to agree to the settlement terms. A week later, William and Bonita moved to vacate the settlement agreement and order of disposition. In his supporting certification, William stated that "settlement discussions were done with excess haste and lacked a full and complete meeting of the minds in whole or in part." He also argued that a full and complete agreement could not have been reached due to the absence of Irene, the Aguirres, and the State.
On July 27, 2012, Judge Wilson heard oral arguments and decided to vacate the agreement as to Irene because William did not have the legal authority to bind Irene to the settlement. However, the judge found that William and Bonita fully understood the nature and details of the agreement when they approved its terms and entered into it voluntarily. The judge highlighted that at no time did either William or Bonita indicate any hesitancy or lack of understanding or request extra time to consider the proposed terms. Additionally, the judge noted that the agreement was not contingent on the development of a written settlement agreement. Consequently, the judge declined to allow William and Bonita to vacate their settlement.3
Several months later, on February 6, 2013, William and Bonita filed a motion for leave to appeal, which we denied without prejudice on March 14, 2013. Then, on April 30, 2013, Judge Wilson granted Lemad's motion for summary judgment against Irene4 as unopposed and dismissed the remainder of the case. This appeal followed.
On appeal, William and Bonita argue that they justifiably relied on Lemad's misrepresentation during the settlement negotiations that the proposed fourteen-foot wide easement would "wholly encompass the existing physical Echo Lane roadway" and require "nothing more than some minor brush cutting and a dressing of some small amount of driveway stone," which induced them to settle. Since the settlement agreement was entered into, the parties apparently have disagreed about the exact location of the expanded easement. William and Bonita contend that the settlement should be vacated based on Lemad's "misrepresentation" that led to the settlement.
William and Bonita also argue that they "never agreed to do more than some minimal maintenance work on the existing Echo Lane roadway," and the judge's statement at the hearing that they agreed to pay $2000 was an incorrect recitation from prior mediation discussions. Thus, the construction and cost of an entirely new roadway was not part of the agreement between the parties.
Lemad contends that the terms of the settlement were simple and straightforward and should be enforced. It asserts that there is no fraud or other compelling circumstances that would necessitate overturning the settlement, which was freely and voluntarily entered into by William, a professional surveyor, and Bonita.
We begin with a review of the well-established legal principles governing settlements. There is a strong public policy in favor of enforcing settlement agreements, which is "based upon 'the notion that the parties to a dispute are in the best position to determine how to resolve a contested matter in a way which is least disadvantageous to everyone.'" Brundage v. Estate of Carambio, 195 N.J. 575, 601 (2008) (quoting Peskin v. Peskin, 271 N.J. Super. 261, 275 (App. Div.), certif. denied, 137 N.J. 165 (1994)). Settlements will usually be enforced "'absent compelling circumstances.'" Ibid. (quoting Nolan v. Lee Ho, 120 N.J. 465, 472 (1990)). "Consequently, courts 'strain to give effect to the terms of a settlement wherever possible.'" Jennings v. Reed, 381 N.J. Super. 217, 227 (App. Div. 2005) (quoting Dep't of Pub. Advocate v. N.J. Bd. of Pub. Utils., 206 N.J. Super. 523, 528 (App. Div. 1985)).
A settlement agreement is governed by principles of contract law. Brundage, supra, 195 N.J. at 601 (citing Pascarella v. Bruck, 190 N.J. Super. 118, 124-25 (App. Div.), certif. denied, 94 N.J. 600 (1983)). Indeed, "[a]n agreement to settle a lawsuit is a contract which, like all contracts, may be freely entered into and which a court, absent a demonstration of 'fraud or other compelling circumstances,' should honor and enforce as it does other contracts." Pascarella, supra, 190 N.J. Super. at 124-25 (quoting Honeywell v. Bubb, 130 N.J. Super. 130, 136 (App. Div. 1974)). A court may not set aside a settlement agreement absent fraud or other misdeeds, unless the parties clearly expressed in the agreement that rescission was an available remedy for a breach. Kaur v. Assured Lending Corp., 405 N.J. Super. 468, 476-78 (App. Div. 2009).
"Where the parties agree upon the essential terms of a settlement so that the mechanics can be 'fleshed out' in a writing to be thereafter executed, the settlement will be enforced notwithstanding the fact the writing does not materialize because a party later reneges." Lahue v. Pio Costa, 263 N.J. Super. 575, 596 (App. Div.), certif. denied, 134 N.J. 477 (1993); see also Pascarella, supra, 190 N.J. Super. at 124 (noting that the fact that a settlement was made orally "is of no consequence"). Indeed,
if the agreement is silent as to a circumstance which thereafter arises, the parties may not be left without an agreement. So long as the parties intended to be bound by their agreement and a court is able to fill any gaps necessary to achieve a fair and just result, the contract may be modified by the addition of reasonable terms.
[Aarvig v. Aarvig, 248 N.J. Super. 181, 186 (App. Div. 1991) (citing Paley v. Barton Sav. & Loan Ass'n, 82 N.J. Super. 75, 83 (App. Div. 1964)).]
Where parties have agreed to the terms of a settlement, "second thoughts are entitled to absolutely no weight as against our policy in favor of settlement." Dep't of Pub. Advocate, supra, 206 N.J. Super. at 530.
Here, the essential terms of the agreement are the location and width of the new easement. Those terms were clearly and unambiguously laid out in the record and therefore we decline to disturb them. See Schor v. FMS Fin. Corp., 357 N.J. Super. 185, 191 (App. Div. 2002). They will be enforced as agreed. We discern no fraud, misrepresentation or other misdeeds that warrant vacating the settlement agreement. See Kaur, supra, 405 N.J. Super. at 476-78. That William and Bonita have now second guessed their entry into the settlement does not warrant its reversal. See Dep't of Pub. Advocate, supra, 206 N.J. Super. at 530. Moreover, if the terms are not clear or the agreement was breached, defendants may seek relief from the court without being entitled to rescission of the agreement. See Kaur, supra, 405 N.J. Super. at 476-77.
As to the cost of the establishment of the new easement, the settlement specifically provided that all parties who are beneficiaries to the easement have the nonexclusive responsibility to maintain the roadway. Additionally, at the hearing on the settlement agreement, when discussing the terms, the following colloquy occurred
Mrs. B. Honachefsky: Are we going to take the whole financial burden then?
The Court: Well, Mr. Honachefsky said that he thought he could do it for $2,000, which is, you know a small amount to pay for what you are getting in return which is the 4.59 feet. The extra footage in the easement, as well as your ability to grade the property so it doesn't flow on your property or your mother's property or anybody else's property anymore. And Mr. Honachefsky I think knows how to do this.
Mrs. B. Honachefsky: Is that what you want, Bill?
Mr. W. Honachefsky: That is fine.
Thus, the terms surrounding the cost of establishing the expanded easement were specifically delineated. Again, if additional issues arise that were not anticipated when the settlement was reached, the appropriate remedy is not to vacate the agreement; rather, the agreement may be modified with the addition of reasonable terms. See Aarvig, supra, 248 N.J. Super. at 186. Defendants are free to go back to the trial court to seek the addition of reasonable terms.
William and Bonita also argue that the litigation was fatally flawed by Lemad's failure to join the State of New Jersey as required by Rule 4:28-1 because it was an essential third party. They also assert that the failure to include the Aguirres, their successors in title, Irene, or the State of New Jersey in the settlement agreement renders it inequitable as William and Bonita are "at substantial risk of singularly incurring double or multiple obligations meant to be shared by all users of Echo Lane."
These arguments are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). Suffice it to say that the settlement agreement is a binding contract between Lemad and William and Bonita which leaves the easement rights of others undisturbed. Lemad's failure to join the State is of no consequence as the State's original easement will remain intact and the State will continue to have access to Echo Lane through its deeded easement.
1 We will refer henceforth to Irene, William, and Bonita Honachefsky by their first names to avoid confusion. We mean no disrespect.
2 This easement was deeded from Irene to her son and his wife, William and Bonita, in 1973. It was also deeded to the Aguirres in 2003 by the previous owners of lot 5. The State of New Jersey acquired a ten-foot wide easement over Echo Lane in 1959 when it acquired land to construct the Spruce Run Reservoir.
3 On October 9, 2012, William and Bonita wrote a letter to Judge Wilson expressing their concern over how the settlement terms were being carried out. They claimed that the new fourteen foot easement did not fully encompass the existing physical Echo Lane roadway. They alleged that the new easement would require extensive clearing of vegetation and slope stabilization. Moreover, they stated that the agreement was deficient as it failed to provide for who would be responsible for constructing the new road alignment. They did not file a motion to clarify, enforce or vacate the agreement.
4 Irene subsequently passed away on May 22, 2013.