O'Connell v Paris Maintenance Co., Inc.
Annotate this CaseDecided on April 13, 2007
Supreme Court, Kings County
Richard E. O'Connell, as Trustee in Bankruptcy of Ernest Springer and Gineene Springer, Plaintiffs,
against
Paris Maintenance Company, Inc., Defendant.
34556/2002
Donald Scott Kurtz, J.
Plaintiff moves for an order vacating the settlement of this action and restoring the case to the trial calendar. Defendant cross-moves for summary judgment on the ground that the parties entered into a binding settlement agreement. Additionally, should the Court decide not to enforce the settlement, then defendant asks the Court to consider the summary judgment motion which was "marked off calendar" when the case was marked settled.
On September 3, 1999, plaintiff allegedly slipped and fell in a bathroom which defendant was responsible for cleaning and maintaining. Plaintiff commenced this action by the filing and service of a Summons and Complaint on or about August 30, 2002. At the time the action was commenced, plaintiff was represented by Raphaelson Law Firm, P.C. On August 20, 2004, plaintiff filed a bankruptcy petition [*2](which was later dismissed on August 23, 2006). On November 22, 2004, plaintiff's counsel and defendant's counsel appeared for a mediation and the attorneys entered into a "binding agreement" whereby plaintiff purportedly agreed to settle this matter for $150,000.00, subject to an agreement by the Worker's Compensation carrier to reduce its lien. Thereafter, plaintiff discharged his attorney and hired new counsel, allegedly because plaintiff did not authorize his attorney to attend the mediation or settle the matter. Shortly after being retained, plaintiff's new attorney informed defendant's attorney that plaintiff did not intend to honor the settlement agreement. In the meantime, defendant's pending motion for summary judgment was adjourned several times until it was finally "marked-off" on February 4, 2005. On or about November 28, 2005, defendant's attorney obtained an Order to Show Cause to enforce the settlement. On December 15, 2005, the Court (Hurkin-Torres, J .) marked the motion "off-calendar" determining that is was moot and advising plaintiff's counsel to initiate the instant motion.
Plaintiff argues that the settlement is not binding because plaintiff had filed for bankruptcy prior to the mediation and a trustee was appointed in the bankruptcy proceeding. Once the petition was filed, only the trustee in bankruptcy had the actual authority to settle a personal injury action and execute a release. See 11 USCA §541(a)(1), §542(c); Jones v. Harrell 858 F2d 667(11th Cir 1988). Defendant does not dispute the fact that plaintiff filed for bankruptcy. However, defendant contends that it did not know that plaintiff filed for bankruptcy at the time of the mediation and settlement. It first learned of the bankruptcy proceeding sometime after February 4, 2005. Defendant argues that plaintiff's attorney had apparent authority to settle the case. Therefore, the settlement should not be vacated.
An attorney derives authority to manage the conduct of litigation on behalf of a client from the nature of the attorney-client relationship itself. See Hallock v. State, 64 NY2d 224, 230 (1984). However, without a grant of actual authority from the client, an attorney cannot compromise or settle a claim and settlements negotiated by attorneys without authority from their clients have not been binding. See Id.; Dayho Motel v. Assessor of Town of Orangetown, 229 AD2d 435 (2d Dept 1996); Melstein v. Schmid Laboratories, Inc., 116 AD2d 632 (2d Dept 1986). An attorney does not derive this power by virtue of his general retainer to compromise and settle his client's claim. See Nash v. Y and T Distributors, 207 AD2d 779, 780 (2d Dept 1994).
A party who relies on the authority of an attorney to settle an action in his client's absence deals with such an attorney at his own peril. See Slavin v. Polyak, 99 AD2d 466 (2d Dept 1984); Melstein v. Schmid Laboratories, Inc. 116 AD2d at 634. If the settlement is thereafter challenged, the relying party has the burden of establishing that the attorney's actions were, in fact, authorized. See Id.; Silver v. Parkdale Bake Shop, Inc., 8 AD2d 607 (1st Dept 1959). Essential to the creation of apparent authority are "words or conduct of the principal, communicated to a third party, that give rise to the appearance and belief that the agent possesses authority to enter into a transaction." Hallock v. State, 64 NY2d at 231; Empire Communications Consultants, Inc. v. Pay TV of Greater New York, Inc. 126 AD2d 598, 601 (2d Dept 1987). "The existence of apparent authority depends upon a factual showing that the third party relied upon the misrepresentation of the agent because of some misleading conduct on the part of the principal-not the agent." Id. quoting Ford v. Unity Hospital, 32 NY2d 464, 473 (1973). Therefore, in order for defendant to have reasonably relied upon an appearance of plaintiff's attorney's authority to settle this case at mediation, defendant would need to establish that the conduct of plaintiff himself created the apparent authority.
Defendant claims that at the mediation, plaintiff's prior attorney represented to Honorable Herbert J. Dillon that he was attending the mediation with his client's knowledge and consent. Additionally, plaintiff's attorney represented that he was authorized to enter into a binding settlement agreement. Defendant maintains that both parties entered into a post-mediation agreement. However, the agreement is signed by plaintiff's attorney and not plaintiff himself. It is clear that plaintiff's attorney cannot, by his own acts or representation of authority "imbue himself with apparent authority." Nash v. Y and T Distributors, 207 AD2d at 780, 781. Moreover, defendant never alleges any communication by the plaintiff himself which gave rise to the appearance of authority to settle this case. Therefore, defendant did not meet his burden. Accordingly, plaintiff's motion is granted and this case is restored to the trial calendar.
Defendant's cross motion to have the Court consider its motion for summary judgment made pursuant to CPLR §3212 is granted. The Court now turns to defendant's motion for summary judgment. "A defendant who moves for summary judgment in a slip-and-fall case has the initial burden of making a prima facie showing that it neither created the hazardous condition nor had actual or constructive notice of its existence for a sufficient length of time to discover and remedy it." Valdez v. Aramark Services, Inc., 23 AD3d 639 (2d Dept. 2005); Joachim v. 1824 Church Ave., Inc., 12 AD3d 409 (2d Dept. 2004); Flynn v. Fedcap Rehabilitation Services, Inc., 31 AD3d 602 (2d Dept. 2006). Only after the moving defendant has satisfied this threshold burden will the court examine the sufficiency of the plaintiff's opposition. See Winegrad v. New York University Medical Center, 64 NY2d 851, 853 (1985); Yioves v. T.J. Maxx, Inc., 29 AD3d 572 (2d Dept. 2006).
In support of its motion, defendant submits the examination before trial of its current manager, Jaime Ortiz. Admittedly, Mr. Ortiz began working for defendant in November of 1999 whereas the alleged accident occurred on September 3, 1999. Moreover, Mr. Ortiz could not say for certain whether the two male porters who were assigned to maintain the bathroom in question in November of 1999 were the same two porters who were responsible for maintaining the bathroom in September of 1999. Mr. Ortiz had no personal knowledge of the relevant facts or circumstances surrounding the accident. Moreover, defendant does not submit any evidence from either the manager or porters who were employed by defendant at the time of the alleged accident. Lack of notice cannot be established by merely pointing out gaps in the plaintiff's case and submitting no evidence to establish when the area where the accident occurred was last inspected or cleaned. See Cox v. Huntington Quadrangle No. 1 Co., 35 AD3d 523 (2d Dept. 2006); Elbert v Dover Leasing, LP., 24 AD3d 497 (2d Dept. 2005); Britto v. Great Atlantic & Pacific Tea Co., Inc., 21 AD3d 436 (2d Dept. 2005) (holding that defendant failed to meet their initial burden where they offered no evidence to establish when the area in question was last inspected or cleaned on the day of the plaintiff's accident.); Gerbi v. Tri-Mac Enterprises of Stony Brook, Inc., 34 AD3d 732 (2d Dept. 2006); Joachim v. 1824 Church Ave., Inc., 12 AD3d at 409.
Accordingly, defendant failed to demonstrate that it did not create the alleged dangerous and defective condition, or had actual or constructive notice of same and a reasonable time to undertake remedial measures. Since defendant has failed to establish its prima facie [*3]entitlement to judgment as a matter of law, it is unnecessary for the Court to consider plaintiff's opposition papers.
In view of the foregoing, defendant's motion for summary judgment is denied. This case is restored to the JCP calendar for May 16, 2007.
The foregoing shall constitute the Decision and Order of the Court.
DONALD SCOTT KURTZ
Justice, Supreme Court
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