Preliminary Conference is deemed a stipulation

Brooklyn Cancer Care Med., P.C. v Brooklyn Hosp. Ctr., 2018 NY Slip Op 08111 (2d Dept. 2018)

“We agree with the Supreme Court’s denial of the plaintiff’s motion to vacate the preliminary conference order to which the parties stipulated. A stipulation will not be set aside absent a showing of fraud, overreaching, mistake, duress, or similar circumstances”

A Preliminary Conference Order is now deemed a stipulation.

Stipulation not strictly enforced

RCS Recovery Servs., LLC v Mensah, 2018 NY Slip Op 07766 (2d Dept. 2018)

The Court really went out on a limb here and did the right thing.  Question – was it correct legally?  They said so.

(1) In 2007, the defendant borrowed $74,000 from the plaintiff’s predecessor-in-interest, Wells Fargo Bank, N.A., as evidenced by a note, which provided that he would repay the sum due, with interest at the rate of 9.5% per year. The defendant allegedly defaulted on the note on June 17, 2010, and this action ensued. On December 6, 2013, with the defendant’s consent, judgment in the total sum of $95,083.08 was entered in favor of the plaintiff and against the defendant.

(2)On July 2, 2014, the parties entered into a stipulation of settlement whereby the plaintiff agreed to accept the sum of $65,000 in full settlement of the judgment. An initial $5,000 payment was made on or about the date of the stipulation, and the remaining $60,000 was to be paid in monthly installments of $5,000, due on the 25th day of each month. The parties agreed that the judgment would remain as a lien on the defendant’s property until full payment of the amounts owed under the stipulation

(3)  After paying a total of $45,000 without incident, the defendant inadvertently missed a payment due on March 25, 2015. By letter dated April 7, 2015, the plaintiff notified the defendant that he was in default and informed him of its election to continue to enforce the judgment pursuant to the terms of the stipulation.  The defendant avers that he attempted, in good faith, to cure his default, but the plaintiff refused and insisted upon full payment of the amount owed under the judgment, which was more than double what was still owed under the stipulation.”

(4a) However, under the circumstances of this case, the Supreme Court should have granted the alternate branch of the defendant’s motion, which was, in effect, to preclude the plaintiff from enforcing the default provision of the stipulation without affording the defendant a reasonable opportunity to cure his default. “Under almost any given state of facts, where to enforce a stipulation would be unjust or inequitable or permit the other party to gain an unconscionable advantage, courts will afford relief” (Goldstein v Goldsmith, 243 App Div 268, 272; see Weitz v Murphy, 241 AD2d 547, 548; Bank of N.Y. v Forlini, 220 AD2d 377, 378).

(4b) Here, the defendant’s default was inadvertent and minor in nature when measured against the harsh result that would be obtained upon literal enforcement of the default provision in the stipulation (see Bank of N.Y. v Forlini, 220 AD2d at 378). Insofar as the plaintiff failed to offer the defendant any opportunity to cure his default before seeking to recover the full amount due under the judgment, the plaintiff’s conduct could be interpreted as an attempt to take advantage of a technical default to obtain payment of the far greater sum which the plaintiff had originally sought, but agreed to forgo as part of the settlement (compare Weitz v Murphy, 241 AD2d at 548-549 and Bank of N.Y. v Forlini, 220 AD2d at 378, with McKenzie v Vintage Hallmark, 302 AD2d 503, 504).

Look, it is a great case.  It definitely takes some of the sting out of inadvertent stupidity.


Interest when liability is stipulated

Mahoney v Brockbank, 2016 NY Slip Op 05630 (2d Dept. 2016)

“In short, we conclude that a stipulation as to liability does not trigger the accrual of prejudgment interest under CPLR 5002. Moreover, because the parties did not provide for prejudgment interest in their stipulation, the Supreme Court properly determined that prejudgment interest was to be computed from the date of the jury verdict on the issue of damages.”

When I read this case, all I thought is a rear-end collision  with serious injuries and a defendant stipulating to liability; the case takes 6 years to get to trial; and now, the plaintiff lost 54% interest on a case worth between $400,000-$800,000.  Is that stipulating away to malpractice?

Substantial compliance satisfied stipulation

Capitol Discount Corp. v McFarlane, 2016 NY Slip Op 50140(U)(App. Term 2d Dept. 2016)

“Relieving a party from enforcement of a stipulation of settlement is appropriate upon a finding of substantial compliance with the stipulation of settlement (see Rockaway One Co. v Williams, 3 Misc 3d 25, 27 [App Term, 2d Dept, 2d & 11th Jud Dists 2004]). Here, the record demonstrates that defendant had substantially complied with the stipulation of settlement. We conclude, under the circumstances presented, that the Civil Court did not improvidently exercise its discretion in conditionally granting defendant’s motion to vacate the judgment.”

You do not see this often.


Inability to pay will not allow vacatur of stipulation

Allstate Ins. Co. v McNeil, 2014 NY Slip Op 51875(U)(App. Term 2d Dept. 2014)

“Stipulations of settlement are favored by the courts and not lightly cast aside” (Hallock v State of New York, 64 NY2d 224, 230 [1984]). Patrick McNeil’s unsupported assertions of financial hardship do not constitute a valid ground to fail to comply with the so-ordered stipulation (see Glover v Sattan, 43 Misc 3d 132[A], 2014 NY Slip Op 50618[U] [App Term, 2d, 11th & 13th Jud Dists 2014]; see also Nash v Yablon-Nash, 61 AD3d 832 [2009]). We note that while Patrick McNeil had indicated, in support of his final application, that he was prepared to pay the amount he owed plaintiff pursuant to the stipulation, there is no evidence that he tendered any further payments.”

Stipulation does not serve as collateral estoppel

All Boro Psychological Servs., P.C. v Allstate Ins. Co., 2014 NY Slip Op 50870(U)(App. Term 2d Dept. 2014)

Remember the stipulation where the releasee agreed that the medical provider was properly formed and complied with all applicable licensing laws?  At some point, you might have signed one and rued the consequences for the carelesness.  Well, today, it is okay.

(1) “With respect to defendant’s cross motion, plaintiff contends that defendant is not entitled to any discovery regarding whether plaintiff is a professional service corporation which fails to comply with applicable state or local licensing laws (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]) because defendant previously entered into stipulations, in unrelated actions, which, among other things, stated that, as of the date the stipulations were entered into, plaintiff was “in full compliance with any licensing requirements affecting its right to obtain reimbursement under the applicable No Fault laws and regulations.” However, as the issue was [*2]resolved in a stipulation and not after it was actually litigated, the doctrine of collateral estoppel is inapplicable”

But the SIU file?  It is discoverable.

(2) “To avoid having to produce its SIU file, defendant had to establish that its SIU file was prepared solely for litigation (Landmark Ins. Co. v Beau Rivage Rest., 121 AD2d 98, 101 [1986]; see also Bombard v Amica Mut. Ins. Co., 11 AD3d 647 [2004]). As defendant failed to demonstrate that it had decided to deny plaintiff’s claims prior to commencing its investigation, the contents of defendant’s SIU file are not privileged and are discoverable (Bombard, 11 AD3d at 648).”

And of course, Mallela discovery is always allowed

(3) “Contrary to plaintiff’s contention, defendant sufficiently demonstrated that defendant’s discovery demands which concerned a Mallela defense are “material and necessary in the prosecution or defense of an action” (CPLR 3101 [a]; All Boro Psychological Servs., P.C. v Allstate Ins. Co., 40 Misc 3d 131[A], 2013 NY Slip Op 51124[U] [App Term, 2d, 11th & 13th Jud Dists 2013]; Medical Polis, P.C. v Progressive Specialty Ins. Co., 34 Misc 3d 153[A], 2012 NY Slip Op 50342[U] [App Term, 2d, 11th & 13th Jud Dists 2012]). Defendant further established its entitlement to depose Vladimir Grinberg and plaintiff’s owner, Dr. John Braun”

Mark it up, fax it back and see what happens

Preferred Servs. v Country Wide Ins. Co., 2012 NY Slip Op 22098 (App. Term 1st Dept. 2012)

“Upon receipt of plaintiff’s proposal, defense counsel made and initialed several handwritten changes to paragraph 2 of the document — addressing the consequences of a payment default on defendant’s part — with the changes designed to extend the time allotted to defendant to comply with the agreement’s payment terms and, more importantly here, to reduce defendant’s payment obligations in the event it failed to comply. So far as shown, plaintiff voiced no objection to the modifications proposed by defendant or took any other action in the case for a full six months after defense counsel marked up and returned the stipulation, until March 2009, when plaintiff entered judgment in accordance with the original terms of the stipulation favorable to it.

“since plaintiff itself acknowledges that the parties’ correspondence yielded an enforceable settlement agreement, we conclude that plaintiff, through “acquiescent conduct” (Eldor Contr. Corp. v County of Nassau, 272 AD2d 509 [2000]) — including its election to forego any further litigation activity on its no-fault claim — accepted and is bound by the stipulation’s revised terms”

Well, somebody figured out how to limit the liquidated damage provision portion of the stipulation…

Read the stipulation….

Grochowski v Fudella, 2010 NY Slip Op 01210 (4th Dept. 2010)

The world of summary jury trials.  Similar to many of the framed issue no-fault trials that occur everyday, the opposing sides in summary jury personal injury trials also stipulate to many different issues.  I think the drafters of the uniform rules on summary jury trials might have inadvertently omitted something, and an astute (or sneaky – take your pick) attorney took this omission and went to the bank with it.  See below:

“Plaintiff commenced this action seeking damages for injuries she sustained when her vehicle was rear-ended by a vehicle driven by defendant. Following a summary jury trial conducted pursuant to the parties’ stipulation in accordance with “the Summary Jury Trial Rules of the Eighth Judicial District,” the jury found in favor of defendant. Defendant appeals from an order granting plaintiff’s motion to set aside the verdict as against the weight of the evidence and for a new trial. We reject defendant’s contention that Supreme Court violated the terms of the stipulation in determining the motion. “A stipulation between parties is an independent contract subject to the principles of contract interpretation” (Matter of Black v New York State & Local Employees’ Retirement Sys., 30 AD3d 920, 920). Here, the parties stipulated that the issue of negligence would be submitted to the jury and that neither party would request the court to direct a verdict pursuant to CPLR 4401 on that issue. The stipulation is silent, however, with respect to motions to set aside the verdict as against the weight of the evidence pursuant to CPLR 4404, and thus the court properly concluded that the terms of the stipulation do not evince the intent of plaintiff to forego her right to move to set aside the verdict (see generally White v Winter, 28 AD3d 1148).”

Why would someone forgo the right to a directed verdict yet agree to weight of evidence review?  Could someone please help me.