In this plenary action and upon the foregoing papers, plaintiff, Marika Cherfas, moves for a restraining order prohibiting defendant, Walter Wolf, from enforcing the provision of the parties' stipulation of settlement, judgment of divorce and amended stipulation of settlement. Defendant, Walter Wolf, opposes plaintiff's application and cross moves pursuant to CPLR 3211 (a) (1) to dismiss plaintiff's application based upon documentary evidence.

The parties were married on June 18, 1994. There are two (2) children of the marriage; 12 and 9 years of age. During the marriage, plaintiff, a physician, established a medical practice corporation under the name Professional Medical Arts, P.C. Defendant worked within the practice during the marriage, primarily responsible for billing and office management. Defendant left the employ of plaintiff's practice in [*2]November 2000. Thereafter, an action for divorce was commenced April 12, 2001.

A preliminary conference was held before this court wherein a discovery schedule was established and neutral appraisals were appointed, specifically for plaintiff's medical practice and degree. During the litigation, plaintiff also retained her own expert for the purposes of valuation of her practice and degree. The neutral appraiser's final valuation opined that the value of the practice at $1,030,000 and plaintiff's enhanced earning capacity based upon her degree at $248,000. These numbers were taken into consideration and relied upon by the parties for purposes of the stipulation of settlement. Plaintiff retained the service of two separate law firms during this litigation. Trial dates were set by the court, wherein immediately prior thereto, the parties entered into a stipulation of settlement on August 11, 2004, which resolved all issues. Pursuant to the stipulation of settlement, defendant was to receive a distributive award in the amount $832,500; $700,000 was to be paid by October 11, 2004, ($676,000 to the United States District Court, $13,733.30 to the Internal Revenue Service and $5,553.25 to the New York State Department of State) and the remaining balance in the amount of $150,000 was to be paid to defendant in installments by June 30, 2006. The judgment of divorce was signed on November 8, 2004, wherein it was stated that the stipulation of settlement was to survive and not merge with the judgment. Defendant brought an order to show cause for contempt against plaintiff which was resolved, on consent, by stipulation on January 10, 2006. Pursuant to the parties' amended stipulation, plaintiff was to pay $803,176.75 on or before June 15, 2006. In the event payment was not made, plaintiff was to vacate the Corbin Place first floor apartment, relinquishing the property to defendant. Thereafter, defendant brought another post judgment application seeking a writ of eviction or an order to compel plaintiff to comply with the parties' amended stipulation of settlement. Defendant is now in possession Corbin Place apartment.

In March 2007, plaintiff brought the within plenary action alleging the parties' stipulation of settlement entered into on August 11, 2004, and the amended stipulation of settlement enter into on January 10, 2006, should be set aside due to mutual mistake in the parties' reliance on an incorrect valuation of her medical practice or fraud of defendant. She contends that defendant, while in her employ, instituted improper billing procedures which later resulted in drastically reduced fees from medical insurance companies. Plaintiff contends that she is unable to comply with the terms of the parties' stipulation of settlement because of the marked decrease in income from her medical practice which, she asserts, resulted from billing by defendant and the subsequent billing assistant trained by defendant.

Plaintiff received a letter from Group Health Incorporated ("GHI"), an insurance provider for which she is a participating doctor, dated March 22, 2006.^[FN1] The [*3]letter explained the actions taken by GHI wherein they conducted an audit of claims submitted for billing related to fifteen patients for the period of 1999 through 2003. Based upon their audit, GHI is seeking a total amount of $1,295,812.32 in reimbursement from plaintiff. GHI's audit finding report reveals four (4) primary issues which lead to their request for reimbursement. First, GHI found that plaintiff billed for unnecessary and undocumented laboratory testing/pathology. They contend that a service must be medically necessary and documented in the patient's chart. GHI further stated that "[i]n all patient charts reviews, a comparison between the patient chart, diagnosis and lab test result revealed that numerous questionable tests we performed, while other findings were overlooked". Based upon these "findings" GHI seeks $285,187.67 in reimbursement. GHI's second finding is that plaintiff's billing for a Duplex Scan was conducted in nearly every case where the patient presented with a chief complaint of abdominal pain of an unknown etiology. The GHI letter further stated "it is not clear from the [GHI's] consultants expert opinion, that these [Duplex Scan] tests were necessary" and therefore they seek reimbursement in the amount of $687,210.90. The third finding was lack of medical necessity for multiple procedures wherein they seek reimbursement for overpayment in the amount of $300,896.49. The fourth and final finding by GHI was undocumented services for multiple procedures. Some of the procedures for which plaintiff submitted claims were not documented in the medical file and therefore, GHI seeks reimbursement for overpayment in the amount of $93,933.26.

In reliance on GHI's requests for reimbursement, plaintiff now brings the within plenary action to set aside the parties' stipulation and amended stipulation of settlement and requests a stay of enforcement of the parties' stipulation and amended stipulation of settlement until such time as this plenary action is litigated. Plaintiff contends that defendant created this debt

Defendant cross-moves to dismiss the complaint pursuant to CPRL 3211 (a) (1), upon the basis of documentary evidence. Plaintiff contends that defendant created this very large debt in her name due to his billing practices. Defendant asserts that plaintiff's debt is unrelated to billing practices. Rather, he posits that GHI's claims for reimbursement are based upon plaintiff's decisions as a medical doctor. The proposed "findings" questioned the necessity of tests and the proper medical record documentation. Defendant further asserts that even hypothetically assumingthat GHI's "findings" for reimbursement were related to improper billing, defendant oversaw plaintiff's billing only until November 2000; GHI's "findings" are for the period of 1999 through 2003. Morever, plaintiff is the sole owner of the medical practice and yet she asserts that the over-valuation was defendant's responsibility. Defendant was simply an employee of plaintiff for less than half the period for which GHI conducted its audit. Furthermore, when the parties entered into the stipulation of settlement they were individually represented by counsel, and discovery and expert appraisals were conducted and reviewed. Defendant asserts that assuming the allegations in plaintiff's complaint are [*4]true, they fail to rise to level required to set aside the parties' stipulation of settlement. There is presently pending a hearing scheduled on the issue of contempt in the matrimonial action.

The documentary evidence submitted by defendant, namely GHI's audit "findings" report dated March 22, 2006, alleges that unnecessary and undocumented laboratory testing/pathology was conducted by plaintiff; the Duplex Scan was conducted in nearly every case where the patient presented with a chief complaint of abdominal pain of an unknown etiology wherein medical necessity was questioned; the lack of medical necessity for multiple procedures; and undocumented services for multiple procedures. The GHI audit finding is that the medical determinations, by way of testing (laboratory testing, pathology or scans), were found to lack medical necessity or that the doctor failed to maintain patients' records.

Plaintiff, Marika Cherfas, is the medical doctor and sole owner of the medical practice. In the complaint she alleges that due to improper billing procedures instituted by defendant and continued by his replacement, whom defendant trained, she received inflated fees from the medical carriers which later resulted in drastically reduced fees to plaintiff. She posits that defendant knew or should have known that the billing procedures were improper and inflated and would result in inflated fees and, ultimately, the health insurance companies would seek reimbursement. Plaintiff further contends that she would not have entered into the settlement agreement or the amended settlement agreement if she knew of the fraud she alleges defendant perpetrated upon her and her [*5]medical practice. This alleged fraud lead to an overvaluation of the practice that the parties relied upon for settlement. Plaintiff asserts she is unable to comply with the distributive award given the large claims for reimbursement.

In this case, the documentary evidence definitively contradicts plaintiff's factual allegations which is that defendant inflated his billing submissions from 1999 until November 2000. Furthermore, plaintiff contends defendant is responsible for the remaining reimbursement, from November 2000 through 2003, since he trained the subsequent employee that plaintiff placed in charge of billing responsibilities.

The GHI audit "findings" clearly place the impropriety in the hands of plaintiff. Contrary to plaintiff's assertions, the GHI's claim against her and her practice were the result of unnecessary procedures conducted and not over billing. Defendant, who is not a doctor, could not be accountable for what is clearly plaintiff's professional responsibility and decisions to conduct test and/or maintain records i.e., evaluating/ addressing the patients' medical needs . Plaintiff does not assert the possibility that the procedures deemed unnecessary by GHI were simply billed by defendant and were never performed or approved by plaintiff. The documentary evidence submitted conclusively disposes of the plaintiff's claim, and therefore, dismissal pursuant to CPLR 3211(a) (1) is warranted (see Berardino v Ochlan, 2 AD3d 556, 557 [2 Dept., 2003]).

Plaintiff's plenary action appears to be yet another attempt to circumvent the marital stipulation of settlement which the parties entered in August 2004 and the amended stipulation of settlement in January 2006 which resolved a defendant's prior order to show cause requesting plaintiff be held in contempt for violating the terms and conditions of the stipulation of settlement and the judgment of divorce. Plaintiff contends that she is unable to make payment pursuant to the agreement due to GHI's claims for reimbursement, however, the first payment was to be paid by October 11, 2004, seventeen (17) months prior to GHI's audit finding and demand for reimbursement dated March 22, 2006. To date no monies have been paid pursuant to the parties' distributive award, however, pursuant to the parties' amended stipulation of settlement, defendant, by way of eviction, is now in possession of the Corbin Place apartment 1B.

The Court of Appeals has held that,[s]tipulations of settlement are favored by the courts and not lightly cast aside (see Matter of Galasso, 35 NY2d 319, 321, 361 NYS2d 871, 320 NE2d 618). This is all the more so in the case of "open court" stipulations (Matter of Dolgin Eldert Corp., 31 NY2d 1, 10, 334 NYS2d 833, 286 NE2d 228) within CPLR 2104, where strict enforcement not only serves the interest of efficient dispute resolution but also is essential to the management of court calendars and integrity of the litigation process. Only where there is cause sufficient to invalidate a contract, such as fraud, collusion, mistake or accident, will a [*6]party be relieved from the consequences of a stipulation made during litigation (Matter of Frutiger, 29 NY2d 143, 149-150, 324 NYS2d 36, 272 NE2d 543). Neither court below found fraud, collusion, mistake or accident; nor can we conclude as a matter of law that such a showing was made.

Hallock v State of New York, 64 NY2d 224 485 NYS2d 510 [1984].

"Relief from a stipulation will be granted only upon a showing of good cause sufficient to invalidate a contract, such as fraud, overreaching, duress, or mistake." (see Hallock v State of New York, 64 NY2d 224, supra at 230, 485 NYS2d 510, 474 NE2d 1178; Town of Clarkstown v M.R.O. Pump & Tank, 32 AD3d 925, 822 NYS2d 576 [2 Dept., 2006]; Kazimierski v Weiss,33 AD3d 590, 821 NYS2d 466 [2 Dept., 2006]; Kelley v Chavez 33 AD3d 590, 821 NYS2d 466 [2 Dept., 2006]).

In the case at bar, plaintiff's complaint requests this court, in essence, undo

the parties' stipulation upon the basis of fraud. They were represented by numerous counsel, discovery was conducted and extensive painstaking negotiations occurred which led to the parties resolving all issues. The alleged fraud is baseless given the documentary evidence.

In Kojovic v Goldman, (35 AD3d 65 35, 823 NYS2d 35 [1 Dept., 2006]), an

action by plaintiff to set aside the parties' settlement agreement, the Appellate Division, First Department held that the lower court erred in denying defendant's motion to dismiss the complaint. Plaintiff in Kojovic claimed the settlement agreement was procured through fraud based on defendant's affirmative misrepresentation as to the liquidity of his equity in an "IT" company, and should therefore be rescinded. Defendant moved pursuant to CPRL 3211 (a) (1) to dismiss the complaint relying on settlement agreement waivers to further inquiry as to the valuation of the holdings. "[A] party may not challenge the validity of a settlement agreement based on a claim that she undervalued assets which, . . , were disclosed by her former spouse and known to her at the time" (Kojovic v Goldman, 35 AD3d 65, supra ; citing DiSalvo v Graff, 227 AD2d 298 [1 Dept., 1996]). In applying DiSalvo v Graff , to likewise dismiss the complaint, the Appellate Division, First Department emphasized the similar fact that in both cases plaintiff was represented by competent, independent counsel and "specifically acknowledged that she had made her own independent investigation of [the defendant's] business affairs and was waving further disclosure." (Kojovic v Goldman, 35 AD3d at 68 [2006], supra quoting DiSalvo, 227 AD2d at 298 [1996], supra ).

In the case at bar, the parties signed a waiver expressly acknowledging receipt and review of the valuation report. Furthermore, the parties expressly waived their right to perform any further evaluations. The parties were represented by independent legal counsel, and were aware that counsel made no representations as to the accuracy of the valuation. Plaintiff is the sole owner of the medical practice; as the owner [*7]and sole medical practitioner it is her obligation to oversee all aspects of the practice. Plaintiff employed defendant for medical billing with full knowledge that he was previously incarcerated for Medicare and Medicaid fraud. Assuming the allegations in the complaint are true, plaintiff and her medical practice received the benefit of the inflated billing. As an owner and operator of a business plaintiff had the duty and obligation to oversee all aspects. She accepted the monies paid by the medical insurance carriers. It should be noted that plaintiff did not reveal what steps, if any, she has taken to dispute the audit "findings" of GHI.

Moreover, the alleged mistake is not a basis to set aside the agreement in the face of the waivers the parties entered into in the stipulation of settlement. Whether or not the wife knew about the claim asserted by GHI at the time of the settlement is irrelevant since a change in circumstance is not a valid reason to set aside a waiver and settlement of equitable distribution. The Court of Appeals held in McFarland v McFarland (70 NY2d 916, 519 NE2d 303 [1987])

[e]ven assuming that the allegations of fraud and duress in plaintiff's complaint are technically sufficient to support a claim of rescission, those allegations do not rise to the level of gross inequity that might implicate New York's public policy. Thus, there is no basis here for a contention that recognition of the Dominican Republic divorce judgment-or of the incorporated separation agreement-would do violence to some strong public policy of this State' (Greschler v. Greschler, supra , at 376, 434 NYS2d 194, 414 NE2d 694).

The court further

note[s] that plaintiff was represented by independent counsel of her own choosing at the time she signed the separation agreement and that the agreement, while favorable to her former husband, is neither facially irregular nor unconscionable as that term has been defined in the case law (see, Levine v. Levine, 56 NY2d 42, 48, 451 NYS2d 26, 436 NE2d 476; Christian v. Christian, 42 NY2d 63, 71-73, 396 NYS2d 817, 365 NE2d 849). Under these circumstances, there was no error in the dismissal of plaintiff's complaint.

(McFarland v McFarland 70 NY2d 916, 519 NE2d 303 1987], supra ).

Contrary to plaintiff's claims, there are no disputed facts that must be resolved in order to dismiss the complaint. Plaintiff claims that the conflicting affidavits of the parties, as to whether defendant was solely in charge of billing, without review, as claimed by plaintiff, or that plaintiff herself was in control of the billing procedures, as claimed by defendant are conflicting claims of fact. However, this is an irrelevant characterization of the issue given that both parties agree that defendant was not solely in charge of the billing, without review, during the entire period of GHI's audit and the findings of the audit are sounded in unnecessary procedures. Equally unpersuasive is plaintiff's contention that Chapin v Chapin (12 AD3d 550 [2 Dept., 2004]), applies to the present case. In Chapin v Chapin , the court set aside a settlement agreement as the [*8]product of fraudulent inducement because the husband claimed to have virtually no assets and concealed the fact that he had purchased valuable real estate. Similar to Kojovic v Goldman (35 AD3d 65, supra ) and DiSalvo (227 AD2d 883, supra ) the instant case is readily distinguishable since Chapin involved the concealment of assets, not the valuation of an asset. Plaintiff was or should have been aware of the billing from her solely owned medical practice and, thus, had every opportunity to perform the necessary due diligence, which includes any potential liabilities. Defendant did not perform the tests or keep patient records. Therefore, Chapin is inapplicable to the present case because plaintiff could more easily ascertain the value, which includes assets, liabilities, and risk, of her own practice.

Inasmuch as plaintiff's action is dismissed, the application for a restraining order pending the determination of the within plenary action is academic and therefore, moot (People ex rel. A.E.F. ex rel. M.J.L.-F v. K.T.L. 40 AD3d 894, 835 NYS2d 730 [2 Dept.,2007]). Accordingly, plaintiff's application for a restraining order prohibiting defendant from enforcing the provision of the parties' stipulation of settlement, judgment of divorce and amended stipulation of settlement is denied. Defendant's cross motion pursuant to CPLR 3211 is granted in its entirety.

This shall constitute the decision and order of the Court.

E N T E R

HON. JEFFREY S. SUNSHINE

J. S. C.