Bards of Acorn, LLC v Spartan Fitness & Mixed Martial Arts Gym, Inc. (2011 NY Slip Op 51325(U))

Bards of Acorn, LLC v Spartan Fitness & Mixed Martial Arts Gym, Inc.

2011 NY Slip Op 51325(U) [32 Misc 3d 131(A)]

Decided on July 8, 2011

Appellate Term, Second Department

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This opinion is uncorrected and will not be published in the printed Official Reports.

The Bards of Acorn, LLC, Appellant,

against

Spartan Fitness & Mixed Martial Arts Gym, Inc. and RICHARD LUGO, Respondents.

Appeal from an order of the District Court of Suffolk County, Second District (Stephen L. Ukeiley, J.), dated July 27, 2010. The order granted tenants' motion to mark a judgment satisfied.

ORDERED that the order is reversed, without costs, and tenants' motion to mark a judgment satisfied is remitted to the District Court for a determination de novo following a hearing.

In settlement of this nonpayment summary proceeding, the parties agreed, on October 20, 2009, that landlord would have a final judgment awarding it possession and the sum of $5,700, with execution of the warrant stayed until November 1, 2009 for tenants to vacate. Tenants moved out on October 31, 2009 and thereafter wrote to landlord, stating that they were surrendering their security deposit of $5,500 and enclosing a money order for $200, and demanding that landlord issue a satisfaction of the $5,700 judgment. When landlord refused to do so, tenants moved to mark the judgment satisfied in full. Landlord opposed the motion, asserting, among other things, that the $5,700 judgment amount already reflected a credit to tenants for their $5,500 security deposit. Tenants replied that landlord's claim was outside the four corners of the stipulation. Without holding a hearing, the District Court granted tenants' motion to mark the judgment satisfied.

When the language of a stipulation is ambiguous, extrinsic or parol evidence may be permitted to determine the parties' intent (Scherer v North Shore Car Wash Corp. 72 AD3d 927 [2010]). Here, landlord contends that the $5,700 judgment represented the remainder after the application of the $5,500 security deposit toward rent arrears of $10,200 plus $1,000 legal fees, while tenants claim that the stipulation is not ambiguous, and that landlord's version of the facts is outside the four corners of the stipulation and would not be admissible. The stipulation's silence with respect to the security deposit renders it ambiguous (see Belknap v Witter & Co., 61 NY2d 802 [1984]) since it cannot be determined from the written agreement itself whether the $5,700 judgment reflected a credit to tenants for the security deposit. Thus, extrinsic proof as to how the parties arrived at the $5,700 judgment amount is relevant and admissible to determine [*2]the parties' intent. Accordingly, the order is reversed and the motion remitted to the District Court for a determination de novo after a hearing.