The following named papers numbered 1 to 3

submitted on this Motion

on August 15, 2011

papers numbered

Notice of Motion and Supporting DocumentsOrder to Show Cause and Supporting Documents1

Opposition to Motion2

Reply Papers to Motion3

The respondents move by order to show cause to "vacate all stipulations" upon the grounds of a lack of jurisdiction, fraud and breach of contract. The petitioner opposes the instant motion. The respondents filed a Reply.

The procedural history is as follows:

The petitioner commenced this commercial non payment proceeding in October of 2010, to recover possession of the entire first floor of the First United Methodist Church located at 30 Union Place and White House Avenue, Roosevelt, New York, as [*2]well as a money judgment for rent and use and occupancy. The Notice of Petition and Petition were properly served upon Tot-Spot Inc., Michelle Miles and Valerie Chung in accordance with RPAPL §735.

All three respondents appeared in this proceeding by Donald Rollock, Esq. Rather than interpose an answer, this matter was resolved in Court on November 29, 2010, when the parties entered into a written stipulation of settlement. Pursuant to the stipulation respondents consented to the jurisdiction of the Court, to the entry of a judgment of possession and issuance of a warrant of eviction. Respondents further acknowledged owing rent arrears in the sum of $24,000.00 against the corporate tenant, Tot-Spot Inc. In addition, the issuance of the warrant of eviction was stayed until December 31, 2010, on condition that respondents make a payment of $3,000.00 on or before December 6, 2010. The stipulation was signed by both attorneys, as well as, by Valerie Chung on behalf of the respondents.

On or about January 5, 2011, Carrie Solages, Esq., of Solages and Solages, counsel for respondents, filed an order to show cause seeking to stay execution of the warrant of eviction. The respondents had fully complied with their payment obligations under the stipulation of settlement and the stay of the warrant was not premised on that basis. Rather, as a licensed day care center, the respondents claimed they were in jeopardy of losing their New York State License if they were forced to relocate without waiting a period of 60 days.

The order to show cause was signed by the undersigned. As a condition of remaining on the premises, the respondents were directed to deposit the sum of $6,000.00 with the Court on or before January 10, 2011. Said sum was timely deposited.

Thereafter, on February 7, 2011, the parties, through their respective attorneys, settled this matter with a second written "So Ordered" stipulation of settlement. The terms of the first stipulation of settlement were incorporated by reference into the second stipulation. The stipulation called for the immediate issuance of a warrant and a conditional stay of its execution provided that the respondents pay the sum of $3,500.00 per month for February, March, April, May, and June 2011. Moreover, the stipulation provided that in no event were respondents entitled to remain on the premises beyond June 30, 2011. The stipulation was signed by both attorneys, along with Michelle Miles, on behalf of the respondents.

The respondents have discharged their previous two attorneys and now hired David Bythewood, Esq. It is respondents' new attorney who has brought this Order to Show Cause to vacate "all stipulations" upon the grounds that (1) this Court lacks jurisdiction over respondents; (2) Valerie Chung lacked authority to enter into the first stipulation of settlement; (3) a 10 day notice to quit was not served; (4) fraud; and (5) breach of contract. The petitioner opposes the instant motion. [*3]

To begin with, any claim by respondents that this Court lacks jurisdiction whether subject matter or personal jurisdiction, lacks merit.

The Nassau County District Court has subject matter jurisdiction over all landlord-tenant matters in Nassau County, which includes the town of Roosevelt where the premises is located (see, UDCA §204).

UDCA §204 states:

The court shall have jurisdiction of summary proceedings to recover possession of real property located in whole or part within a district of the court in the county, to remove tenants therefrom, and to render judgment for rent due without regard to amount.

Thus counsel's motion for a dismissal based upon a lack of subject matter jurisdiction is denied.

Next, respondents move for an order dismissing this summary proceeding upon the grounds that this Court lacks personal jurisdiction over respondents. Counsel further argues that the stipulation of settlements should be vacated because respondents' first counsel neglected to raise certain defenses to this proceeding which he believes would have resulted in a dismissal of this action. In addition, counsel claims that Valerie Chung, lacked the authority to bind Tot-Spot, Inc., to any settlement agreement.

It is well settled that a defect in personal jurisdiction may be waived where a party submits to the jurisdiction of the Court and signs a stipulation of settlement (see, Lomando v. Duncan, 257 AD2d 649 [2d Dept 1999]; Textile Technology Exchange v. Davis, 81 NY2d 56; Revona Realty Corp., v. Wasserman, 4 AD2d 444; 34 Funding Associates v. Pollak, 26 AD3d 182 [1st Dept 2006]; Matter of Manufacturers Hanover Trust Co. v. Porcelli, 121 AD2d 384).

In the instant case, the respondents have not demonstrated a sufficient basis for this Court to vacate both stipulations of settlement. Whether the respondents had a viable defense to petitioner's claims is of no moment. Respondents waived those defenses by failing to allege them in an answer and by agreeing to settle this matter pursuant to two stipulations of settlement. The Court will not second guess the litigation strategy of both former attorneys who represented respondents in this proceeding.

Moreover, the stipulation of settlements are binding agreements which are clear on their face. The first stipulation included a clause stating that: "respondents appear in this proceeding and consent to the jurisdiction of this Court". Moreover, respondents never raised the issue of jurisdiction at any time before or during the signing of the stipulation. Thus, respondents have waived any jurisdictional defenses to any judgments that result from the stipulation of settlement (see, Gnosis, LLC., v. Soforte, [*4]LLC., 29 Misc 3d 1211[a] [Nassau Dist Ct 2010].

Moreover, a stipulation and order is a binding agreement between the parties to a dispute that is an enforceable contract (see, Nishman v. DeMarco, 430 NYS2d 339 [2d Dept 1980]; Viacom Corp. v. Board of Assessors, 744 NYS2d 539 [3d Dept 2002]). This Court has recognized that "[s]tipulations of settlement which put an end to litigation promote efficient dispute resolution and are essential to the litigation process" (Matter of Siegel, 5 Misc 3d 1017[A] [Nassau Sup Ct 2004], aff'd 29 AD2d 914 [2d Dept 2006]).

Therefore, "[a] party to a stipulation is not entitled to withdraw from its agreement unilaterally" (see, U.S. ex rel. Reilly v. New England Teamsters & Trucking Industry Pension Fund, 737 F2d 1274 [1984]). This is all the more so in the case of "open court" stipulations (Matter of Dolgin Eldert Corp., 31 NY2d 1 [1972]) 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 party be relieved from the consequences of a stipulation made during litigation (see, Matter of Frutiger, 29 NY2d 143, 149-150 [1971]). Moreover, "courts may not rewrite an agreement between parties" (see, Matter of Evans v. Board of Assessment Review of Town of Catskill, 284 AD2d 753, 755 [3d Dept 2001]) and "a court should not, under the guise of interpretation, make a new contract for the parties" (see, Sklerov v. Sklerov, 231 AD2d 622 [2d Dept 1996]). Furthermore, Courts will not set aside a stipulation merely because in "hindsight" a party decides that the terms of the stipulation were "improvident" (see, Town of Clarkstown v. M.R.O. Pump & Tank, 287 AD2d 497 [2d Dept 2001]).

Respondents further argue that Valerie Chung was not authorized to bind Tot-Spot, Inc., to the first stipulation of settlement. In support of this argument is the affidavit of Valerie Chung.

Ms. Chung states that she hired Mr. Rollack to represent respondents in this summary proceeding. She further states that she signed a retainer agreement with Mr. Rollack. She appeared in the landlord tenant part of this Court on November 29, 2010, and in an effort to settle this matter, with the advice of counsel, signed a stipulation of settlement.

Ms. Chung now states that upon hindsight, she did not understand what she was signing when she signed the stipulation. She further claims that she "had no idea what was going on" in court. In addition, she alleges that upon reviewing the retainer agreement she signed, her title as to her relationship with the corporation was mis-characterized. [*5]

To begin with, the Court finds that Valerie Chung's assertions that she is not authorized to bind Tot-Spot, Inc., is contrary to the evidence submitted by respondents. In support of the order to show cause, the respondents submit the lease agreement between First United Methodist Church of Roosevelt and Tot-Spot, Inc. [see, Respondents Exhibit "D"].

The lease agreement is signed in August of 2006, by Valerie Chung on behalf of Tot-Spot, Childcare, Inc. Thus, Ms. Chung's affidavit wherein she states that she has no authority to bind the corporate respondent lacks merit. Moreover, based upon the affidavit of Dermot Sutherland, all rent checks, the latest of which was tendered in June of 2011, were signed by Valerie Chung [see, Petitioner's Exhibit "E"]. In addition, as evidenced by the Sutherland affidavit, Ms. Chung tendered monthly rent payments pursuant to the stipulation of settlement. Thus, by her own conduct, she acquiesced to its terms.

Moreover, the Court further finds that Valerie Chung's assertions that she did not understand the terms of the stipulation of settlement lacks merit.

The Court of Appeals in Pimpinello v. Swift & Co. , 253 NY 159 [1930], held:

Ordinarily the signer of a deed or other instrument, expressive of a jural act, is conclusively bound thereby. That his mind never gave assent to the terms expressed is not material (Wigmore on Evidence, §2451). If the signer could read the instrument, not to have read it was gross negligence; if he could not read it, not to produce it to be read was equally negligent; in either case the writing binds him.

However, the Court of Appeals further held that there may be instances where the signer is not bound by the writing. The Court stated in relevant part that "[i]f the signor is illiterate, or blind, or ignorant of the alien language of the writing, and the contents thereof are misread or misrepresented to him by the other party, or even a stranger, unless the signer be negligent, the writing is void".

In the instant case, there is no allegation by Ms. Chung that she is illiterate, blind, or has no understanding of the English language. Quite the opposite is apparent from the record. In view of the foregoing, the Court finds no basis to set aside the first stipulation of settlement signed by Ms. Chung. Further respondents fail to demonstrate sufficient grounds such as fraud, collusion, mistake or accident to vacate the second stipulation of settlement.

The remaining contentions raised by respondents in their Order to Show Cause have been considered by the Court and are hereby denied.

In view of the foregoing, the stipulations and the terms thereunder remain in full force and effect. The petitioner is entitled to a judgement of possession and warrant of eviction without any further stays of this proceeding. [*6]

This Constitutes the Decision and Order of the Court.

So Ordered:

/s/ Hon. Scott Fairgrieve

DISTRICT COURT JUDGE

Dated:September 15, 2011