By motion dated May 29, 2013, plaintiff moves pursuant to CPLR 3213, for an order granting summary judgment in lieu of complaint with regard to a stipulation of settlement made on the record in open court on January 10, 2012 in a prior proceeding for dissolution of D'Angelo Funeral Home, Inc., and Seneca Chapels, Ltd.

Plaintiff, Louis D'Angelo, and defendant Robert D'Angelo, [*2]are brothers, each of whom is a 50% shareholder in a family run funeral home business. The businesses known as D'Angelo Funeral Home Inc., and Seneca Chapels Ltd. located on Seneca Avenue in Ridgewood, Queens County, provide mortuary and funeral services.

In June 2011, the plaintiff filed a verified petition under Index No. 13427/2011 seeking dissolution of the two corporations alleging that there was internal dissension among the shareholders and that defendant, Robert D'Angelo was guilty of illegal, fraudulent or oppressive actions against the plaintiff Louis D'Angelo. On September 1, 2011, defendant Robert D'Angelo served an election to purchase plaintiff's 50% interest at their fair value and upon such terms and conditions as may be approved by the Court pursuant to BCL § 1118.

On January 10, 2012, the date of the trial of the dissolution proceeding, a settlement was reached between the parties and their respective counsel which was spread on the record in open court before Justice Darrell L. Gavrin. Pursuant to the stipulation, a copy of which was submitted herein by the plaintiff, in consideration of the exchange of mutual general releases and a discontinuance of that action and a related action filed under Index No. 11044/2011, defendant Robert D'Angelo agreed to purchase the plaintiff's shares of stock in both corporations for the sum of $1,3000,000.00. Defendant agreed to pay said sum by certified bank check within 90 days of the date of the stipulation which was April 10, 2012. Plaintiff agreed not to enter into a competing business within the City of New York for ten years. Following the recitation of the stipulation, both parties were fully allocuted on the record by Justice Gavrin and by their respective attorneys. Defendant, when questioned by his attorney, Albert Guadelli, Esq. stated under oath that he heard the stipulation read into the record, that he was in agreement with terms of the stipulation and was prepared to accept it in full settlement of the petition. Defendant further stated that he was satisfied with the legal services rendered by his attorney, that he discussed the terms of the settlement with his attorney, that he felt the settlement was fair and reasonable, and that counsel answered all his questions.

On April 9, 2012, one day prior to the due date for payment by the defendant of $1.3 million, Mr. Guadelli wrote a letter to the plaintiff's counsel stating that his client could not pay the sum previously agreed upon because he experienced difficulties in re-financing the property of Seneca Chapels. Counsel proposed a "substituted counteroffer" of $400,000 cash plus free and clear title to a certain property located at 66-01 77th Street, Maspeth New York, previously owned by his mother. He stated that the [*3]believed that the counteroffer satisfied the original stipulation of settlement dated January 10, 2012.

In response, the plaintiff determined that the "counteroffer" was unacceptable and demanded compliance with the terms of the original settlement agreement. As a result of the defendant's failure to pay the amount agreed upon within 90 days, plaintiff moved before Justice Gavrin for an order pursuant to CPLR 5003 granting entry of a money judgment in the amount of $1.3 million. Defendant cross-moved for an order appointing a judicial hearing officer to conduct a hearing as to the valuation of the two corporations or for an order vacating the stipulation of settlement on the grounds of unilateral mistake. Defendant stated that he was mistaken as to the proper valuation of the businesses and was also mistaken as to his belief that his inability to obtain financing would permit him to vitiate the settlement.

By decision and order dated November 7, 2012, Justice Gavrin denied the defendant's cross-motion to vacate the stipulation of settlement and also denied the plaintiff's motion for a money judgment. The court stated that the plaintiff complied with the terms and conditions of the stipulation by executing general releases and forwarding them to defendant's attorney. The court also held that the defendant had defaulted in his obligation to pay the amount agreed upon under the agreement. The court stated however, that the plaintiff's general release was incorrect in stating that the purchase price was to be paid by the corporations rather than by the defendant. The court stated that the plaintiff's sole recourse was to seek enforcement of the stipulation in a plenary action pursuant to CPLR 2104.

The court denied defendant's cross-motion to appoint a judicial hearing officer and to vacate the stipulation, holding that the matter was discontinued by the plaintiff and the agreement did not provide for reinstatement of the petition in the event the parties did not comply with its provisions. In addition, the court held that "the respondents failed to make a sufficient showing to vacate the stipulation of settlement and discontinuance based upon unilateral mistake." The court stated that the defendant should have been aware of the appraisals of the properties and personally consented to the terms of the stipulation in open court after conferencing and negotiating the terms in the presence of counsel and the court. In her decision, Justice Gavrin specifically stated that the settlement was binding upon the defendant notwithstanding his alleged error as to the value of his share of the business as his mistake was made in the absence of ordinary care. [*4]

In opposition, defendant, Robert D'Angelo, submits an affidavit dated June 27, 2013, stating that the instant motion for summary judgment should be denied because the plaintiff breached the contract by precluding his source of financing the settlement and secondly, because there was a miscommunication between the defendant and his counsel regarding an appraisal of the business. Defendant states certain actions on the part of plaintiff such as applying for an order of protection in Family Court disenfranchised certain relatives from whom he was going to borrow money and that "it was always understood and agreed that obtaining funding for any settlement was an implicit and necessary term of the agreement." With regard to the defense of mistake, defendant states that he received an appraisal in December 2011 stating that the total value of both companies was $1.2 million. Therefore, based on this appraisal, the maximum value of plaintiff's share would have been $600,000. He states that the stipulation was based upon "total confusion and disorientation on my part." He states that because of his disorientation he failed to communicate the correct appraisal to his attorney prior to settling the matter. He states he was nervous and intimidated in court and "there were substantial misunderstandings on my part about the settlement agreement." Counsel contends that the settlement agreement should be deemed unenforceable because it erroneously and mistakenly called for payment to the plaintiff of over twice the value of plaintiff's interest. Lastly, counsel states that the stipulation entered into in open court is not the proper subject of a motion for summary judgment in lieu of complaint pursuant to CPLR 3213.

In reply, plaintiff's counsel submits that the same arguments in opposition regarding unilateral mistake were made before Justice Gavrin who denied the defendant's prior cross-motion to vacate the stipulation on that ground. Counsel again argues that defendant was mistaken as to the value of the two corporations and that he mistakenly believed that the settlement was conditioned on his obtaining financing. The prior court ruled that the defendant was in default of his obligation and that he did not make a sufficient showing to vacate the stipulation on the ground of unilateral mistake. The court held that the defendant had the ability to know the amount of the prior appraisal and to communicate it to his attorney prior to agreeing to the terms of the stipulation. Therefore the court held that the settlement was binding on the defendant not withstanding his alleged error since the mistake, if any, was made in the absence of ordinary care.

Upon review of the plaintiff's motion for summary judgment, defendant's affirmation in opposition and plaintiff's reply [*5]thereto, this court finds as follows:

CPLR 3213 provides, in relevant part, that "when an action is based upon an instrument for the payment of money only or upon any judgment, the plaintiff may serve with the summons a notice of motion for summary judgment and the supporting papers in lieu of a complaint"

Here, the plaintiff established his prima facie entitlement to judgment as a matter of law by submitting a copy of the stipulation settling the dissolution proceeding which had been made on the record in open court before a Supreme Court Justice. The terms of the stipulation were placed on the record in open court and agreed to by each party in the presence of independent counsel and in the presence of the court. Each party affirmed the terms of the agreement and their understanding of it. The plaintiff submitted an affidavit asserting that the defendant failed to make payment of the amount agreement to within 90 days in accordance with the terms of the agreement (see Krape v PDK Labs, Inc., 34 AD3d 751 [2d Dept. 2006]; J.D. Structures, Inc. v Waldbaum, 282 AD2d 434 [2d Dept. 2001]). In addition, the defendant conceded he could not make the payment agreed upon and prepared a "substituted counteroffer" which was rejected by the plaintiff.

This court finds that the stipulation in which the defendant agreed to pay 1.3 million dollars to the plaintiff after making an election to purchase the plaintiff's shares in a dissolution proceeding constitutes an instrument for the payment of money only entered into in open court on the record in a proceeding in which all sides were represented by counsel. "Settlements entered into in open court are binding and are not lightly cast aside" (Matter of Arzillo, 223 AD2d 701 [2d Dept. 1996] citing Hallock v State of New York, 64 NY2d 224 [1984]; also see Matter of Jo D. Talbot, 104 AD3d 775 [2d Dept. 2013]; Singh v North Shore Univ. Hosp., 76 AD3d 1004 [2d Dept. 2010]). A stipulation is an independent contract which is subject to basic principles of contract law (see Vider v Vider, 46 AD3d 673 [2d Dept. 2007][a stipulation of settlement, entered into in open court, with the parties and counsel present, is enforceable as a contract]; Hannigan v Hannigan, 50 AD3d 957[2d Dept. 2008]). "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" (Hallock v State of New York, supra).

Thus, the burden shifted to the defendant to establish by admissible evidence the existence of a triable issue of fact with [*6]respect to a bona fide defense (see Sce v Ach, 56 AD3d 457 [2d Dept. 2008]; Quest Commercial, LLC v Rovner, 35 AD3d 576 [2d Dept. 2006]; Bank of NY v Vega Tech. USA, LLC, 18 AD3d 678 [2d Dept. 2005]).

In opposition, the defendant failed to raise a triable issue of fact with respect to a bona fide defense. Defendant claims that plaintiff breached the contract by precluding his ability to obtain financing. However, those claims are speculative at best, irrelevant to the proceeding, not supported by any evidence, and belied by the terms of the stipulation itself which does not include a provision making defendant's payment contingent upon his obtaining financing (see Scherer v North Shore Car Wash Corp., 72 AD3d 927 [2d Dept. 2010][when the intent of the parties can be gleaned from the face of the instrument, or from the clear language of the oral agreement, extrinsic evidence may not be considered]). Secondly, defendant claims that he made a mistake in agreeing to a stipulation when he possessed an appraisal which was for less than the amount he agreed to pay to the plaintiff. However, this defense of unilateral mistake was previously raised by defendant, ruled upon by Justice Gavrin and rejected by her as a basis to vacate the stipulation. Justice Gavrin's determination that defendant is in default and that his purported unilateral mistake was made in the absence of ordinary care is the law of the case (see Montoya v JL Astoria Sound, Inc., 92 AD3d 736 [2d Dept. 2012][where a party has had a full and fair opportunity to litigate an issue, but has received an adverse final ruling on it, that party is collaterally estopped from litigating the same issue in another proceeding]). Thus, this court finds that the defendant has failed to raise a question of fact as to a genuine defense towards his failure to make the payment required by the stipulation of settlement (see Gullery v Imburgio, 74 AD3d at 1022 [2d Dept. 2010]; Quest Commercial, LLC v Rovner, 35 AD3d 576 [2d Dept. 2006]; Hestnar v Schetter, 284 AD2d 499[2d Dept. 2001]; MDJR Enters. v La Torre, 268 AD2d 509 [2d Dept. 2000]).

Therefore, since the defendant failed to demonstrate, by admissible evidence, the existence of a triable issue of fact with respect to a bona fide defense, the plaintiff's motion for summary judgment in lieu of complaint is granted (see Webster v Murray, 70 AD3d 674 [2d Dept. 2010]; Corp. v Breskel Assocs., 238 AD2d 539 [2d Dept. 1997]).

Accordingly, it is hereby

ORDERED, that judgment is granted to the plaintiff against the defendant in the amount of $1,3000,000.00 plus interest from April 10, 2012. [*7]

Settle judgment on notice.

Dated: September 3, 2013

Long Island City, NY

______________________________

ROBERT J. MCDONALD

J.S.C.