HOME INSURANCE COMPANY IN LIQUIDATION v. Certain Underwriters at Lloyd's, et al., Defendants. (2006)

Order, Supreme Court, New York County (Charles E. Ramos, J.), entered April 27, 2005, which denied plaintiff's motion to enforce its settlement agreement with defendant Accident and Casualty Insurance Company of Winterthur Switzerland, unanimously affirmed, with costs.

While there is no question as to plaintiff's right to recover from Winterthur the amount stated in the plain language of the Settlement Agreement, and indeed defendant does not deny plaintiff's right to recover such amount, final execution of the agreement should await a determination of Winterthur's claimed setoffs in plaintiff's liquidation (see generally Lyons v. Cates Consulting Analysts, Inc., 88 A.D.2d 526, 450 N.Y.S.2d 19 [1982], affd. 64 N.Y.2d 1025, 489 N.Y.S.2d 65, 478 N.E.2d 206 [1985] ), at which time plaintiff's recovery might be in the form of a credit for the amount in the agreement.   As the motion court held, the waiver against setoffs contained in the Settlement Agreement was limited to setoffs “arising out of or in connection with or in relation to the Faculatative Certificate and the Additional Faculatative Certificates with respect to the AT & T Settlement Agreement,” which are not the setoffs which defendant asserts.   Although Winterthur did not plead such setoffs in its answer, such lapse is excusable under the circumstances of this case where the Liquidation Order giving rise to the need to claim such setoffs was not rendered until after the filing of the note of issue in this action.