RAWALD v. Sea Crest Construction Corp., et al., Defendants–Respondents. (2021)

Order, Supreme Court, New York County (Gerald Lebovits, J.), entered on or about February 18, 2021, which denied plaintiffs’ motion to enforce a settlement agreement, unanimously reversed, on the law, without costs, and the motion granted.

This appeal arises out of an alleged agreement by which plaintiffs’ counsel and counsel for defendants Sea Crest Construction Corp. and Peter Scalamandre & Sons, Inc. (together, Sea Crest) agreed to settle the underlying personal injury action for $275,000.  The settlement agreement was stated in an email communication in which plaintiffs’ counsel stated, “This is to confirm settlement in the sum of $275,000.  Please send release language and parties to be released.”  Later that day, plaintiffs’ counsel sent a follow-up email, stating, “Please confirm we are settled.”  Sea Crest's counsel responded, “Confirmed.  I'll have release information to you ASAP.” However, shortly after the parties agreed to settle plaintiffs’ clams, they learned that the summary judgment motions filed by all defendants in the action had been granted and the action had been dismissed.  Sea Crest then disavowed the settlement.  Plaintiffs sought enforcement of the settlement agreement, and Supreme Court denied that relief, finding that the settlement agreement did not contain all material terms of the settlement and had not been subscribed for purposes of CPLR 2104.

Plaintiffs established prima facie that the parties had an enforceable settlement agreement by submitting emails from Sea Crest's counsel agreeing to the settlement (see Bonnette v. Long Is. Coll. Hosp., 3 N.Y.3d 281, 286, 785 N.Y.S.2d 738, 819 N.E.2d 206 [2004]).  The emails, which reduced the settlement to a writing in accordance with CPLR 2104, were “subscribed” within the meaning of the statute, as the sender was identifiable and there was no contention that Sea Crest's counsel did not send any of the emails intentionally (see Matter of Philadelphia Ins. Indem. Co. v. Kendall, 197 A.D.3d 75, 80, 151 N.Y.S.3d 392 [1st Dept. 2021]).

The emails also contained all material terms, since the sole issue was how much plaintiffs would accept in settlement of their claim (id. at 81, 151 N.Y.S.3d 392).  Indeed, in emails leading up to the settlement, Sea Crest's counsel had stated that the other defendants were not interested in negotiating a settlement before Supreme Court's decision on the summary judgment motions, and that she had authority to settle the action on Sea Crest's behalf regardless of whether she later received contribution from the other defendants.

In opposition, Sea Crest did not submit evidence supporting its arguments that the agreement was not properly subscribed, or lacked material terms sufficient to constitute an enforceable agreement.