| Cervera v Bressler |
| 2011 NY Slip Op 05216 [85 AD3d 839] |
| June 14, 2011 |
| Appellate Division, Second Department |
| Frank Cervera, Appellant, v Rossanna Bressler,Respondent. |
—[*1] Dewbury & Associates, P.C., Carmel, N.Y. (Stamatia Dewbury of counsel), forrespondent.
In a matrimonial action in which the parties were divorced by judgment dated February 21,2001, the plaintiff appeals, as limited by his brief, from stated portions of an order of theSupreme Court, Westchester County (Scarpino, Jr., J.), entered August 27, 2009, which, interalia, denied, without a hearing, those branches of his motion which were (a) to vacate that portionof the parties' so-ordered stipulation dated July 19, 2004, whereby the plaintiff waived his right toseek an attorney's fee and reapportionment of fees of the court forensic evaluator and theAttorney for the Child up to the date of the stipulation, and (b) to award him an attorney's fee inthe sum of $113,628.77, forensic evaluation fees in the sum of $7,700, and fees for the Attorneyfor the Child in the sum of $3,300, all for services rendered from April 2002 until the date of thestipulation.
Ordered that the order is modified, on the law and the facts, by deleting the provision thereofdenying those branches of the plaintiff's motion which were to vacate that portion of the parties'so-ordered stipulation dated July 19, 2004, whereby the plaintiff waived his right to seek anattorney's fee and reapportionment of fees of the court forensic evaluator and the Attorney for theChild up to the date of the stipulation, and to award him an attorney's fee in the sum of$113,628.77, forensic evaluation fees in the sum of $7,700, and fees for the Attorney for theChild in the sum of $3,300, all for services rendered from April 2002 until the date of thestipulation; as so modified, the order is affirmed insofar as appealed from, with costs to theplaintiff, and the matter is remitted to the Supreme Court, Westchester County, for furtherproceedings consistent herewith.
Since the parties' divorce in February 2001, they have been involved in litigation concerningcustody of their child, visitation rights of the noncustodial father, and the apportionment of costsand expenses, including forensic evaluation fees, an attorney's fee, and fees for the Attorney forthe Child, incurred in the course of the litigation. This appeal concerns only the issue of fees andcosts.
Pursuant to this Court's decision and order dated April 15, 2008 (Cervera v Bressler, 50 AD3d 837[2008]), a hearing was commenced on June 10, 2008, before Special Referee Reynold Snyder, toconsider the parties' relative financial positions and address the father's applications forreapportionment of the parties' respective obligations for payment of fees of the forensicevaluator and the Attorney for the Child from the 50/50 apportionment originally agreed to, andfor an award [*2]of an attorney's fee. While that hearing, whichconcluded sometime in October 2009, was ongoing, the father moved, inter alia, to vacate certainportions of a so-ordered stipulation dated July 19, 2004 (hereinafter the stipulation), whereby thefather waived his right to seek an attorney's fee and reapportionment of fees and costs of thecourt forensic evaluator and the Attorney for the Child incurred up to the date of the stipulation,in connection with a custody dispute between the parties beginning in 2002. In support of themotion, the father argued that those portions of the stipulation should be vacated based upon newevidence discovered during the ongoing hearing regarding the parties' finances, that the motherhad misrepresented her finances in 2004. The father claimed that he had relied upon thosemisrepresentations in entering into the stipulation in which he agreed to waive his rights.
The Supreme Court, inter alia, denied that branch of the plaintiff's motion which was tovacate the aforementioned portions of the stipulation, determining that the claims regarding thestipulation and fees incurred in connection with the litigation resolved thereby, were barred bythe doctrine of collateral estoppel, that the father had failed to meet his burden of showing thatthe stipulation was the result of fraud or overreaching, or that its terms were unconscionable, andthat, in any event, even if the stipulation was proven to have been procured by fraud, the fatherhad ratified it by accepting its benefits for a period of more than five years. We disagree.
"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 duringlitigation" (Hallock v State of New York, 64 NY2d 224, 230 [1984]; see Sweeney v Sweeney, 71 AD3d989, 990 [2010]; Cohn v Cohn,15 AD3d 332 [2005]). "It is the party seeking to set aside the stipulation . . .who has the burden of showing that the agreement was the result of fraud, duress, oroverreaching, or that its terms were unconscionable" (Sweeney v Sweeney, 71 AD3d at992; see Rubin v Rubin, 33 AD3d983, 985 [2006]; Chambers vMcIntyre, 5 AD3d 344, 345 [2004]). However, "[a] stipulation of settlement should beclosely scrutinized" (Chapin vChapin, 12 AD3d 550, 551 [2004]; see Libert v Libert, 78 AD3d 790, 791 [2010]; Cruciata v Cruciata, 10 AD3d 349,350 [2004]).
Here, the father's allegations that he was induced by the mother's misrepresentations of herfinancial circumstances to enter into the stipulation pursuant to which he, inter alia, waived anyclaim of contribution towards his counsel fees and any claim of reallocation or reapportionmentof expert or Attorney for the Child fees, and agreed that any fees outstanding would be paidpursuant to the 50/50 apportionment put in place by previous orders of the court, were sufficientto warrant a hearing on the issue of whether those portions of the stipulation were fraudulentlyinduced. The father's allegations were supported by evidence, elicited at the hearing before theSpecial Referee regarding the financial circumstances of the parties, that the mother had assetsavailable to her in 2004 of at least $306,631, her husband's gross income as reported on theirjoint tax returns for 2004, as opposed to the $105,000 gross income reported on her statement ofnet worth dated May 3, 2004, the sole document provided by her at the time of the stipulation.Moreover, the mother's 2004 joint bank statements provided at the hearing before the SpecialReferee showed deposits totaling approximately $450,000 for that year, whereas the 2004statement of net worth was blank for "Total Cash Accounts."
Likewise, the Supreme Court erred in determining that the father was barred by the doctrineof collateral estoppel from litigating the issues of counsel fees and reapportionment of the parties'responsibilities for payment of fees incurred in connection with litigation from 2002 up to thedate of the stipulation. "In order to invoke the doctrine of collateral estoppel, (1) the identicalissue must have necessarily been decided in the prior [litigation] and be decisive of the present[motion], and (2) the party to be precluded from relitigating the issue must have had a full andfair opportunity to contest the prior determination" (Scartozzi v Potruch, 72 AD3d 787, 789 [2010]; see D'Arata vNew York Cent. Mut. Fire Ins. Co., 76 NY2d 659, 664 [1990]; Franklin Dev. Co., Inc. v Atlantic Mut. Ins.Co., 60 AD3d 897, 899 [2009]).
The issues regarding the fees incurred prior to the stipulation were never litigated, since thefather waived his right to do so by the stipulation at issue herein. Moreover, the Supreme Courterred in concluding that the father had "knowingly and voluntarily" waived his rights to [*3]litigate these issues, since the question raised by the new evidenceis precisely that, to wit, whether the father's waiver was knowing and voluntary, or whether it wasfraudulently induced by the mother's misrepresentations.
As to the father's right to move to vacate portions of the stipulation almost five years after thestipulation was entered into, "[a] waiver will not be inferred from mere silence or inaction. Awaiver requires that the party to be estopped be aware of certain facts and, being aware of them,elect not to take advantage of them" (Chapin v Chapin, 295 AD2d 389, 391 [2002][internal quotation marks and citations omitted]). "Moreover, estoppel will lie only where anindividual has accepted the benefits of an agreement" (Chapin v Chapin, 12 AD3d at 551;see Chapin v Chapin, 295 AD2d at 391; Savasta v 470 Newport Assoc., 180AD2d 624, 627 [1992], affd 82 NY2d 763 [1993]).
Here, since the father did not have express knowledge of the mother's assets until sometimeduring the hearing regarding the parties' relative financial positions, which commenced on June10, 2008, and concluded in October 2009, the father cannot be said to have waived his right toseek vacatur of the stipulation simply because his motion was brought almost five years after thestipulation was entered into (see Chapin v Chapin, 12 AD3d at 551). Moreover, contraryto the mother's contention and the Supreme Court's conclusion, there is no evidence that thefather enjoyed any "benefits" of the stipulation by foregoing a possible award of an attorney's feeor reimbursement of payment of fees based upon a reapportionment of the parties' responsibilitiesfor the same.
The plaintiff's remaining contentions are without merit.
Accordingly, the Supreme Court erred in denying, without a hearing, those branches of theplaintiff's motion which were to vacate that portion of the stipulation whereby the plaintiffwaived his right to seek an attorney's fee and reapportionment of fees and costs of the courtforensic evaluator and the Attorney for the Child up to the date of the stipulation, and to awardhim an attorney's fee for that period in the sum of $113,628.77, forensic evaluation fees for thatperiod in the sum of $7,700, and fees for the Attorney for the Child for that period in the sum of$3,300. The matter must be remitted to the Supreme Court, Westchester County, for a hearing todetermine whether the father's agreement to the subject portions of the stipulation wasfraudulently induced and, if so, whether he is entitled to an award of an attorney's fee and/orreapportionment of the parties' responsibility for the fees incurred in connection with thelitigation that was resolved by the stipulation. Covello, J.P., Eng, Leventhal and Cohen, JJ.,concur.