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TORRES v. COSTICH

August 22, 1996

ABELINA MARQUEZ TORRES and FERNANDO GUZMAN MARQUEZ, Plaintiffs,
v.
RICHARD COSTICH and COSTICH BROTHERS, Defendants.



The opinion of the court was delivered by: LARIMER

 INTRODUCTION

 Plaintiffs, the widow and son of Heberto Guzman Ortiz ("Guzman"), commenced this action on October 6, 1992, to recover damages for Guzman's death in an accident in 1992, while Guzman was working as a laborer on defendants' farm. Plaintiffs asserted a claim under Migrant and Seasonal Agricultural Worker Protection Act ("AWPA" or "the Act"), 29 U.S.C. § 1800 et seq., and a claim under New York law for wrongful death.

 The parties entered into a stipulation of settlement that was executed on October 16, 1995. On October 23, 1995, I signed an order approving the settlement and entering judgment in favor of plaintiffs in the amount of $ 150,000. Among other things, the order stated that "defendants are ordered to pay to plaintiffs the sum of $ 10,000 in cash no later than November 12, 1995 ..." The order also stated that "this Court shall retain jurisdiction over the parties for the purposes of enforcing this Order and the terms of the Stipulation of Settlement." Based upon the settlement, the case was then closed.

 Plaintiffs have now moved to enforce the settlement agreement. Plaintiffs allege, and defendants admit, that defendants have not paid any part of the $ 10,000 that they were ordered to pay to plaintiffs.

 Defendants have cross-moved to vacate the settlement agreement, either in its entirety, or that portion of the agreement that provides for the $ 10,000 payment by defendants to plaintiffs. The basis for defendants' motion is that, although the settlement agreement says nothing about this subject, it was "understood" by the parties that the $ 10,000 payment was to be paid by the State Insurance Fund ("the Fund"). The Fund was not a party to plaintiffs' action in this court, but was the defendant in a declaratory judgment action by defendants in state court. Defendants state that the Fund had agreed to pay the $ 10,000 in exchange for releases from defendants as a settlement of the declaratory judgment action. Defendants allege that the Fund has now refused to pay the $ 10,000, and that defendants are financially unable to make the payment themselves.

 DISCUSSION

 I. Enforcement of the Settlement Agreement

 Under the Supreme Court's decision in Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375, 114 S. Ct. 1673, 128 L. Ed. 2d 391 (1994), "a federal court has jurisdiction to enforce a settlement agreement "only if the dismissal order specifically reserves such authority or the order incorporates the terms of the settlement." Scelsa v. City Univ. of New York, 76 F.3d 37, 40 (2d Cir. 1996) (citing Kokkonen, 114 S. Ct. at 1677). There is no question that both of those grounds for jurisdiction exist here. My October 23, 1995 order expressly contained the terms of the settlement and ordered defendants to pay plaintiffs $ 10,000. It also expressly stated that the court retained jurisdiction to enforce the settlement.

 "A settlement, once reached, is a binding contract." Reich v. Best Built Homes, Inc., 895 F. Supp. 47, 49 (W.D.N.Y. 1995) (citing Janneh v. GAF Corp., 887 F.2d 432, 436 (2d Cir. 1989), cert. denied, 498 U.S. 865, 112 L. Ed. 2d 141, 111 S. Ct. 177 (1990). Accordingly, a "settlement agreement is to be construed according to general principles of contract law." Rexnord Holdings, Inc. v. Bidermann, 21 F.3d 522, 525 (2d Cir. 1994).

 "It is settled that 'when parties set down their agreement in a clear, complete document, their writing should as a rule be enforced according to its terms. Evidence outside the four corners of the document as to what was really intended but unstated or misstated is generally inadmissible to add or vary the writing.'" AFA Protective Sys., Inc. v. Lincoln Sav. Bank, FSB, 194 A.D.2d 509, 598 N.Y.S.2d 543, 544 (2d Dep't 1993) (quoting W.W.W. Assocs., Inc. v. Giancontieri, 77 N.Y.2d 157, 162, 565 N.Y.S.2d 440, 566 N.E.2d 639 (1990)).

 In accordance with this rule, then, extrinsic or parol evidence may be admitted to explain a writing only when the terms of the writing are ambiguous. Investors Ins. Co. of America v. Dorinco Reinsurance Co., 917 F.2d 100, 104 (2d Cir. 1990). As long as the terms of the contract are unambiguous, extrinsic evidence will be precluded. Id. ; Lipsky v. Commonwealth United Corp., 551 F.2d 887, 896 (2d Cir. 1976). If the language of the contract is clear and unambiguous, a court can interpret the contract as a matter of law. Hunt Ltd. v. Lifschultz Fast Freight, Inc., 889 F.2d 1274, 1277 (2d Cir. 1989). Whether an ambiguity exists in a contract is a question of law to be resolved by the Court. Brass v. American Film Technologies, Inc., 987 F.2d 142, 149 (2d Cir. 1993); Curry Rd., Ltd. v. K Mart Corp., 893 F.2d 509, 511 (2d Cir. 1990); Van Wagner Advertising Corp. v. S & M Enters., 67 N.Y.2d 186, 191, 501 N.Y.S.2d 628, 492 N.E.2d 756 (1986).

 The language of the settlement agreement, and of the order incorporating its terms, is not ambiguous in the least. The stipulation of settlement states that "defendants will pay to plaintiffs the sum of $ 10,000 in cash no later than November 12, 1995." Nothing could be clearer.

 There is also nothing to suggest any ambiguity concerning whether the $ 10,000 was to be paid by the Fund. ...


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