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HENICK-LANE, INC. v. EL AL ISRAEL AIRLINES

United States District Court, S.D. New York


September 21, 2004.

HENICK-LANE, INC., Plaintiff,
v.
EL AL ISRAEL AIRLINES; MDM INTERNATIONAL; UNITED STATES FIDELITY & GUARANTY; AND, ST.PAUL SURETY, Defendants. EL AL ISRAEL AIRLINES, LTD., Third-Party Plaintiff, v. D.A.G. FLOORS, INC., OLYMPIC PLUMBING & HEATING CORP., NORLANDER CONTRACTING CORPORATION, L&L PAINTING CO., INC., BAYBRENT TILE CORP., BUCCO DEVELOPMENT, BERGEN CONCRETE CUTTING, INC., CERTIFIED GLASS CORP., INTERSTATE DRYWALL CORP., J&A CONCRETE CORP., McKEON ROLLING STEEL DOOR CO., TESTWELL LABS, INC., Additional Defendants on Interpleader Counterclaim.

The opinion of the court was delivered by: LEWIS KAPLAN, District Judge

SETTLEMENT AND RELEASE AGREEMENT

This Settlement and Release Agreement, dated as of September 2, 2004 (the "Settlement"), is entered into by and among D.A.G. Floors, Inc., El Al Israel Airlines, Ltd. ("El Al"), Henick-Lane, Inc. ("Henick-Lane"), L & L Painting Co., Inc., ("L & L Painting"), Norlander Contracting Corporation ("Norlander"), Olympic Plumbing & Heating Corp. ("Olympic"), USF&G/St.Paul Surety ("St. Paul Surety"; together, the "Parties"), through their undersigned attorneys.

  RECITALS

  A. On or about April 11, 2003, Henick-Lanc commenced an action against El Al, MDM International LLC ("MDM"), and St. Paul Surety in the Supreme Court of the State of New York (the "Supreme Court Action") to recover the unpaid portion, including accrued and accruing interest, under a construction contract made by MDM and Henick-Lane for work to be performed for El Al Airlines at JFK International Airport. B. On May 16, 2003, St. Paul Surety filed its Answer in the Supreme Court Action.

  C. On or about May 28, 2003, El Al Airlines Removed the Supreme Court Action to the United States District Court for the Southern District of New York (the "District Court."). Thereafter, on or about August 21, 2003, El Al Airlines in its Answer asserted an interpleader action through counterclaims, cross-claims and third-party claims in this Court (collectively, the "District Court Action") that named DAG, Olympic and Norlander as additional defendants.

  D. On June 2, 2003, MDM filed its Answer to the Complaint.

  E. On or about March 30, 2004, El Al filed an Amended Answer ("El Al Amended Answer") and added further additional defendants that included all of the defendants named in the caption.

  F. The following named parties failed to answer the El Al Amended Answer with interpleader claims before the time to do so expired and El Al entered default against each of the following entities; MDM, Baybrent Tile Corp., Bucco Development, Bergen Concrete Cutting, Inc., Certified Glass Corp., Interstate Drywall Corp., J & A Concrete Corp., Mckeon Rolling Steel door Co., and Testwell Labs, Inc. (together, the "Defaulting Interpleader Defendants").

  G. On or about July 30, 2004, El Al filed a notice of motion for partial summary judgment against St. Paul Surety. That motion has been held in abeyance pending the Parties' settlement discussions.

  H. On or before September 7, 2004, El Al Airlines served a notice of entry of default on each of the Defaulting Interpleader Defendants.

  I. The Parties desire to enter into this Settlement (i) to, settle disputes, claims, counterclaims, cross-claims and third party claims and related issues raised in the the District Court Action (ii) to provide for the distribution of $113,875 in "retainage" on deposit with El Al; (iii) to provide for the full and final discharge of El Al from all existing or future obligations or liabilities, if any, to the Parties and the Defaulting Interpleader Defendants; and (iv) to provide for the full and final discharge of St. Paul Surety from all existing or future obligations, if any, to the Parties under the particular "performance bond" and "payment bond," both bearing No. SC3572, issued by USF&G on behalf of MDM in connection with the underlying construction project (together, the "Surety Bonds").

  NOW, THEREFORE, in consideration of the above recitals and agreements set forth below, the sufficiency of which is expressly acknowledged, it is agreed as follows:

  1. Effective Date. This Settlement shall be effective on the date on which this Settlement is approved and entered on the docket in the District Court Action. 2. Discontinuance of Litigation. On the Effective Date, all claims, counterclaims, cross-claims and interpleader claims in this Action against the Parties to this stipulation shall be deemed dismissed with prejudice. Except for El Al's interpleader claims against the Defaulting Interpleader Defendants (which is or will be the subject of a motion for default judgment), all other claims against the Defaulting Interpleader Defendants shall be deemed dismissed without prejudice. Plaintiff shall file and circulate to all Parties a Stipulation of discontinuance promptly after receipt of the payment required to be made to it under Paragraph 3 below.

  3. Disbursement of Retainage and Settlement Payment. Within twenty (20) business days of the Effective Date, El Al shall cause to be delivered to each of the Parties attorney escrow checks or certified checks made payable as follows:

  Recipient Amount Paid To

 

D.A.G. Floors, Inc. $17,000.00 Jeffrey Cassuto, Esq. 350 Fifth Ave. Suite 6101 New York, New York 10118
EL Al Airlines $2,500.00 Biedermann, Hoenig, Massamillo & Ruff 90 Park Avenue New York, New York 10016
 
Henick-Lane, Inc. $52,875.00 Kahan & Kahan 1025 Westchester Ave. Suite 106 White Plains, N.Y. 10604
L & L Painting Co., Inc., $7,500.00 Ross & Cohen 711 Third Avenue New York, New York 10017
 
Norlander Contracting Corp. $17,500.00 Leonard Catanzaro 434 Broadway-Suite 900 New York, New York 10013
Olympic Plumbing & Heating Corp. $7,500.00 Cullen and Dykman Bleakley Platt 100 Quentin Roosevelt Blvd. Garden City, N.Y. 11530
 USF & G/St. Paul Surety $9,000.00 Wolff & Samson One Boland Drive West Orange, N.J. 07052 4. Releases. Except as set forth in Paragraph 5, below, on the Effective Date, the Parties shall hereby release and be deemed to release each other from any and all further claims, suits, actions, causes of action, debts, dues, sums of money, accounts, bonds, bills, covenants, contracts, controversies, agreements, promises, damages, judgments, executions and demands whatsoever, in law or equity, which the Parties ever had, now have or hereafter can, shall or may, have for, upon, or by reason of any matter, cause or thing whatsoever arising out of or in connection with any transaction or events arising in connection with Lawsuit. Upon approval of this Settlement, the Parties shall be deemed to have consented to (i) the entry of defaults against the Defaulting interpleading Defendants (ii) El Al's discharge from any and all existing and future obligations and or liabilities to the Parties and the Defaulting Interpleader Defendants in regards to the Retainage and the subject matter of the litigation; and (iii) St. Paul Surety's discharge from any and all existing and future obligations and or liabilities to the Parties arising under the Surety Bonds.

  5. No Release of MDM International. This Settlement is not intended to affect a release of obligations and/or liabilities of MDM or its principals to any of the Parties, including St. Paul Surety, whose rights and claims, contractual or otherwise, as against MDM and its principals, are expressly excluded from the scope of this Settlement and preserved.

  6. Authority. The Parties represent and warrant that they have the full authority to enter into and perform their respective obligations under this Settlement.

  7. Entire Agreement. The Settlement contains the entire agreement between the parties pertaining to the subject matter contained in this Settlement. This Settlement may only be modified in writing signed by the Parties or their duly appointed agents. All prior agreements and understanding between the Parties concerning the subject matter of this Settlement, with the exclusion of any agreement, including any agreement of indemnity, executed by MDM and/or its principals in favor of St. Paul Surety, are superceded by the terms of this Settlement. No waiver of any of the provisions of this Settlement shall be deemed to have occurred or be binding unless exccuted in writing by the party making the waiver.

  8. Jurisdiction. This Settlement shall be governed by and construed in accordance with the laws of the State of New York. The District Court shall retain jurisdiction over the Parties to interpret and enforce the terms of this Settlement.

  9. Successors. This Settlement and the covenants and recitals contained herein shall apply to, be binding upon, and inure to the benefit of the Parties' respective successors.

  10. Non Assignability. This Settlement is not assignable and the duties are not delegable. 11. Counterparts. The Settlement may be executed in separate counterparts and by facsimile, each of which shall be treated as an original, but all of which shall be one and the same document.

 [EDITORS' NOTE: SIGNATURES ARE ELECTRONICALLY NON-TRANSFERRABLE.] Kahan & Kahan

  Attorneys at Law

  1025 Westchester Avenue, Suite 106

  White Plains, New York 10604-3508

  Telephone: (914) 946-0115; Fax: (914) 946-0116

  FACSIMILE TRANSMISSION

  (PLEASE DELIVER AS SOON AS POSSIBLE)

 TO: Honorable Debra Freeman

 NUMBER: (212) 805-4258

 DATE: September 22, 2004

 COMMENTS:

FROM: Douglas Kahan, Esq Office Tel. No.: (914) 946-0115 Fax Tel. No.: (914) 946-0116
 PAGES: ___ 12 ___ (Including Cover Page) NOTICE OF MOTION FOR DEFAULT JUDGMENT

  PLEASE TAKE NOTICE, that upon the annexed Affidavit of Lawrence Mentz, Esq., sworn to on September 20, 2004, and the Exhibits annexed thereto, the Memorandum of Law submitted simultaneously herewith, and upon all the pleadings and proceedings heretofore had herein, the undersigned moves this Court for an Order, pursuant to Rule 55(b)(2) of the Federal Rules of Civil Procedure, granting default judgment to El Al Israel Airlines, Ltd. ("El Al") against Defendant MDM INTERNATIONAL LLC, and against Additional Defendants BAYBRENT TILE CORP., BERGEN CONCRETE CUTTING, INC., CERTIFIED GLASS CORP., INTERSTATE DRYWALL CORP., J&A CONCRETE CORP., McKEON ROLLING STEEL DOOR CO., and TESTWELL LABS, INC., along with such other and further relief as the Court deems proper.

20040921

© 1992-2004 VersusLaw Inc.



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