Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the Official Reports.
Gonzalez, P.J., Mazzarelli, Renwick, Richter, Gische, JJ.
Order, Supreme Court, New York County (Joan A. Madden, J.), entered June 29, 2012, which, to the extent appealed from, denied defendants' motion to dismiss plaintiffs' claims of employment discrimination, retaliation and hostile work environment, unanimously reversed, on the law, without costs, and the motion granted. The Clerk is directed to enter judgment dismissing the complaint.
In January 2009, plaintiffs were terminated from their positions as maintenance workers at defendant A.R.O. Construction Corp. Upon their discharge, plaintiffs each signed a Severance Agreement and Release that "release[d] and forever discharge[d] [A.R.O., its corporate affiliates, officers and employees] . . . from all claims[,] causes of action, grievances, and liabilities of any nature whatsoever that [plaintiffs] may now have or could have, . . . including without limitation any claims or liabilities arising pursuant to any employment relations statute, including all claims arising under . . . the New York State Human Rights Law [and] the New York City Administrative [C]ode."
The top of each page of the release bears the notation "BEFORE SIGNING THIS AGREEMENT, YOU SHOULD CONSULT AN ATTORNEY." The release explicitly states that it is executed voluntarily by plaintiffs with a full understanding of its terms, and after having the opportunity to obtain the advice of counsel. The release further notes that the parties intended it to be a "general release" effective to the fullest extent allowable by law.
The release states that plaintiffs had sufficient time to consider the terms, and each plaintiff acknowledged: "I HAVE READ AND UNDERSTAND THIS [RELEASE], THIS [RELEASE] IS WRITTEN IN TERMS THAT I UNDERSTAND, AND I AM AWARE THAT I MAY BE GIVING UP IMPORTANT RIGHTS." The release includes a "cooling off" clause which provides that plaintiffs could revoke the release during the seven-day period after signing it. In the release, plaintiffs state that they understand their right of revocation, and that if they choose not to exercise it during the seven-day period, the release would become effective and enforceable. It is undisputed that plaintiffs never exercised their revocation rights.
As consideration for the release, plaintiffs agreed to accept a severance payment in an amount equivalent to two weeks pay. In the release, plaintiffs acknowledge that they were not entitled to the severance payment other than by reason of the release, and that the payment constituted adequate consideration. Subsequent to signing the release, plaintiffs each received the full severance payments promised.
In December 2011, approximately three years after executing the releases and accepting the severance payments, plaintiffs commenced this action against A.R.O., its corporate parent and three of its officers or employees. The complaint asserts causes of action under the state and city human rights laws for race discrimination, retaliation and hostile work environment, and a claim for intentional infliction of emotional distress. The complaint does not contain any reference to the releases plaintiffs had signed.
On February 6, 2012, defendants moved to dismiss the complaint based on the releases (CPLR 3211[a]) and documentary evidence (CPLR 3211[a]). They also sought dismissal of the emotional distress claim on statute of limitations grounds (CPLR 3211[a]). In support of their motion, defendants submitted the signed releases, and payroll records showing that plaintiffs had received the severance payments. In their opposition, dated March 29, 2012, plaintiffs admitted that they had signed the releases, but contended for the first time that they were not enforceable because they were procured by duress and fraud. Plaintiffs did not dispute that they had received the severance payments. In reply, defendants argued that plaintiffs' allegations, even if true, do not sufficiently allege fraud or duress. In the alternative, defendants argued that plaintiffs had ratified the releases by accepting the severance payments and waiting almost three years before filing this action. The motion court dismissed the emotional distress claim, but denied the remainder of defendants' motion, finding issues of fact as to the validity of the releases [FN1]. The court did not address the ratification argument. Defendants now appeal.
The motion court should have dismissed the complaint in its entirety. "Generally, a valid release constitutes a complete bar to an action on a claim which is the subject of the release" (Centro Empresarial Cempresa S.A.
America Movil, S.A.B. de C.V., 17 NY3d 269, 276  [internal quotation marks omitted]). A release will not be treated lightly because it is a "a jural act of high significance without which the settlement of disputes would be rendered all but impossible" (Mangini v McClurg, 24 NY2d 556, 563 ). Where the language is clear and unambiguous, the release is binding on the parties unless it is shown that it was procured by fraud, duress, ...