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Inter-Reco, Inc. v. Lake Park 175 Froehlich Farm, LLC

Supreme Court of New York, Second Department

May 22, 2013

Inter-Reco, Inc., respondent,
v.
Lake Park 175 Froehlich Farm, LLC, et al., appellants. Index No. 14740/11

Hamburger, Maxson, Yaffe, Knauer & McNally, LLP, Melville, N.Y. (Lane T. Maxson and Andrew K. Martingale of counsel), for appellants.

Ira Levine, Great Neck, N.Y., for respondent.

WILLIAM F. MASTRO, J.P., JOHN M. LEVENTHAL, SANDRA L. SGROI, ROBERT J. MILLER, JJ.

DECISION & ORDER

In an action, inter alia, to recover the security deposit on a commercial lease, the defendants appeal from so much of an order of the Supreme Court, Nassau County (Jaeger, J.), entered April 17, 2012, as denied their motion to dismiss the complaint pursuant to CPLR 3211(a).

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, and the defendants' motion to dismiss the complaint pursuant to CPLR 3211(a) is granted.

The plaintiff commenced this action, inter alia, to recover a security deposit pursuant to the terms of a commercial lease. The defendants moved to dismiss the complaint pursuant to CPLR 3211(a)(1) and (5) on the ground that the action was barred by a release contained within a stipulation of settlement previously entered into by the parties in connection with a summary eviction proceeding. The Supreme Court denied the defendants' motion, and the defendants appeal.

Public policy favors the enforcement of settlements (see Booth v 3669 Delaware, 92 N.Y.2d 934, 935), and a release is "a jural act of high significance without which the settlement of disputes would be rendered all but impossible" (Mangini v McClurg, 24 N.Y.2d 556, 563). Generally, a valid release constitutes a complete bar to an action on a claim which is the subject of the release (see Centro Empresarial Cempresa S.A. v América Móvil, S.A.B. de C.V., 17 N.Y.3d 269, 276; Global Mins. & Metals Corp. v Holme, 35 A.D.3d 93, 98), and should not "be converted into a starting point for renewed litigation" (Mangini v McClurg, 24 N.Y.2d at 563; see Centro Empresarial Cempresa S.A. v América Móvil, S.A.B. de C.V., 17 N.Y.3d at 276).

"[A] release is governed by principles of contract law" (Mangini v McClurg, 24 N.Y.2d at 562), and a release "that is complete, clear, and unambiguous on its face must be enforced according to the plain meaning of its terms" (Alvarez v Amicucci, 82 A.D.3d 687, 688; see Centro Empresarial Cempresa S.A. v América Móvil, S.A.B. de C.V., 17 N.Y.3d at 276; Booth v 3669 Delaware, 92 N.Y.2d at 935; Mangini v McClurg, 24 N.Y.2d at 563; Farrington v Harlem Sav. Bank, 280 NY 1, 4; Bank v Lake, 284 A.D.2d 355, 356; Sparacio v Sparacio, 283 A.D.2d 481, 483). "Whether or not a writing is ambiguous is a question of law to be resolved by the courts" (W.W.W. Assoc. v Giancontieri, 77 N.Y.2d 157, 162).

Here, the defendants established that the parties entered into a stipulation of settlement in which they "mutually released each other, their respective heirs, personal representatives, successors, and assigns... from all claims, demands, actions and causes of actions of every kind and nature whatsoever arising out of the subject lease." Contrary to the plaintiff's contention, the terms of the release clearly and unambiguously encompass this action inasmuch as the plaintiff's claim to the disputed security deposit is contingent upon the terms of the subject lease (see Alvarez v Amicucci, 82 A.D.3d at 688; Bank v Lake, 284 A.D.2d at 356; Sparacio v Sparacio, 283 A.D.2d at 483). Accordingly, the release executed by the plaintiff should be enforced according to its terms, and the Supreme Court should have granted the defendants' motion to dismiss the complaint on the ground that the action is barred by the release (see Booth v 3669 Delaware, 92 N.Y.2d at 935).

MASTRO, J.P., LEVENTHAL, SGROI and MILLER, JJ., concur.


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