Argued-May 1, 2017
& Greenberg, LLP, New York, NY (Joshua M. D. Segal of
counsel), for appellant.
E. Anderocci, Brooklyn, NY, for respondent.
C. DILLON, J.P. SYLVIA O. HINDS-RADIX HECTOR D. LASALLE
FRANCESCA E. CONNOLLY, JJ.
DECISION & ORDER
action for a money judgment in the sum of $377, 147 for
failing to comply with a judgment of divorce, commenced by
motion for summary judgment in lieu of complaint pursuant to
CPLR 3213, the defendant appeals from an order of the Supreme
Court, Richmond County (Patel, Ct. Atty. Ref), dated October
14, 2015, which, after a hearing, denied his motion to vacate
a money judgment of the same court entered July 23, 2012,
which was in favor of the plaintiff and against him in the
principal sum of $97, 788, and for an award of attorneys'
fees pursuant to Domestic Relations Law § 237(b).
that the order is affirmed, with costs.
plaintiff commenced this action against the defendant
pursuant to CPLR 3213, seeking a money judgment in the sum of
$377, 147, after the defendant allegedly failed to fulfill
his obligations under the parties' judgment of divorce.
Thereafter, the parties entered into a stipulation of
settlement pursuant to which the plaintiff agreed to accept
the lesser amount of $159, 378.45, which the defendant agreed
to pay by a series of checks over a period of time. The
stipulation provided that "[i]n the event any one of the
checks is dishonored by defendant's bank ... defendant
then agrees to the immediate entry of a money judgment
against him." The default payment amount under the
stipulation was to be calculated according to a formula. The
defendant's bank dishonored one of the checks and, as a
result, the plaintiff entered a money judgment against the
defendant in the sum of $97, 788. Thereafter, the defendant
moved, inter alia, to vacate the money judgment, arguing,
among other things, that he was not in default of the
stipulation and that, even if he were, he was excused under
the doctrine of impossibility of performance. After a
hearing, the Supreme Court denied the defendant's motion.
a general rule, courts will not disturb the findings of a
referee as long as they are substantially supported by the
record and the referee has clearly defined the issues and
resolved matters of credibility. A referee's credibility
determinations are entitled to great weight because, as the
trier of fact, he or she has the opportunity to see and hear
the witnesses and to observe their demeanor" (Last
Time Beverage Corp. VF & V Distrib. Co., LLC, 98
A.D.3d 947, 950; see Matter of Filler v Schwimmer,
135 A.D.3d 766, 769). Here, we discern no basis in the record
to disturb the Special Referee's findings.
reject the defendant's contention that the default
payment required under the stipulation represents an
unenforceable penalty rather than liquidated damages, which,
although first raised on appeal, we reach as a question of
law which appears on the face of the record (see Bates
Advertising USA, Inc. v 498 Seventh, LLC, 7 N.Y.3d 115,
120; Pinos v Clinton Cafe & Deli, Inc., 139
A.D.3d 1034, 1035; Noghrey v Town of Brookhaven, 21
A.D.3d 1016, 1020). Liquidated damages constitute the
compensation the parties agree should be paid in the event of
a party's default (see 172 Van Duzer Realty Corp. v
Globe Alumni Student Assistance Assoc, Inc., 24 N.Y.3d
528, 536; Truck Rent-A-Ctr. v Puritan Farms 2nd, 41
N.Y.2d 420, 423-424). A liquidated damages clause is
enforceable "if the amount liquidated bears a reasonable
proportion to the probable loss and the amount of actual loss
is incapable or difficult of precise estimation"
(Markham Gardens, L.P. v 511 9th, LLC, 143 A.D.3d
949; see also G3 Purves St., LLC v Thomson Purves,
LLC, 101 A.D.3d 37, 41). "[T]he agreement should be
interpreted as of the date of its execution"
(Willner v Willner, 145 A.D.2d 236, 240; see
also J.R. Stevenson Corp. v County of Westchester, 113
A.D.2d 918, 921). Thus, "[t]he party challenging a
liquidated damages clause must establish that actual damages
were readily ascertainable at the time the contract was
entered into or that the liquidated damages were
conspicuously disproportionate to foreseeable or probable
losses" (United Tit. Agency, LLC v Surfside-3 Mar.,
Inc., 65 A.D.3d 1134, 1135; see also JMD Holdings
Corp. v Congress Fin. Corp., 4 N.Y. 3d 373, 380).
the defendant failed to submit any evidence demonstrating
that, at the time the parties executed the stipulation, the
plaintiff knew or could have known which, if any, of the
checks the defendant's bank would dishonor. Consequently,
the defendant failed to establish that the plaintiffs actual
damages in the event of a default were readily ascertainable
at that time (see JMD Holdings Corp., 4 N.Y.3d at
380; United Tit. Agency, LLC, 65 A.D.3d at 1135).
Moreover, the money judgment was calculated in accordance
with the parties' stipulation (see JMD Holdings
Corp., 4 N.Y.3d at 380). As such, the default payment
was virtually identical to the plaintiffs original claim, and
the defendant failed to establish that the plaintiff received
an undeserved gain (see id).
light of our determination, it is unnecessary to reach the
defendant's remaining contention that, in the event this
Court reverses the order appealed from, the matter should be
remitted for a determination of whether he is entitled to
attorney's fees pursuant to Domestic Relations Law §
the Supreme Court properly denied the defendant's motion,