Voiding Settlements | Co-op Defamation | River Rights

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Depression and Stress Could Not Void a Settlement

Depression and Stress Could Not Void a Settlement

In NG v. Chalasani, a Civil Court denied a motion to vacate a stipulation of settlement in a holdover summary proceeding based on conclusory contentions of depression and stress and the Appellate Court agreed.

A tenant appealed from a Civil Court order denying a motion to vacate a stipulation of settlement in a holdover summary proceeding. Her landlord had obtained a default final judgment based on the expiration of the parties’ residential lease, evicting tenant and her under tenants. The tenant successfully moved to vacate that default final judgment. Four months later, after lengthy negotiations, the landlord and tenant, both represented by counsel, executed a stipulation of settlement that provided for the waiver of unpaid rent and for compensation for lost personal property in exchange for mutual releases of all outstanding claims between the parties. A year after executing the stipulation, the tenant moved to vacate it on the grounds that she had been depressed, under stress, and pressured by her attorney when she entered into it; that there were irregularities in the predicate notices in the summary proceeding; and that the compensation set forth in the stipulation of settlement was inadequate.

The Appellate Court affirmed the Civil Court’s denial, reasoning that “it is well settled that stipulations of settlement ‘are favored by the courts and not lightly cast aside.’ As ‘independent contracts…subject to the principles of contract law,’ stipulations may be vacated only on grounds sufficient to invalidate a contract, such as ‘fraud, mistake, collusion or accident.’ ‘The mere fact that it subsequently appears that the stipulation/settlement was a bad bargain does not warrant vacatur,’ and tenant offered no facts which, if true, would support an inference that her valuation of the lost property, as expressed in the stipulation, was so inequitable as to warrant the vacatur of the stipulation. Further, insofar as tenant appears to claim that, due to depression, stress, and pressure from her attorney, she lacked the capacity to intelligently negotiate settlement terms, ‘case law makes clear that a person is presumed to be competent at the time of the performance of the challenged action and the burden of proving incompetence rests with the party asserting incapacity.’ Mere conclusory assertions of stress and depression are insufficient to establish that her mind was ‘so affected as to render her wholly and absolutely incompetent to comprehend and understand the nature of the transaction.’”

As for the tenant’s remaining challenges, including lack of proper service, the Court dispensed with these arguments because, having found the stipulation to be binding on the tenant, she waived those defenses “by virtue of the stipulation of settlement.”

Co-op Board Member Labeled “In Arrears” Not Defamed

Co-op Board Member Labeled “In Arrears” Not Defamed

In Galanova v. Safir, a co-op owner and board member commenced an action against her co-op and fellow co-op board members, alleging that they had defamed her in two e-mails sent to board members, the co-op’s managing agent, and the co-op’s general counsel, indicating that she was in arrears and owed a debt to the co-op. She also claimed that she had been defamed by “Shareholders in Arrears” flyers posted in the lobby of the co-op building listing her apartment number and the amount of alleged arrears, and by the posting on her apartment door of a petition in a non-payment summary proceeding commenced against her in the Civil Court, Kings County.

She alleged that as a result of the communications, she was “held to ridicule, derision and scorn in her community,” and “held out to be a deadbeat person not worthy of being a Board Member or part of the Cooperative Community,” and that she was “humiliated,” “lost work and employment,” and “suffered sleepless nights and nervousness, and … incurred legal fees in her defense of the non-payment proceeding.” She sought $1 million as result.

After the Supreme Court in Kings County denied the defendants’ motion for summary judgment, an Appellate Court reversed and dismissed her complaint.

The two e-mails stated: “It is only appropriate for you to finally pay your debt and make a significant effort to learn how to become a respected member of the community”; and “As a Board member you should not be in arrears. As a Board member you should work on your assignments and that does not include misleading people AND having others do the tasks that you accepted and made commitments to complete. YOU HAVE DONE NOTHING except spreading rumors and that contribute to your limited intelligence and dignity.”

Finding the e-mails pure opinion, the Appellate Court reasoned that “expressions of an opinion, ‘false or not, libelous or not, are constitutionally protected and may not be the subject of private damage actions.’ ‘The issue of distinguishing between actionable fact and non-actionable opinion is a question of law for the court.’ Here, the statements contained in the two e-mails alleged to be defamatory amounted to subjective characterizations of the plaintiff’s behavior and an evaluation of her performance as a member of the Board, and thus constituted non-actionable expressions of opinion. Accordingly, the e-mail statements cannot serve as a basis for the imposition of liability.”

As for the “Shareholders In Arrears” flyers posted in the building lobby, which listed the apartment numbers of shareholders who allegedly owed arrears and the amount of those arrears, the Court concluded they were protected by the qualified common-interest privilege. “Although a qualified privilege may be lost by proof that the defendant acted out of malice, in opposition to the defendants’ motion, the plaintiff failed to raise a triable issue of fact as to whether the challenged statements in the flyers were motivated solely by malice.”

Lastly, with respect to the petition in the non-payment summary proceeding that was posted on the plaintiff’s apartment door, the Court held that it was in the course of effecting service pursuant to statutory procedures, and that the statements contained in the petition were protected by an absolute privilege because they were pertinent to an ongoing judicial action.

But A River Runs Through It

But A River Runs Through It

In Thayer Lake v. Brown, the State’s highest Court recently ruled that questions of fact remain to be tried as to whether an upstate waterway is “navigable-in-fact” and therefore open to public use.

According to the decision, the plaintiffs are the collective owners of real property in a remote area of the Adirondack Mountains. The property is bounded on the north by the Williams C. Whitney Wilderness Area (the “Wilderness Area”), which consists of more than 20,000 acres of State forest preserve land. The Wilderness Area was privately owned, at least during the 20th century, until fully acquired by the State in 1998. Within the Wilderness Area, a network of lakes, ponds, streams, and canoe carry trails known as the Lila Traverse Section of the Whitney Loops (the “Lila Traverse”) permits canoe travel between two lakes on opposite sides of the Wilderness Area.

The parties’ dispute concerns the Mud Pond Waterway (the “Waterway”), a two-mile-long system of ponds and streams within the Lila Traverse that crosses plaintiffs’ property. Shortly after the Wilderness Area was acquired by the State, the defendant DEC constructed a 0.8-mile carry trail in order to permit canoe travelers to avoid the Waterway and complete the Lila Traverse without entering plaintiffs’ property. However, the DEC now asserts that members of the public are not obligated to use the carry trail, because the Waterway is subject to a public right of navigation. New York’s Navigation Law Section 2 defines “navigable waters of the state” as all lakes, rivers, streams and waters within the boundaries of the state and not privately owned, which are navigable in fact or upon which vessels are operated, except the waters of the Long Island Sound lying within the boundaries of Westchester County and all tidewaters bordering on and lying within the boundaries of Nassau and Suffolk Counties.” However, this definition only governs the use of the term in that law, and does not define the rights of parties in controversies outside this definition. In cases not falling within the definition, the courts treat all rivers and streams or other bodies of water which are “navigable-in-fact”; that is, if they are of such size and character that they can be used regularly for the purposes of transportation and commerce, as navigable in law. The division of waters into navigable and non-navigable is another way of classifying them as public or private, and that navigable waters embrace all bodies of water which are public in their nature. This stems from English common law. This rule recognizes that some waterways are of such practical utility that private ownership from the time of the original grant from the State or sovereign is subject to an easement for public travel.

Here, the Court reasoned that as a “general principle, if a waterway is not navigable-in-fact, ‘it is the private property of the adjacent landowner.’ A waterway that is navigable-in-fact, however, ‘is considered a public highway, notwithstanding the fact that its banks and bed are in private hands.’ To be subject to this public easement, a waterway must provide practical utility to the public as a means for transportation, whether for trade or travel.” In a previous decision of the Court, it concluded that “recreational use” may properly be “part of the navigability analysis.”

The parties disputed the Waterway’s navigability, and despite their collective view that the issue should be decided “as a matter of law” without a trial, the Court held that a “waterway’s navigability is a highly fact-specific determination that cannot always be resolved as a matter of law. On a motion for summary judgment, the moving party must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact. Summary judgment is inappropriate in any case where there are material issues of fact in dispute or where more than one conclusion may be drawn from the established facts.”

As such, the Court declined to award judgment as a matter of law. “Contrary to their claim, the parties have presented conflicting or inconclusive evidence with regard to a number of material facts and the inferences they wish to be drawn from those facts. The record is not conclusive with regard to, for instance, the Waterway’s historical and prospective commercial utility, the Waterway’s historical accessibility to the public, relative ease of passage by canoe, the volume of historical travel, and the volume of prospective commercial and recreational use. Collectively, these factual assessments present material considerations that, left unresolved, permit more than one conclusion to be drawn concerning the Waterway’s practical utility. As material questions of fact remain, neither party has demonstrated prima facie entitlement to summary judgment, and the competing evidence must be weighed and the credibility of the witnesses must be assessed by a factfinder. These factual determinations and their relative weight as well as the ‘ultimate conclusion’ of navigability-in-fact are for the trier of fact based on the evidence.”

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