Marasco v. ExxonMobil Oil Corp.

In this action involving claims under Navigation Law §181 and the common law, which relate to an oil spill at a gasoline service station owned by plaintiffs, defendants move to enforce a settlement agreement entered into in open court. Defendants also move, pursuant to 22 NYCRR §216.1, to file the terms of the settlement under seal by permanently sealing Exhibits 3, 7 and 9 to the Sonia Lee, Esq. Affirmation in support and all those redacted portions of the Lee Affirmation and Memorandum of Law. The following papers were read and considered on this motion in addition to the legal proceedings conducted on October 18, 2021 and the hearing held on May 31, 2022: Papers Considered: NYSCEF DOC NO. 249-261, 269-274, 276-281. 1. Notice of Motion/Statement of Material Facts/Affirmation of Sonia H. Lee, Esq. in support/Exhibits 1-9/Memorandum of Law in support/Proposed Order. 2. Affidavit of Peter A. Marasco in opposition/Exhibits 1-5 including affidavits of Anthony Paul Marasco and Josephine Z. Marasco. 3. Reply Affirmation/Memorandum of Law-Brief in reply. 4. Letter Correspondence from Sonia H. Lee, Esq. 5. Transcript of Proceedings from May 31, 2022 Hearing 6. Letter Correspondence from Peter A. Marasco dated June 7, 2022. 7. Letter Correspondence from Sonia H. Lee, Esq. dated June 8, 2022. 8. Letter Correspondence from Peter A. Marasco dated June 16, 2022. 9. Letter Correspondence from Sonia H. Lee, Esq. dated June 17, 2022. DECISION & ORDER Factual and Procedural Background Plaintiffs commenced this action by the filing of a summons and complaint on March 27, 2013¹. Plaintiffs subsequently filed an amended complaint on May 1, 2013². Defendants filed an answer on June 17, 2013. A recitation of the underlying facts of this action were fully set forth in the court’s Decision and Order [Ruderman, J.]³ dated October 3, 2019 and will not be repeated here, except as may be necessary and relevant to the determination of this motion. On June 2, 2017, a Consent to Change Attorney was filed stating that Turner & Turner, Esqs. were substituted by plaintiff Peter A. Marasco who was proceeding pro se and would also be representing all plaintiffs⁴. On March 12, 2019, a Notice of Appearance was filed by Stanley E. Esposito, Esq. stating that he was appearing as Attorney of Record for plaintiffs, Anthony Paul Marasco and Josephine Z. Marasco⁵. This Notice of Appearance stated that plaintiff Peter Marasco was pro se. On July 12, 2019, plaintiffs filed a motion for summary judgment. The Notice of Motion indicated that plaintiff Peter A. Marasco was pro se and plaintiffs Anthony Paul Marasco and Josephine Z. Marasco were represented by Stanley E. Esposito, Esq.⁶ The motion was denied by Decision and Order [Ruderman, J.] dated October 3, 2019 and the parties were directed to appear in the Settlement Conference Part on November 19, 2019⁷. A trial date was set for January 6, 2020⁸. Thereafter, plaintiffs collectively filed an Order to Show Cause seeking to adjourn the trial⁹. On January 6, 2020, the motion was granted and the jury trial was adjourned to August 31, 2020¹⁰. On June 3, 2020, a Notice of Appearance was filed by George S. Bellantoni, Esq., who entered an appearance on behalf of all three plaintiffs.¹¹ On the same date, George S. Bellantoni, Esq. filed two Consent to Change Attorney forms whereby he was substituted for Stanley E. Esposito, Esq. as counsel for plaintiffs Anthony Paul Marasco and Josephine Z. Marasco¹². On July 21, 2021, a Trial Date Scheduling Order issued setting the trial down for September 30, 2021¹³. Subsequently, multiple motions were filed which were ultimately withdrawn. The matter was then conferenced with this court on October 14, 2021. This case was then scheduled for jury selection on October 18, 2021. This was a final date for trial to commence. On October 18, 2021, plaintiff Peter A. Marasco appearing pro se, George Bellantoni, Esq. appearing for the co-plaintiffs and counsel for the remaining defendants appeared for jury selection. Before a jury was selected, the parties reached a settlement agreement on that date. Defendants now move to enforce this settlement agreement negotiated and agreed to on the record, whereby defendants agreed to pay a certain sum in exchange for the discontinuance of this case. Defendants also move to file the terms of the settlement under seal. Plaintiffs oppose the motion. Defendants submit, inter alia, the following salient facts in support of their motion. On October 18, 2021, the parties appeared to select a jury. This date was marked final for the trial to commence. Prior to jury selection, the parties were called to chambers. After discussions and negotiations, the parties agreed to settle the case and a stipulation of settlement was entered into between Peter A. Marasco appearing pro se and counsel for co-plaintiffs and for defendants. The parties spread the settlement on the record, which included the voir dire of plaintiff Peter A. Marasco by this Court. Defendants submit a copy of the transcript from the proceedings that occurred on October 18, 2021 and the subsequent proceedings held on May 31, 2022 in support of this motion¹⁴. A review of the transcript of the settlement proceedings demonstrates that the following exchange occurred on October 18, 2021: THE COURT: …Do you swear the statements and the testimony you’re going to give this morning will be the truth under the penalty of perjury? MR. MARASCO: Yes, I do. THE COURT: All right. We’ve had discussions on this case, Mr. Marasco, and there’s been an offer extended to you of [amount redacted in the transcript] to resolve all the issues in the pleadings, and I understand that you’ve agreed to accept? THE MARASCO: Yes. I haven’t spoken to — I think the other two will take it, but I haven’t called them yet. THE COURT: Are you representing all parties? MR. BELLANTONI: I am, Your Honor. THE COURT: You can represent that that will be acceptable to all Plaintiffs? MR. BELLANTONI: I can, Judge, yes. THE COURT: Mr. Marasco, do you have any questions for the Court? MR. MARASCO: No. THE COURT: Do you understand completely the terms? MR. MARASCO: Yes. THE COURT: That you’re giving up the right to continue this lawsuit and seek other damages for the payment of [amount redacted in the transcript]. MR. MARASCO: Right. THE COURT: Have you taken any medication today to impair your ability to understand that you’re entering into this agreement? MR. MARASCO: No. THE COURT: Anything you want to add, Counsel? MR. BELLANTONI: No, Your Honor. THE COURT: Counsel? MS. LEE: No, Your Honor. THE COURT: Okay. The Court will make a finding that it has inquired of the Plaintiff and that he’s agreed to accept the sum of [amount redacted in the transcript] in full settlement of all claims under this lawsuit and that he’s done so voluntarily and without any force or pressure on him. That will resolve all claims made in this lawsuit, and I thank you all for your cooperation. Based upon these proceedings and the proceedings held on May 31, 2022, the defendants seek to enforce the settlement agreement made in open court on the record and to seal the terms of the settlement. In opposition, plaintiff Peter A. Marasco concedes that George Bellantoni, Esq. was retained as attorney for plaintiffs in or about January 10, 2020. Nevertheless, George Bellantoni did not file his Notice of Appearance until June 3, 2020. Peter A. Marasco alleges that on the date of the settlement, George Bellantoni did not speak or have any communications with the co-plaintiffs Anthony Paul Marasco and Josephine Z. Marasco and that they had no knowledge that a trial was commencing. In addition, Peter A. Marasco argues that on October 18, 2021, when George Bellantoni attended the pre-trial conference and agreed to the settlement terms, the co-plaintiffs had no knowledge and had not been consulted. Additionally, Peter A. Marasco contends that George Bellantoni had been discharged as counsel for co-plaintiffs prior to the pre-trial conference¹⁵. He submits that George Bellantoni, while purporting to represent the co-plaintiffs never spoke to or communicated with either of the co-plaintiffs, but yet agreed to settlement terms on their behalf. Peter Marasco argues that George Bellantoni lacked authority to enter into the settlement. In further opposition, Peter A. Marasco asserts that he agreed to settle the case under duress as he was worried that witnesses who were subpoenaed to testify would not be available to testify on the first day of trial. Additionally, Peter A. Marasco contends that the terms of the settlement agreement negotiated on October 18, 2021, to which he asserts co-plaintiffs were not a part of, do not come close to making plaintiffs whole in terms of legal fees, pre-judgment interest and costs associated with this lawsuit. Peter A. Marasco also opposes the sealing of any settlement terms as he asserts this is a matter of public interest in that it pertains to protecting the environment. Co-plaintiffs Anthony Paul Marasco and Josephine Z. Marasco also submit affidavits in opposition to the motion, stating they discharged George Bellantoni as counsel prior to October 18, 2021¹⁶ and did not agree to the terms of the settlement. They also request that the court grant their cross-motion to set aside and vacate the Settlement Agreement that occurred on October 18, 2021¹⁷. In reply, defendants submit that they are seeking to enforce a basic settlement whereby the parties would execute a settlement agreement with general releases; defendants would pay plaintiffs the agreed upon settlement amount; and the parties would then enter into a voluntary stipulation of dismissal. Additionally, defendants argue that the settlement agreement is enforceable because the parties had 1) legal capacity to negotiate; 2) they did in fact freely negotiate; and 3) they entered into the stipulation orally and on the record in open court. Defendants cite Baker v. Restaurant Depot, 149 AD3d 675 [2d Dept 2017] in support. Defendants maintain that while plaintiffs now contest and argue that plaintiff pro se and co-plaintiffs’ counsel did not have authority to bind plaintiffs, this is not the case. This Court scheduled a hearing on May 31, 2022 to take testimony with regard to this motion¹⁸. At that time, Peter A. Marasco and George Bellantoni, Esq. appeared in person. Plaintiffs Anthony Paul Marasco and Josephine Z. Marasco appeared virtually. Discussion In the instant case, a review of the court record demonstrates that on June 3, 2020, George Bellantoni, Esq. filed a Notice of Appearance stating that he represented all three plaintiffs¹⁹. Consents to change attorney from Attorney Esposito to Attorney Bellantoni, individually signed by plaintiffs Anthony Paul Marasco and Josephine Z. Marasco and notarized, were also filed²⁰. Peter A. Marasco was self-represented at that point. On the date the stipulation of settlement was entered in open court, Peter A. Marasco was present and questioned by this Court. Notably, a review of the transcript evidences that Peter A. Marasco did not object or interject when the court asked George Bellantoni whether he represented co-plaintiffs and whether he had authority to enter into the settlement agreement on behalf of the co-plaintiffs. Peter A. Marasco was also asked whether he understood the terms of the settlement and that he was giving up the right to seek any additional damages, other than the settlement amount, and he answered affirmatively. The court conducted a voir dire of Peter A. Marasco before accepting the stipulation of settlement. The court finds that the terms of the stipulation were “clear, final and the product of mutual accord”. See Peralta v. All Weather Tire Sales & Service, Inc, 58 AD3d 822 [2d Dept. 2009]. Any current claims of duress by Peter A. Marasco are belied by his unequivocal responses on the record. See Fox v. Merriman, 307 AD2d 685 [3d Dept 2003]. To repudiate a settlement agreement on the ground of duress requires that the party demonstrate a wrongful threat and that his exercise of free will was precluded. See Lopez v. Muttana, 144 AD3d 871 [2d Dept. 2016]. There is no such showing on this record. While Peter A. Marasco subsequently appears to have remorse or second thoughts as to the settlement amount, the court engaged in lengthy settlement discussions, placed him under oath and gave him an opportunity to ask any questions, which he declined. The court finds that the settlement agreement is not unconscionable, but is in fact quite favorable to plaintiffs. See Hershowitz v. Levy, 190 AD3d 835, 190 AD3d 835 [2d Dept 2021]. At the hearing on May 31, 2022, plaintiffs Anthony Paul Marasco and Josephine Z. Marasco appeared by virtual means and stated they had no questions for the court or for the witness George Bellantoni. George Bellantoni testified, inter alia, that it was his understanding on the date of the settlement that Peter A. Marasco was representing the wishes of his siblings and that they would follow his lead in accepting a settlement offer. Additionally, George Bellantoni confirmed that he represented to the court on the date of the settlement that he had the authority to settle the case on behalf of co-plaintiffs. A stipulation of settlement which has been made in open court and has been recorded stenographically is enforceable as a binding contract. See Linsalato v. Giuttari, 59 AD3d 682 [2d Dept 2009] citing Fukilman v. 31st Ave Realty Corp, 39 AD3d 812 [2d Dept 2007]; Bellefleur v. Gervais, 201 AD2d 524 [2d Dept 1994]. Where, as here, the terms of the stipulation are not ambiguous, the court must glean the parties’ intent by the plain meaning of the words used by the parties. See Linsalato v. Giuttari, Id. citing Fukilman v. 31st Ave Realty Corp, supra. Additionally, stipulations of settlement are judicially favored and should not lightly be set aside by the courts. See Leahy v. Leahy, 9 AD3d 351 [2d Dept 2004] and cases cited therein. The court finds that plaintiffs have not demonstrated good cause sufficient to invalidate the stipulation and that Peter A. Marasco entered into a knowing and voluntary settlement on the record. Also, it is of no consequence that a client is not present at the time the case is settled, when the attorney had, at minimum, apparent authority to settle the matter. See Amerally v. Liberty King Produce, Inc, 170 AD3d 637 [2d Dept 2019] citing Stoll v. Port Auth, 268 AD2d 379 [1st Dept 2000]. The court finds that George Bellantoni was the attorney of record for co-plaintiffs on the date of the settlement who had actual and apparent authority to settle the case on behalf of co-plaintiffs, based upon his original Notice of Appearance, the co-plaintiffs’ aforementioned signed and notarized consents to change attorney agreeing to George Bellantoni’s representation and his multiple appearances in court on behalf of co-plaintiffs. Moreover, when the court questioned George Bellantoni regarding his authority to represent co-plaintiffs and to enter into the settlement agreement on their behalf, Peter A. Marasco did not contradict or otherwise challenge George Bellantoni’s authority to act on co-plaintiffs’ behalf. Though consents to change legal representation were filed with the court relative to George Bellantoni’s subsequent motion to be relieved as counsel²¹, those consents which are dated October 17, 2021, were not notarized and purport to have Peter A. Marasco represent the co-plaintiffs as counsel.²² There is no dispute that Peter A. Marasco is not an attorney licensed to practice law in the State of New York²³. As such, he had no authority at any time in this action to represent the co-plaintiffs, even though they are related. See NY CLS Jud 478; See also Abraham v. American Gardens Co, 189 AD3d 741, [2d Dept 2020] citing Whitehead v. Town House Equities, Ltd, 8 AD3d 369 [2d Dept 2004]. On October 18, 2021, Peter A. Marasco and George Bellantoni appeared for jury selection, while Anthony Paul Marasco and Josephine Z. Marasco did not. At the hearing on May 31, 2022, George Bellantoni’s testimony was that Anthony Paul Marasco and Josephine Z. Marasco were not in town for the trial and they did not intend to appear for trial, even though it was marked final²⁴. Neither Anthony Paul Marasco, nor Josephine Z. Marasco disputed that testimony, even though they appeared at the hearing and were provided an opportunity to do so. The court notes that Anthony Paul Marasco resides in the State of Arizona and Josephine Z. Marasco resides in the State of Georgia.²⁵ CPLR §321 (b) provides that a consent to change attorney must be signed by the retiring attorney and signed and acknowledged by the party and then it must be filed with the clerk of the court. No such consent to change attorney was filed with the clerk prior to October 18, 2021, when the settlement was placed on the record. Furthermore, had George Bellantoni been relieved as counsel, this would have left Anthony Paul Marasco and Josephine Z. Marasco without representation as they did not intend to appear in New York for the trial and it is undisputed that Peter A. Marasco did not have authority to represent them. This situation would have been unduly prejudicial to Anthony Paul Marasco and Josephine Z. Marasco and George Bellantoni was obligated to protect their interests and rights in their absence on the day trial was to commence. George Bellantoni confirmed to the court at the May 31,2022 hearing that he advised the court he had authority to settle and had not been formally discharged on the date of the open court settlement agreement²⁶. As such, the court finds that Mr. Bellantoni had actual and apparent authority to settle on behalf of Anthony Paul and Josephine, See Hallock v. State of New York, 64 NY2d 224 (1984). The court now turns to that branch of defendants’ motion which seeks to place under seal the terms of the settlement agreement by permanently sealing Exhibits 3, 7 and 9 to the Lee Affirmation in support and all those redacted portions of the Lee Affirmation and Memorandum of Law. The burden is on the party seeking to seal court records to demonstrate that good cause exists. In order to do that, the party must establish compelling circumstances to justify secrecy. See Mancheski v. Gabelli Group Capital Partners, 39 AD2d 499 ]2d Dept 2007]. The court shall consider the interests of the public as well as those of the parties. See 22 NYCRR 216.1 and Fordham-Coleman v. National Fuel Gas Distribution Corp, 42 AD3d 106 [4th Dept 2007]. As indicated, plaintiffs oppose this branch of the motion. The court finds that defendants have not demonstrated good cause to permanently seal exhibits to this motion or the terms of the settlement agreement. The law favors access by the public and press to both court records and judicial proceedings. See O’Reilly v. McPhilmy, 167 AD3d 922 [2d Dept 2018]. The court finds that defendants have not articulated a compelling interest that would likely be harmed by permitting public access to these documents. See Mosallem v. Berenson, 76 AD3d 345 [1st Dept 2010]. Lastly, while plaintiffs refer to and at times appear to request affirmative relief buried in their affidavits in opposition, they did not formally cross-move for such relief. CPLR 2214(a) requires that a “notice of motion shall specify the time and place of the hearing on the motion, the supporting papers, upon which the motion is based, the relief demanded and the grounds therefor.” As any requests for relief by plaintiffs fail to comply with CPLR 2214(a), any such request for relief is denied. All other arguments raised on this motion and evidence submitted by the parties in connection thereto have been considered by this court, notwithstanding the specific absence of reference thereto. Accordingly, it is hereby ORDERED that defendants’ motion to enforce the settlement is GRANTED and the settlement is deemed to be binding upon the parties; and it is further ORDERED that plaintiffs are directed to execute the revised settlement documents²⁷ within twenty (20) days of entry of the Order; that defendants shall then pay plaintiffs the settlement amount by depositing the monies in the escrow account of George S. Bellantoni, Esq. until plaintiffs resolve their fee dispute with counsel and the parties shall thereafter file a Stipulation of Discontinuance; and it is further ORDERED that in the event plaintiffs fail to sign the settlement documents as directed, defendants shall file the settlement agreement signed by any of the parties within sixty (60) days of this Decision and Order with a request for it to be so-ordered; and it is further ORDERED that the branch of the defendants’ motion to seal the settlement agreement and certain documents and exhibits filed in connection with this motion is DENIED; and it is further ORDERED that defendants are directed to serve a copy of this Decision and Order, with Notice of Entry, upon plaintiffs by first class U.S. mail and by certified mail, return receipt requested, within five (5) days of entry and shall file proof of such service on NYSCEF within five (5) days of service. This constitutes the Decision and Order of the Court. Dated: July 25, 2022