Papers considered: 1. Notice of Petition dated October 23, 2023, Verified Petition, Affidavit of Kenan Gunduz in Support dated October 23, 2023, with Exhibits A-F, and Affirmation in Support of James Bacon dated October 23, 2023. 2. Verified Answer dated November 2, 2023, Affirmation in Opposition to Petition of John F. Lyons, Esq., and Kimberly A. Garrison, Esq., dated November 2, 2023 with Exhibits A-H, and the Affidavit in Opposition of David Allen, dated November 2, 2023. 3. Reply Affidavit of Kerry Dannenberg dated November 9, 2023 and Reply Affirmation of James Bacon dated November 9, 2023 with Exhibit A. DECISION/ORDER Petitioner, Cedar Development East, LLC, (“Cedar”), brings this Article 78 petition to enforce provisions of a December 28, 2022, Stipulation of Settlement which, among other things, specifically requires Respondent, David Allen, to act as Building Inspector for the project which is the subject of this litigation. The Stipulation of Settlement requires Allen to review the site plan, building permit application and building plans and provide comments, if any, within 21 calendar days from his receipt of same. Any subsequent reviews are to be limited to the non-code compliant matters identified by Allen and Cedar’s response to those comments, which are then to be addressed by Allen within 21 calendar days commencing from the date of Cedar’s resubmission. BACKGROUND Cedar’s project involves converting a former school building into 46 residential condominium units. The Town of Hurley’s opposition to this project has been the subject of previous litigation before this Court. On April 25, 2022, Cedar filed a building permit application with Town of Hurley Building Inspector Glenn Hoffstatter which included architectural plans stamped by a registered architect. After six weeks of correspondence, the Hurley Building Department responded on June 10, 2022, stating, in part, it would not issue a building permit without signed site plans. Cedar appealed that determination to the Town of Hurley Zoning Board of Appeals. On July 25, 2022, Cedar’s counsel, Michael Moriello, Esq., submitted the final site plans for signature to Acting Chairperson of the Planning Board, Peter McKnight. On August 3, 2022, McKnight falsely claimed that he was not the Chairperson of the Planning Board, despite being identified on the Town of Hurley’s website as the Acting Chairperson. Planning Board minutes dated June 20, 2022, also identified McKnight as Acting Chair. Cedar was forced to bring an action on August 6, 2022 to compel the Planning Board Chair to sign the site plans. This Court issued a Decision/Order dated November 21, 20221 requiring the Planning Board Chair to sign the site plans. Prior to signing the site plans, Hurley requested that several changes be made, including that certain notes be added. As part of an overall settlement, Cedar agreed and filed revised maps which were signed by McKnight on November 30, 2022. On December 28, 2022, the parties executed the Stipulation of Settlement sought to be enforced herein. The parties agreed to forego all appeals and Cedar would withdraw its appeal to the Zoning Board of Appeals upon Respondents’ promise that Allen would promptly review Cedar’s initial or subsequent architectural plans in 21-day increments until finding that the plans complied with the building and fire codes. In relevant part, the Stipulation of Settlement provides: “1. David Allen shall continue as Building Inspector for the Development Project on behalf of the Town. 2. Upon his receipt of a signed site plan, building plans and the requisite building permit fee, the Building Inspector shall conduct a review of the building permit application and building plans. The Building Inspector shall review the building permit application and plans and provide comments, if any, to Cedar no later than twenty-one (21) calendar days from his receipt of the signed site plan, building plans and the requisite fee from Cedar (not including the date he receives the building permit application). Subsequent review(s) shall be limited to the noncode compliant matters identified by the Building Inspector and Cedar’s response to such review(s) shall be addressed by the Building Inspector no later than twenty-one (21) calendar days commencing from the date of resubmission by Cedar.” On January 17, 2023, Cedar provided approximately 45 sheets of architectural, electrical, plumbing, and sprinkler details with the Hurley Building Department. Allen did not respond within 21 calendar days. After repeated communications, Allen requested that Cedar pay the Town of Hurley a building permit fee of $11,040.00. Cedar paid the fee on February 24, 2023. Allen gave Cedar a letter, dated February 23, 2023, stating that Cedar’s architectural plans complied fully with the building and fire codes. The architectural plans were stamped “approved” by the Town of Hurley Building Department on February 23, 2022. Cedar discovered in September 2023 that its architect had mistakenly included an additional unit in the plans approved by Allen, with the total being 47 units rather than 46. On September 18, 2023, Cedar’s counsel delivered corrected plans to Allen showing that three of the units were combined into two units, reducing the total to 46 units. No other changes to the approved plans were made. Allen initially indicated the review would be straightforward, with a couple of recommended changes concerning the smoke alarm and the sprinkler system notes. Despite numerous phone calls, messages and correspondence with Allen and the Town of Hurley’s attorneys, no response was forthcoming within the 21-day timeframe. After no response was received for 33 days, Cedar brought this Article 78 petition. This proceeding was filed on October 23, 2023. RESPONDENTS’ CONTENTIONS Four days after the filing of this action, a report entitled Plan and Submission Review was prepared by Hurley Building Inspector Paul Economos, rather than Allen, which went well beyond addressing the simple change made to combine three units to two units to bring the total down to 46 units. Economos reviewed the entire plans, including those marked approved on February 23, 2023, and found them to be deficient in numerous ways. By letter dated November 2, 2023, Allen indicated, without elaboration, that he concurred with Economos. Respondents contend that this Article 78 petition was brought to compel a response to the September 18, 2023, submission by Cedar. Now that a response has been provided, this proceeding is moot. Additionally, Respondents assert that the Building Inspector, rather than Allen personally, is responsible for reviewing architectural plans. On September 19, 2023, the day after Cedar’s most recent submission, Hurley hired Economos as its full-time Building Inspector. Finally, Respondents argue that Economos has corrected the February 23, 2023, mistaken approval by Allen and that estoppel may not be applied to prevent correction of Allen’s approval. PETITIONER’S CONTENTIONS In reply to Respondents’ submission, Petitioner seeks a direction from the Court requiring Allen to provide comments only as to whether the minor amendment of the plans, merging three units into two, complies with the New York State building and fire codes, as required by the Stipulation of Settlement. Cedar asserts that Allen continues to fail to comply with the Stipulation of Settlement, as he has not provided comments limited to the minor change in the plans occasioned by the reduction of one unit; that Economos is not authorized to act in Allen’s stead; and Hurley’s delay is a return to its well-documented unlawful attempts to thwart Cedar and increase project costs. Hurley’s response to Cedar’s project has included enacting a moratorium; ignoring its Town Planner and Cedar’s engineering and hydrogeological data, requiring duplicative and unnecessary environmental studies which prolonged the SEQRA review; adopting a zoning amendment designed to stop the project; ignoring its attorney’s advice; delaying public hearings; and delaying site plan and special use permit applications for years. Cedar brought a successful action to annul the moratorium. Cedar brought a second action to compel McKnight to sign the site plans. The Stipulation of Settlement requires that Allen “continue as Building Inspector for the [project] on behalf of the Town” and provides a 21- day response framework. Allen personally signed the Stipulation. It notes that Economos was on the Planning Board precisely when that Board conspired to force Cedar to perform duplicative hydrogeological, traffic and other environmental studies. Cedar asserts that Economos is unauthorized to disturb the February 23, 2023, approval and he must recuse himself from any involvement with this project due to his pre-existing bias. The Stipulation of Settlement’s 21-day review limit intended to prevent this exact scenario. The minutes of the September 19, 2023 Board meeting show no change in Allen’s employment status. Cedar seeks enforcement of the Stipulation of Settlement, limiting the review to be performed by Allen to commenting only on the minor alteration of the plans, along with an award of sanctions and counsel fees. DISCUSSION “Courts favor stipulations of settlement and will not lightly set them aside…”. Richard BB. v. Louis BB. (In re Estate of Rose BB.), 300 AD2d 868, 869 (App. Div. 3 Dept., 2002); Hallack v. State of New York, 64 NY2d 224, 230 (1984). Strict enforcement not only serves the interest of efficient dispute resolution but also is essential to the management of court calendars and integrity of the litigation process. Id. Municipalities are treated no differently from private parties with respect to contractual obligations. Matter of Ecogen Wind LLC v. Town of Prattsburgh Town Board, 112 AD3d 1282, 1285 (App. Div. 4 Dept., 2013); see, generally, H.K.S. Hunt Club v. Town of Claverack, 222 AD2d 769 (App. Div. 3 Dept., 1995). The Court determines that this proceeding is not mooted by Respondents’ submissions, as questions remain as to whether the review by Economos, and the concurrence by Allen, complies with the clear terms of the Stipulation of Settlement. There can be no doubt that the Respondents violated the terms of the Stipulation of Settlement. The Stipulation of Settlement specifically appointed Allen as the person who would conduct the reviews and provide comments. No application was made to Cedar, or to the Court, to amend the Stipulation to allow Economos to substitute for Allen. This change was made unilaterally, after Cedar’s submission to Allen on September 18, 2023. Economos’ Plan and Submission Review is dated four days after this proceeding was commenced. The Stipulation of Settlement provides that it “shall not be modified except in writing signed by all the parties”. Thus, the review by Economos is unauthorized and in violation of the clear terms of the Stipulation of Settlement. Economos’ review of the entire project, rather than a limited review of the minor amendment to the previously approved plans, as well as Allen’s concurrence therewith, exceeds the scope of review agreed to by the parties. Economos’ review appears on its face to be motivated by bad faith, intended to cause further delay, and increase Cedar’s costs. Respondents failed to adhere to the 21-day time frame, without explanation to Cedar and without obtaining an extension of time in writing signed by all parties, necessitating more litigation. Furthermore, this situation is distinguishable from the cases cited by Respondents, as Cedar’s Petition invokes neither estoppel nor laches to prevent Respondents from discharging its statutory duties. Rather, the Petition seeks only to enforce the terms of the Stipulation of Settlement, negotiated by the parties to resolve contested litigation, which provides for a process of review by an agreed-upon individual within a defined period of time. The purpose of the Stipulation is to avoid continued litigation; a purpose frustrated by the deliberate actions of the Respondents. Additionally, the Court of Appeals has “not absolutely precluded the possibility of estoppel against a governmental agency”, although it “is foreclosed ‘in all but the rarest cases’”. New York State Medical Transporters Ass’n v. Perales, 77 NY2d 126, 130 (1990), quoting Matter of Parkview Associates v. City of New York, 71 NY2d 274, 282 (1988). Exceptions to the general rule against invoking estoppel may be warranted in “unusual factual situations” to prevent injustice. E.F.S. Ventures Corp. v. Foster, 71 NY2d 359, 369-370 (1988). The Court declines to award sanctions or counsel fees to Cedar, without prejudice to Cedar’s right to pursue any remedies it may have in a plenary breach of contract action, as the request for sanctions and counsel fees was made for the first time in Petitioner’s Reply, and Respondents have had no opportunity to respond. Accordingly, it is hereby ORDERED, that the Petition is granted to the extent that Allen shall provide comments, limited to a review of the September 18, 2023, changes made to the previously approved plans; and it is further ORDERED, that Allen shall provide such comments to Cedar within 10 calendar days from the date this Decision/Order is served with notice of entry; and it is further ORDERED, that Cedar’s request for sanctions and counsel fees is denied, without prejudice. This shall constitute the Decision/Order of the Court. The Court is e-filing the original of this Decision/Order but that does not relieve the parties from compliance with CPLR 2220 regarding notice of entry thereof. Dated: January 8, 2024
