Comments on Recent Cases: December 2021

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Part of my work involves reading court decisions to keep abreast of how judges decide the types of cases I handle. Below, I share some thoughts on recent decisions.

Court Strictly Enforces Settlement Agreement

Once a commercially sophisticated party settles a claim in litigation, it is generally bound by its settlement agreement, even if the terms aren’t fair. This is because courts defer to parties to settle their own claims and reserve their resources for disputes that need their intervention.

The state appellate court in Manhattan recently upheld this principle in a recent decision. In that case, a hotel and a construction company had a dispute and settled it. The settlement expressly included the fact that that the construction company got to keep progress payments for work it allegedly didn’t do, but the scope of the release in the settlement did not release all possible claims to recover those payments. When the hotel sued the construction company, arguing that it never released all of its claims and that it was unfair for the defendant to keep payments it didn’t earn, the appellate court rejected the claim. It held that the settlement agreement ended the dispute since it expressly stated the construction company got to keep the payments, even if not all possible claims related to the payments were formally released.

Cases like this illustrate how important it is to negotiate acceptable settlement agreements because courts may not second guess them.

Court Considers Medical Practices Distinct When Determining Negligence Liability

Through a doctrine called respondeat superior, an employer can be held civilly liable in litigation for the negligence of its employees. This often leads to defendants arguing they should not be liable because they are not technically the employer of the negligent person.

This argument worked in a recent decision by the state appellate court in Manhattan. In that case, a medical practice and its principal argued that they did not employ a doctor accused of malpractice. Instead, they argued, the negligent doctor worked for a different medical practice. The plaintiff argued that the different medical practice was owned by the same defendant and its office was at the same address as the other defendant. It even shared the same letterhead. But because the negligent doctor worked for a distinct, different employer, the defendants were not liable.

Cases like this demonstrate the liability limits that arise from distinct corporate entities.

Court Holds Witness Bound to Her Deposition Testimony Even When She Disavows It

Even though witnesses should only testify at depositions about facts they are confident at true, sometimes they say false things. When that happen, it can be difficult in litigation to correct the record.

In a recent decision by the state appellate court in Manhattan, the court affirmed a summary judgment motion based on a deponent’s testimony that she did not live at the address that was covered by her insurance and her drivers license that corroborated her testimony.

In opposition to the motion, the witness submitted a sworn statement that she had actually lied at her deposition and the truth was she did really live at the insured address. But the court held that, without more evidence about her address, she was bound by her testimony, even if she now claimed it was a lie.

Cases like this illustrate how important it is to ensure that deposition testimony is truthful and accurate.