The Appellate Court unanimously reverses on breached stipulation.

"No good deed goes unpunished." This ironic phrase, representing a rather cynical view of the "rewards" received by the Good Samaritan, means that the person who elects to do a good deed for another is likely to be made to suffer. A recent decision by the Appellate Division, First Department, demonstrates that another old maxim also holds its own grains of truth; that is, "Good things come to those who wait."

In Estate of Peter Sharp v. Stavisky, et al., the Appellate Division unanimously reversed an order of the Supreme Court and found that based upon the tenant's breach of a stipulation of settlement, a warrant of eviction should be executed, permitting the owner to recover an Upper West Side apartment.

The underlying facts are as follows: In 1986, the owner came to believe that the tenant was not maintaining the apartment as her primary residence, but was, instead, living in Israel. The tenant was rent stabilized, having elected not to purchase her apartment when the building was converted to a cooperative. The owner was the proprietary lessee and holder/owner of the unsold shares pertaining to the apartment at issue.

The owner, via prior counsel, commenced an action in Supreme Court based upon the tenant's non-primary residence status. Also named in the action was the tenant's son, whom the owner believed was the person actually occupying the apartment; albeit without the owner's consent.

Following negotiations, the parties settled the action via a stipulation whereby the tenant conceded her non-primary resident status; permitting the owner to obtain a judgment of possession and an order of ejectment, but staying the actual eviction. The stay would be continued until the August 31st following the tenant's death "so long as [the tenant] continues to occupy the subject apartment during her lifetime at least a portion of the calendar year." The stipulation further provided that: "[the tenant] need not occupy the subject apartment as her primary residence so long as she continues to occupy in same at least a portion of the calendar year."

The owner had opted to accept this negotiated resolution to the litigation, principally in recognition of the tenant's advanced age; she is presently in her nineties. In addition, the tenant's family had explained that although the tenant was primarily residing in Israel, she needed her apartment as the home that she could return to during her frequent visits to her family, including children and grandchildren. The owner believed that he would eventually recover possession of the apartment, although a bit more delayed, and would, via the settlement, be able to avoid seeking the eviction of a senior citizen or deprive her, in her last years, from being able to retain her home for anticipated family visits. Unfortunately, the owner subsequently discovered that its compassionate gesture would be turned on its head by the tenant and her family in their attempt to twist the stipulation into a meaning beyond all recognition.

The owner became aware that the tenant was, in actuality, never physically returning to the apartment. Instead, family members of the tenant were using the apartment in her complete absence. The owner had never intended to permit a de facto assignment of occupancy from the tenant to her family.

Belkin Burden Wenig & Goldman, LLP was retained by the owner for the purpose of returning to Supreme Court to vacate the stay of the execution of the warrant of eviction.

In opposition, the tenant's attorneys argued that the stipulation was "ambiguous," and urged the Court to resort to parole evidence to examine the parties' alleged intention. Specifically, tenant's counsel pointed to a prior draft of the stipulation showing that the stipulation had originally mandated that the tenant "reside" in the apartment, but that the final version required that the tenant "occupy" the apartment at least a portion of each calendar year. Tenant's counsel asserted that inasmuch as the tenant stored some personal possessions in the apartment and, on occasion, has her family conduct some of her business affairs in the apartment, the occupancy requirement of the stipulation was met. In essence, tenant's counsel claimed that the tenant did, in fact, "occupy" the apartment, notwithstanding her complete physical absence from the apartment.

The Supreme Court (Goodman, J.S.C.), ruled for the tenant, declining to vacate the stay and finding that it was proper to resort to extrinsic evidence because the stipulation was ambiguous. Further, the Court accepted the tenant's contention that the parties never intended that she maintain any personal physical nexus to the apartment.

On appeal, argued before the Appellate Division by my partner, Magda L. Cruz, the Appellate Division unanimously reversed, vacating the stay, so that the owner could recover possession. The appellate court found that a stipulation of settlement is essentially a contract and should be construed in accordance with normal contractual principles. As such, extrinsic evidence is inadmissible to vary the agreement, absent some ambiguity. The Appellate Division found that the replacement of the word "occupy" for the word "reside" did not create any ambiguity; as a result, the Supreme Court had erred, as a matter of law, by its resorting to extrinsic evidence.

The Appellate Division held: "When the language of the disputed paragraph is viewed within the context of the entire document, it is apparent that the interpretation urged by the tenant's son would so strain the common lay and legal usages of the term "occupy" as to place it outside the bounds of any reasonable meaning of the term. We agree with appellants that, although it specifically relieved tenant from the obligation of maintaining the demised premises as her primary residence, the stipulation plainly called for her to be in physical occupancy at least some portion of each year. As it is conceded by respondents that [the tenant] who is in her nineties and lives in Jerusalem, Israel, has not been to the apartment since early 1990, the Court further erred in denying the motion to vacate the stay of execution of the warrant of eviction."

The tenants argued, in the alternative, that even if the stipulation was interpreted in the manner that the owner was urging, the elapse of time now barred the owner from recovering possession. The Appellate Division stated that the tenant's alterative argument alleging laches was unpersuasive. As a result, the stay of eviction was vacated.

In certain respects, this case represents a rather depressing commentary upon human nature; that is, having been granted extra benefits by the owner via a compassionate settlement, the tenant and her family thereafter sought to exploit those terms beyond anything that either party had ever contemplated. However, on a more uplifting vein, this case does demonstrate that, if diligently pursued, the courts will ultimately enforce a stipulation so that the rights and remedies that were actually intended to flow from a negotiated settlement are not, thereafter, abused to create absurd or irrational results.