Court Opinion

ID: 5758821
Source: CourtListenerOpinion
Date Created: 2022-01-12 17:10:57.813229+00
Date Added: 2024-06-11T08:41:29.600789
License: Public Domain

Kavanagh, J. (dissenting).
It is well settled that a general release “is a jural act of high significance ... It should never be converted into a starting point for renewed litigation except under circumstances and under rules which would render any other result a grave injustice” (Mangini v McClurg, 24 NY2d 556, 563 [1969]; see Booth v 3669 Delaware, 92 NY2d 934, 935 [1998]). Thus, when “the language of the release is clear, effect must be given to the intent of the parties as indicated by the language employed” (Rocanova v Equitable Life Assur. Socy. of U.S., 83 NY2d 603, 616 [1994] [internal quotation marks and citation omitted]; see Rubycz-Boyar v Mondragon, 15 AD3d 811, 812 [2005], Iv denied 5 NY3d 703 [2005]; J & A Bayly Constr. Co. v Village of Castleton-on-Hudson, 248 AD2d 766, 767 [1998]). Of course, “ ‘[t]he meaning and coverage of a general release necessarily depends upon the controversy being settled and upon the purpose for which the release was given’ ” (Kaminsky v Gamache, 298 AD2d 361, 362 [2002] [citation omitted]; accord Meyer v Fanelli, 266 AD2d 361, 361-362 [1999]; see Smith v AJ Contr. Co., 277 AD2d 305, 306 [2000]). A general release, therefore, may be “avoided with respect to uncontemplated transactions despite the generality of the language in the release form” (Mangini v McClurg, 24 NY2d at 562; see Green v Lake Placid 1980 Olympic Games, 147 AD2d 860, 862 [1989]). Nevertheless, absent fraud, duress or illegality, it is the releasor who “must sustain the burden of persuasion if he [or she] is to establish that the general language of the release, valid on its face and properly executed, is to be limited because of a mutual mistake, or otherwise does not represent the intent of the parties” *531(Mangini v McClurg, 24 NY2d at 563; see Hack v United Capital Corp., 247 AD2d 300, 301-302 [1998]; Calavano v New York City Health & Hosps. Corp., 246 AD2d 317, 319 [1998]).
It is our view that plaintiffs, as the releasors, have not met their burden here. The general release acknowledged that plaintiffs received an assignment from Ellis Hospital of a claim for indemnification that was to be enforced against defendant or defendant’s insurer. The release then unambiguously discharged both Ellis Hospital and defendant—but not defendant’s insurer—from “all” claims “in law or in equity” that “they ever had, now have or may have” arising out of the alleged medical malpractice. This language unequivocally released defendant from its liability for any and all claims of plaintiffs, including the indemnification claim asserted herein, while attempting to preserve plaintiffs’ right to pursue an indemnification claim against defendant’s insurer.
Indeed, plaintiffs concede that the general language of the release seemingly embraces their indemnification claim against defendant. Nevertheless, in the face of defendant’s insurer disclaiming coverage after plaintiffs released defendant from liability, they assert that this language is not controlling when read in the context of other portions of the release. Contrary to plaintiffs’ argument, however, there is no language in the release limiting the types of claims discharged, distinguishing between claims asserted by plaintiffs on their own behalf and those asserted in their role as assignees of Ellis Hospital, or otherwise excepting plaintiffs’ right to sue for indemnification as assignees (see Rubycz-Boyar v Mondragon, 15 AD3d at 812). Furthermore, the release signed by plaintiffs cannot be equated to one in which general language has been held not to bar uncontemplated or unmentioned transactions (see Mangini v McClurg, 24 NY2d at 568-569; Green v Lake Placid 1980 Olympic Games, 147 AD2d at 862). Rather, the release at issue here expressly acknowledged the very claim that plaintiffs now seek to assert and plaintiffs nonetheless failed—despite the assistance of counsel—to limit the scope of the release with respect to defendant (see Rubycz-Boyar v Mondragon, 15 AD3d at 812).
While plaintiffs further assert that the circumstances of the negotiated settlement demonstrate that it does not bar their indemnification claim, we agree with defendant that the context of the release, as set forth both in the general release itself and the open-court stipulation of settlement, supports a conclusion that plaintiffs intended to release all claims against defendant. Inasmuch as defendant was not a party to *532the underlying action, the inclusion of defendant in the general release cannot be characterized as merely inadvertent. In that regard, when plaintiffs’ counsel set forth the stipulation in open court, he expressed plaintiffs’ intent that the indemnification claim “be limited to the extent of any insurance coverage providing benefits or coverage to [defendant].” The written release—first acknowledging the assignment of Ellis Hospital’s claim against defendant and its insurer and then releasing only the hospital and defendant—is consistent with this stated intent that any recovery be limited to defendant’s insurance coverage. Thus, it cannot be said that the open-court stipulation renders plaintiffs’ discharge of defendant in any way ambiguous.
We cannot agree with the majority’s characterization of the open court stipulation as parol evidence. Rather, the open court stipulation constitutes the circumstances under which the parties entered into the settlement agreement—including the written general release—and which we necessarily consider in determining the meaning of the general release (see e.g. Kaminsky v Gamache, 298 AD2d at 362; Smith v AJ Contr. Co., 277 AD2d at 306; Green v Lake Placid 1980 Olympic Games, 147 AD2d at 862). We find nothing in the open court settlement that renders the written general release ambiguous. To the contrary, the open court stipulation reflects only plaintiff Thomas E Caruso’s belief that he was “going to get a right to sue somebody else”—without clarifying whether “somebody else” referred to defendant or its insurer—and the agreement of plaintiffs’ counsel that any recovery by plaintiffs would be limited to defendant’s “insurance coverage.” In that regard, “it is well established that ‘when the meaning of [a] . . . contract is plain and clear ... [it is] entitled to [be] enforced according to its terms . . . [and] not to be subverted by straining to find an ambiguity which otherwise might not be thought to exist’ ” (Uribe v Merchants Bank of N.Y., 91 NY2d 336, 341 [1998] [citation omitted]).
A “look to extrinsic evidence to determine the parties’ intent” (Rubycz-Boyar v Mondragon, 15 AD3d at 812 [emphasis added]; see W.W.W. Assoc. v Giancontieri, 77 NY2d 157, 162 [1990])—the deposition testimony of the insurance representative of both physician Alex Fasquariello and defendant—indicates that the language of the release was designed to limit the assignment to defendant’s insurance policy such that plaintiffs would have no recourse against defendant or Ellis Hospital if insurance cover*533age were to fail.* In similar contexts involving attempts to limit recovery to insurance coverage, however, this Court has repeatedly stated that “a release discharging an insured from all liability relieves the insurer from the duty of indemnification because it effectively eliminates any factual or legal grounds on which the duty to indemnify may be based” (McDonough v Dryden Mut. Ins. Co., 276 AD2d 817, 818 [2000]; see Westervelt v Dryden Mut. Ins. Co., 252 AD2d 877, 879 [1998]; Erdman v Eagle Ins. Co., 239 AD2d 847, 849 [1997], appeal dismissed and Iv denied 90 NY2d 926 [1997]; see also Westchester Fire Ins. Co. v Utica First Ins. Co., 40 AD3d 978, 980 [2007]). In any event, “[i]n cases of doubt or ambiguity, a contract must be construed most strongly against the part[ies] who prepared it”—i.e., plaintiffs—and, thus, even if an ambiguity was found, it would necessarily be resolved in defendant’s favor (Jacobson v Sassower, 66 NY2d 991, 993 [1985]; see 67 Wall St. Co. v Franklin Natl. Bank, 37 NY2d 245, 249 [1975]).
In sum, because the general release unequivocally discharged defendant from any further liability, thereby precluding any claims against defendant’s insurer, it is our view that Supreme Court properly dismissed the complaint (see e.g. Rubycz-Boyar v Mondragon, 15 AD3d at 812-813; L & K Holding Corp. v Tropical Aquarium at Hicksville, 192 AD2d 643, 645 [1993]).
Rose, J., concurs.
Ordered that the order entered June 15, 2007 is affirmed, without costs.
Ordered that the order entered March 13, 2007 is modified, on the law, without costs, by reversing so much thereof as granted defendant’s motion for summary judgment; motion denied; and, as so modified, affirmed.

 While the majority takes issue with our characterization of this testimony, it is our view that the majority’s interpretation fails to recognize the following statement of Supreme Court to Caruso: “And then in the event, in that other lawsuit, there is no money or there’s a determination that they’re not obligated to indemnify Ellis Hospital, all you’re going to get is $4 million.” Under any characterization, Supreme Court’s comments clearly illustrate the understanding that if the right to indemnify does not exist, plaintiffs’ right of recovery is limited and, in our view, the majority’s interpretation of this testimony and the statement of plaintiffs’ counsel regarding the limited extent of coverage is inconsistent with the court’s statement.