Carlson v. Colangelo

221 A.D.3d 773

199 N.Y.S.3d 185

Kristine M. CARLSON, appellant,

v.Crissy COLANGELO, etc., et al., respondents.

2022–01840

Index No. 50095/19

Supreme Court, Appellate Division, Second Department, New York.

Submitted—May 18, 2023

November 15, 2023

McCarthy Fingar LLP, White Plains, NY (Frank W. Streng and Irma K. Nimetz of counsel), for appellant.

Piscionere & Nemarow, P.C., Rye, NY (Anthony G. Piscionere and Michael J. Konicoff of counsel), for respondents.

COLLEEN D. DUFFY, J.P., VALERIE BRATHWAITE NELSON, CHERYL E. CHAMBERS, BARRY E. WARHIT, JJ.

DECISION & ORDER

In an action, inter alia, for declaratory relief, the plaintiff appeals from an order of the Supreme Court, Westchester County (Charles D. Wood, J.), dated March 2, 2022. The order granted the defendants’ motion for summary judgment dismissing so much of the complaint as related to certain real property and an income stream set forth in paragraph 6(b) of the trust agreement for the Donald P. Dempsey Revocable Trust and, in effect, declaring that the plaintiff is not entitled to the income stream set forth in paragraph 6(b) of the trust agreement for the Donald P. Dempsey Revocable Trust, and for an award of attorneys’ fees, and denied the plaintiff's cross-motion for summary judgment on the first cause of action, in effect, on so much of the fourth cause of action as related to the real property and the income stream set forth in paragraph 6(b) of the trust agreement for the Donald P. Dempsey Revocable Trust, and declaring that she is entitled to the income stream set forth in paragraph 6(b) of the trust agreement for the Donald P. Dempsey Revocable Trust.

ORDERED that the order is modified, on the law, by deleting the provision thereof granting that branch of the defendants’ motion which was for an award of attorneys’ fees, and substituting therefor a provision denying that branch of the motion; as so modified, the order is affirmed, without costs or disbursements.

In January 2019, the plaintiff commenced this action against the defendant Crissy Colangelo, individually and as trustee of the Donald P. Dempsey Revocable Trust, and the defendant Dempsaco, LLC (hereinafter Dempsaco), to enforce provisions of the trust agreement which she alleged bequeathed certain real property to her and provided a stream of income to her. The plaintiff sought, inter alia, declarations that she is entitled to an income stream set forth in paragraph 6(b) of the trust agreement and "is a 50% member of Dempasco" and a full accounting of the operations of Dempsaco. The trust agreement contained an in terrorem clause, extinguishing the rights of any challenger who contested the distribution of Dempsey's assets in any way.

The defendants moved for summary judgment dismissing so much of the complaint as related to the real property and the income stream and, in effect, declaring that the plaintiff is not entitled to the income stream, and for an award of attorneys’ fees, contending that the plaintiff had triggered the in terrorem clause in the trust agreement. The plaintiff opposed the motion and cross-moved for summary judgment on the first cause of action, in effect, on so much of the fourth cause of action as related to the real property and the income stream, and declaring that she is entitled to the income stream. In an order dated March 2, 2022, the Supreme Court granted the defendants’ motion and denied the plaintiff's cross-motion. The plaintiff appeals.

Although they are not favored and must be strictly construed, "[i]n terrorem clauses ... are enforceable" ( Matter of Ellis, 252 A.D.2d 118, 127, 683 N.Y.S.2d 113 ; see Matter of Singer, 13 N.Y.3d 447, 451, 892 N.Y.S.2d 836, 920 N.E.2d 943 ). "No statute governs in terrorem clauses with respect to trusts, as opposed to wills; nevertheless, statutes and case law pertaining to wills are instructive" ( Matter of Neva M. Strom Irrevocable Trust III, 203 A.D.3d 1255, 1256, 164 N.Y.S.3d 293 ; see Matter of Tumminello v. Bolten, 59 A.D.3d 727, 728, 873 N.Y.S.2d 731 ). "The cardinal rule of construction of a will and, concomitantly, of an in terrorem clause, is to carry out the intent of the testator" ( Matter of Ellis, 252 A.D.2d at 127, 683 N.Y.S.2d 113 ; see Matter of Singer, 13 N.Y.3d at 451, 892 N.Y.S.2d 836, 920 N.E.2d 943 ; Matter of Tumminello v. Bolten, 59 A.D.3d at 728, 873 N.Y.S.2d 731 ). "The intention must be gathered from all of the surrounding circumstances and the writings interpreted according to the purpose which the parties had in mind" ( Matter of Cook, 244 N.Y. 63, 69, 154 N.E. 823 ; see Matter of Ellis, 252 A.D.2d at 128, 683 N.Y.S.2d 113 ).

Here, the defendants established their prima facie entitlement to judgment as a matter of law dismissing so much of the complaint as related to the real property and the income...