Varbero v. Belesis

ANTONY VARBERO, Plaintiff, v. ANASTASIOS P. BELESIS, et al., Defendants.

20-cv-2538 (LJL)

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

March 29, 2021

MEMORANDUM AND ORDER

LEWIS J. LIMAN, United States District Judge:

Plaintiff Antony Varbero ("Plaintiff" or "Varbero") moves the Court to enforce a settlement agreement between him and Defendant Anastasios Belesis ("Belesis"). Dkt. Nos. 84-85. For the following reasons, the motion is granted.

BACKGROUND

Plaintiff initiated this action by filing a complaint on March 25, 2020 against Belesis as well as individual defendant Tabitha Belesis and corporate defendants 2008 Anastasios Belesis Irrevocable Trust US Dated Sept. 2008, Tomtab LLC, Crown Enterprises, LLC, and Lugano Ventures, LLC (collectively, "Defendants"), to recover debts allegedly owed to Plaintiff in connection with his legal representation of Belesis beginning in January 2015. Dkt. No. 4 ¶ 16.¹ On October 1, 2020, the Court granted in part Defendants' motion to dismiss but sustained certain claims against each Defendant for breach of contract, aiding and abetting breach ofcontract, and fraudulent conveyance in violation of New York Debtor and Creditor Law Sections 273, 275, and 276. See id. On October 14, 2020, the parties submitted a joint letter, signed by counsel for both parties, stating that "[o]n October 12, 2020 the parties have [sic] reached an agreement to resolve the action[] [w]hereby the Defendants agreed to make 6 installment payments beginning on or before November 1, 2020; with the last payment due on June 15, 2021." Dkt. No. 42. The parties requested that, in light of the settlement, certain outstanding discovery motions be held in abeyance. Id. They further requested that the case "be held open until the June 15, 2021 which is when the final payment is due according to the settlement terms. Holding the case open will preserve Plaintiff's rights and allow for the quick intervention of the Court, should it be necessary." Id. The Court endorsed the parties' motion, ordering that the case be stayed until June 15, 2021. Dkt. No. 43. On November 16, 2020, however, Plaintiff filed a letter motion to reopen the case on grounds that Belesis had failed to make "any of the payments" contemplated in the purported settlement agreement and failed to cure his default within the relevant time period. Dkt. No. 44 at 1. By text order of the same day, the Court granted Plaintiff's motion to lift the stay and reopen the case. The parties proceeded with discovery, and a trial date was set for April 19, 2021. See Dkt. No. 78.

On February 24, 2021, Plaintiff filed the instant motion to enforce the settlement agreement, as executed by Varbero on October 30, 2020 and by Belesis on November 3, 2020. Dkt. Nos. 83-85; Dkt. No. 85-1 ("Settlement Agreement"). Pursuant to the terms of the Settlement Agreement, Belesis is obligated to pay the principal sum of $925,000 to Varbero in installments as follows: the first $100,000 on or before November 1, 2020; the second $100,000 on or before November 15, 2020; and the remaining $725,000 in five installments consisting of four equal payments of $150,000.000 each on or before December 15, 2020, February 1, 2021,March 15, 2021, and May 1, 2021, followed by a fifth and final installment of $125,000 on or before June 15, 2021. Dkt. No. 85-1 ¶ 1. In exchange, within five days of Belesis's timely payments of the entire settlement amount to Varbero, Varbero is obligated to authorize transmission from escrow of a fully executed release releasing all claims in this action against every Defendant, whereupon the parties would file a stipulation of dismissal with prejudice with the Court. Id ¶ 2. The Settlement Agreement states:

Upon the [Belesis]'s timely payment of the Settlement Amount, this Settlement Agreement is intended to resolve to the fullest extent possible the claims asserted in [this action] and any motions, orders, or pending requests for sanctions under Fed. R. Civ. P. 11 or otherwise. To that end, each of the [p]arties represents and warrants that all of his or their claims contemplated for release belong to him or them, and to no other person/entity, that no right, title, or interest to or in any of the claims subject to release or related causes of action has, or will be, assigned, sold, pledged, or otherwise transferred to any third party, whether by written oral agreement or by operation of law or otherwise, and that there are, and shall be, no liens relating to any claims subject to release herein, including any lien for attorneys' fees, that will not be fully satisfied and discharged as a result of this Settlement Agreement. For purposes of clarity and avoidance of doubt, in the event the [Belesis] fails to timely pay the Settlement Amount to the Plaintiff, the Plaintiff specifically reserves any and all rights with respect to the Lawsuit including, without limitation, any motions, orders, or pending requests for sanctions under Fed. R. Civ. P. 11 or otherwise.

Id. ¶ 4.

The Settlement Agreement specifies that neither party admits any wrongdoing or liability by its execution. Id. ¶ 5. It also set forth the consequences of a default:

In the event of any default in payment of any installment of the Settlement Amount with such non-payment remaining incurred for a period of five (5) days following notice thereof, the Plaintiff shall be entitled to entry of a final default judgment against [Belesis] in the full amount of his claims; namely One Million Fifty Thousand Dollars ($1,050,000.00) against [Belesis] less any portion of the Settlement Amount previously paid (the "Default Judgment") plus interest accumulating at a rate of nine percent (9%) per annum. For purposes of clarity and avoidance of doubt, the existence of the Default Judgment against the Defendant shall in no way impact or impair the Plaintiff's ability to pursue joint and several liability in the Lawsuit pursuant to the Complaint . . . from [the Defendants excluding Belesis].

Id. ¶ 6.

The Settlement Agreement also provides for the award of attorney's fees to the prevailing party in the event of any "suit, action, arbitration or other proceeding of any nature whatsoever . . . arising out of or related to this Settlement Agreement." Id. ¶ 15. In such event "the prevailing party will be awarded their reasonable attorneys' fees and costs incurred." Id.

Plaintiff alleges that Belesis has not made any payment under the Settlement Agreement. Plaintiff provided Belesis with notice of default by email on November 9, 2020 and by email and letter on November 15, 2020. Dkt. No. 81 at 5; Dkt. No. 81-2. Plaintiff moves for entry of a judgment against Belesis as contemplated by the Settlement Agreement. Dkt. No. 85 at 2.

DISCUSSION

"A district court has the power to enforce summarily, on motion, a settlement agreement reached in a case that was pending before it." BCM Dev., LLC v. Oprandy, 490 F. App'x 409, 409 (2d Cir. 2013) (quoting Meetings & Expositions Inc. v. Tandy Corp., 490 F.2d 714, 717 (2d Cir. 1974)). A "motion to enforce a settlement agreement is fundamentally 'a claim for breach of a contract.'" Hendrickson v. United States, 791 F.3d 354, 358 (2d Cir. 2015) (citing Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 381(1994)). Accordingly, settlement agreements "must . . . be construed according to general principles of contract law." United States v. Prevezon Holdings, Ltd., 289 F. Supp. 3d 446, 450 (S.D.N.Y. 2018) (citation omitted);see Red Ball Interior Demolition Corp. v. Palmadessa, 173 F.3d 481, 484 (2d Cir. 1999)). Thus, "[o]nly where there is cause sufficient to invalidate a contract, such as fraud, collusion, mistake or accident, will a party be relieved from the consequences of a stipulation made during litigation." Oprandy, 490 F. App'x at 409 (quoting Hallock v. State, 485 N.Y.S.2d 510, 512 (1984)).

Belesis does not argue that the Settlement Agreement is the product of fraud, collusion, mistake, or accident. He does not dispute that he executed the Settlement Agreement on November 3, 2020. Cf. N.Y. C.P.L.R. § 2104 ("An agreement between parties or their attorneys relating to any matter in an action, other than one made between counsel in open court, is not binding upon a party unless it is in a writing subscribed by him or his attorney or reduced to the form of an order and entered."). Nor does he dispute Plaintiff's interpretation of the Settlement Agreement or argue that its terms are ambiguous, which they are not. Cf. Lockheed Martin Corp. v. Retail Holdings, N.V., 639 F.3d 63, 69 (2d Cir. 2011) ("When an agreement is unambiguous on its face, it must be enforced according to the plain meaning of its terms."). Nor does he dispute that he made no payments in satisfaction of the agreement, or that Plaintiff noticed his default on November 9 and 15, 2020.

Rather, Belesis makes two arguments that the Settlement Agreement cannot be enforced: (1) that enforcement would be unjust as "Defendant would owe the same debt to multiple parties" and (2) the promissory notes that are at issue in this litigation "lack the necessary consideration to be enforceable under New York State Law." Dkt. No. 100 at 1. Neither argument is availing.

Both of Belesis's arguments rest on a claim that by this action, Plaintiff is seeking to recover debts that are not owed to him, but that are owed to the law firm Joseph Mure Jr. &Associates ("Joseph Mure") "for legal services rendered by Joseph Mure." Id. Defendant avers "Plaintiff has not submitted [into] the record a single document from Joseph Mure indicating that Joseph Mure has assigned, transferred or set over unto Plaintiff the right to collect legal payment for legal services rendered by Joseph Mure to Belesis, nor has Plaintiff asserted that Joseph Mure has done so." Id. at 1-2. Belesis submits retainer agreements between himself and Joseph Mure for legal services, see Exhibits to Dkt. No. 99, and argues that "Belesis never retained the services of...