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PRIOR RESULTS DO NOT GUARANTEE A SIMILAR OUTCOME

#293 Third Department Caselaw Round-Up for January 26, 2012, Part 3 of 3

February 17, 2013

152 Post-1 01-26-12, Part 3 Third Department January.pngThis case very nicely illustrates that if the parties to an agreement want something included or excluded from the agreement, then they had damned well better make sure that the language used in the agreement is specific enough so that a court, when asked to interpret the agreement, does so in a way that both parties intended.

This case also illustrates why all legal documents need to be extremely carefully drafted and proof-read multiple times. The appellant in this case found that out the hard way.


152 Post-2 Schoharie County.pngCase #142
#512772
Dagliolo v. Dagliolo, ___ A.D.3d ___, ___ N.Y.S.2d ___
Schoharie Supreme - Devine
Issues: Divorce; Pension; Stipulation
Cited statutes: None
Affirmed

The parties were divorced in 2002. Within the judgment of divorce was a stipulation of settlement through which the parties had agreed to the distribution of the appellant-ex-wife's pension, pursuant to what is called the Majauskas formula.

In 2010, the respondent-ex-husband made a motion for the "entry of a proposed domestic relations order granting hum survivor benefits in the [ex-wife's] pension." The court granted the motion and ordered the ex-wife to "grant [the ex-husband] survivor benefits in her pension and not to select any pension option that would not grant [the ex-husband] lifetime benefits."

The ex-wife appealed, claiming that "the domestic relations order cannot grant [the ex-husband] survivor benefits as the underlying stipulation did not provide [the ex-husband] with such benefits."

So, right off the bat, it is clear that the ex-wife's impression of her agreement with the ex-husband is that "we never agreed to that!" So, it was probably to her great surprise for her to learn that she had, in fact, done just that.

The court very neatly analyzes the problem.

First, it is well-settled that a domestic relations order may only convey those rights which were specifically set forth in a valid stipulation of settlement.

Second, a stipulation of settlement is subject to being interpreted as one would interpret any other contract.

Third, "if the language of a stipulation is unambiguous, its terms are given their plain and ordinary meaning, and the parties' intent is determined without resort to extrinsic evidence."

So, what does the stipulation say on this point?

The stipulation states that the ex-wife "shall opt to have said pension throughout the life of [the ex-husband] and [the ex-wife]." Thus, the stipulation clearly states that the gauge for the pension is not merely the ex-wife's life, but also the life of the ex-husband. If the ex-husband dies before the ex-wife, then there is no problem here. But, if the ex-wife dies before the ex-husband, then there is clearly a right of survivorship vested in the ex-husband with regard to the ex-wife's pension.

In my opinion, it seems that the ex-wife (and her attorney!?) probably interpreted this sentence to mean that the pension had to be measured by the lives of both parties and that, in the event one of the parties died, this directive would no longer be valid. The problem is that that is not what the sentence states. And, any court, when called upon to interpret a contract, is going to interpret the contract's terms "given their plain and ordinary meaning".

This is exactly why the language in most contracts is so painfully precise and why words, terms, and phrases are specifically defined. And this is why attorneys have to be excruciatingly careful in how they draft every single word of a contract.


Caselaw Round-Up Score Card:

Affirmed: 97 (68.31%)
Decision Withheld: 6 (4.23%)
Dismissed: 8 (5.63%)
Modified: 11 (7.75%)
Reversed: 19 (13.38%)

Total: 142