PETIT-CLAIR et al v. STATE OF NEW JERSEY et al

Filing 114

OPINION. Signed by Judge William J. Martini on 6/29/17. (gh, )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
ALFRED J. PETIT-CLAIR, JR., and
MATTHEW J. PETIT-CLAIR,

Civ. No. 2:14-07082

Plaintiffs,
OPINION

v.
JOHN JAY HOFFMAN, Acting Attorney
General for the State of New Jersey,
MARC LARKINS, Acting Comptroller for the
State of New Jersey,
ROBERT A. ROMANO, Acting Treasurer for
the State of New Jersey, and
CITY OF PERTH AMBOY,
Defendants.

WILLIAM J. MARTINI, U.S.D.J.:
Plaintiffs Alfred J. Petit-Clair, Jr. and Matthew J. Petit-Clair (“Plaintiffs”) bring this
action against the City of Perth Amboy (“Defendant”), alleging violations of the Americans
with Disabilities Act (“ADA”), 42 U.S.C. § 126, et seq. This matter comes before the
Court on Defendants’ motion to enforce settlement. There was no oral argument. Fed. R.
Civ. P. 78(b). For the reasons set forth below, Defendants’ motion to enforce settlement is
GRANTED.
I.

BACKGROUND

On November 12, 2014, Plaintiffs filed a complaint, alleging multiple claims,
including a violation of the ADA. Defendant purportedly violated the ADA “by
completing construction of a municipally owned and operated Marina in Perth Amboy
without providing handicapped accessibility to disabled boaters, and then by refusing to
permit plaintiff . . . to install a handicap lift at his own expense at the boat slip rented by
him so that his son might enjoy boating this last summer.” See Compl. ¶ 1, ECF No. 1.
Plaintiffs filed multiple amended complaints, alleging claims against various government
officials, all of which this Court dismissed except for the ADA claim. See Orders, ECF
Nos. 39, 79. The Court also denied Defendant’s motion for summary judgment. See Order,
ECF No. 89.
1

The parties subsequently entered into extensive settlement discussions, including a
telephone conference mediated by Magistrate District Court Judge Mark Falk on
November 3, 2016. Shortly thereafter, the parties reached a settlement agreement that
entailed “the placement of a handicap lift on a portion of the dock no later than June, 2017,
and payment of $7,500.00 counsel fees . . . .” See Pls.’ Letter 1, ECF No. 101. In January
2017, however, Plaintiffs alleged that they were the victims of Defendant’s bad faith
because it had refused to pay counsel fees to Plaintiff Petit-Clair, Jr. in two other matters.
See Pls.’ Letters, ECF Nos. 103, 106. Plaintiffs formally requested that the Court rescind
the agreement and proceed with litigation. See ECF No. 106 at 2.
For its part, Defendant informed the Court that it had taken affirmative steps to
execute the agreement, including the preparation of a draft settlement release and consent
order, which Defendant forwarded to Plaintiffs for their review on January 10, 2017. See
Def.’s Letter, ECF No. 105. The city formally authorized the settlement for payment on
February 22, 2017. See Council Chambers Agenda 3, ECF No. 109-1. Plaintiffs
maintained their position that they rescinded their offer of settlement prior to the city’s
authorization and that the agreement was not binding. See Pls.’ Letter, ECF No. 109.
Defendant subsequently moved to enforce the settlement. See Mot. for Settlement
Enforcement (“Def.’s Mot.”), ECF No. 110.
II.

LEGAL STANDARD

“It is well settled that a federal court has the inherent power to enforce and to
consider challenges to settlements entered into in cases originally filed therein.” Fox v.
Consol. Rail Corp., 739 F.2d 929, 932 (3d Cir. 1984). “The stakes in summary
enforcement of a settlement agreement and summary judgment on the merits of a claim are
roughly the same—both deprive the party of his right to be heard in the litigation.” Tiernan
v. Devoe, 923 F.2d 1024, 1031 (3d Cir. 1991). For this reason, the Third Circuit applies a
summary judgment standard of review to settlement enforcement. See id. at 1032. A court,
therefore, must treat the non-moving party’s assertions as true and will enforce a settlement
only if the moving party is entitled to enforcement as a matter of law. See id.
State law governs the viability of settlement agreements. See id. at 1032–33. “A
settlement agreement between parties to a lawsuit is a contract.” Nolan by Nolan v. Lee
Ho, 577 A.2d 143, 146 (N.J. 1990). In New Jersey, there is a strong public policy in favor
of settlement agreements. See id. “Consequently, [New Jersey] courts have refused to
vacate final settlements absent compelling circumstances.” Id. The party seeking to
enforce a settlement bears the burden of proving the existence of the agreement in the first
instance. United States v. Lightman, 988 F. Supp. 448, 458 (D.N.J. 1997) (citation
omitted). “In general, settlement agreements will be honored absent demonstration of
fraud or other compelling circumstances.” See Nolan by Nolan, 577 A.2d at 146 (quotation
and citations omitted). “Before vacating a settlement agreement, [New Jersey] courts
require ‘clear and convincing proof’ that the agreement should be vacated.” Id. (citing
DeCaro v. DeCaro, 97 A.2d 658 (N.J. 1953)).

2

III.

DISCUSSION

“A contract is formed where there is offer and acceptance and terms sufficiently
definite that the performance to be rendered by each party can be ascertained with
reasonable certainty.” Lightman, 988 F. Supp. at 458 (citing Weichert Co. Realtors v.
Ryan, 608 A.2d 280 (N.J. 1992)). “That contract is enforceable if the parties agree on
essential terms, and manifest an intention to be bound by those terms.” Id. The parties do
not dispute that they verbally reached a settlement agreement in November 2016. See Pls.’
Br. in Opp’n (“Pls.’ Opp’n”) 8, ECF No. 111 (“Although the initial settlement was verbal
. . . .”); Certification of Counsel in Supp. of Def.’s Mot. to Enforce Settlement (“Def.’s
Cert.”) ¶¶ 9–11. Plaintiffs’ letter from that same period reflects that the essential terms of
the agreement were the construction of a boatlift by June 2017 and payment of $7,500 in
counsel fees. See ECF No. 101. The letter clearly expresses an intention to be bound by
the terms stated therein. The offer was accepted and the parties formed a legally binding
contract through their verbal expressions and Plaintiffs’ subsequent written confirmation.
See Pascarella v. Bruck, 462 A.2d 186, 191 (N.J. Super. Ct. App. Div. 1983), cert. denied,
468 A.2d 233 (N.J. 1983) (“parties may orally, by informal memorandum, or by both agree
upon the essential terms of a contract and effectively bind themselves thereon”) (quoting
Comerata v. Chaumount, Inc., 145 A.2d 471 (N.J. Super. Ct. App. Div. 1958)).
Plaintiffs argue that they rescinded their offer to settle before Defendant perfected
its acceptance by adopting a resolution that approved the agreement. See Pls.’ Opp’n at 4–
7. Plaintiffs correctly state that a municipal government “can ordinarily act only by
adoption of an ordinance or resolution at a public meeting,” which includes “giving consent
to the settlement of litigation.” See City of Jersey City v. Roosevelt Stadium Marina, Inc.,
509 A.2d 808, 815 (N.J. Super. Ct. App. Div. 1986). Defendant argues, however, that its
passage of a resolution was an implied condition precedent of the settlement agreement.
See Reply Br. in Further Supp. of Def.’s Mot. (“Def.’s Reply”) 6–7, ECF No. 112.
In New Jersey, “under general contract law terms may be implied in a contract . . .
because they are necessarily involved in the contractual relationship so that the parties must
have intended them and have only failed to specifically express them because of sheer
inadvertence or because the term was too obvious to need expression.” Palisades Props.,
Inc. v. Brunetti, 207 A.2d 522, 531 (N.J. 1965). “Implied conditions precedent . . . are
applied only where ‘the state of the thing or things which has been destroyed constituted
such an essential and requisite element of the agreement that its destruction or cessation
demolishes the attainment of the vital and fundamental purpose of the contracting parties .
. . .’” See Nye v. Ingersoll Rand Co., 783 F. Supp. 2d 751, 766–67 (D.N.J. 2011) (quoting
Edwards v. Leopoldi, 89 A.2d 264 (N.J. Super. Ct. App. Div. 1952)).
Plaintiffs’ letter demonstrates their familiarity with the resolution process that
Defendant undertakes in approving payments of fees and settlements. See ECF No. 101
(describing how Defendant typically approves payment to Plaintiff through the adoption
of a “Council Resolution”). Plaintiffs undoubtedly understood this requirement when the
parties reached an agreement. The Court, therefore, finds that Defendant’s passage of a
3

resolution approving settlement was an implied condition precedent of the settlement
agreement. Consequently, Plaintiffs were bound to the terms that they verbally agreed to
in November 2016 pending the passage of a resolution, which subsequently occurred in
February 2017. See Pascarella, 462 A.2d at 191.
Plaintiffs next argue that the settlement agreement is unenforceable because
Defendant’s resolution does not reference the construction of the boatlift. See Pls.’ Opp’n
at 7–8. Plaintiffs are correct that the City Council Agenda does not reference construction
of the boatlift; however, the Agenda does not supersede the contract. The parties verbally
formed the contract and then Plaintiffs informally memorialized it in their letter. The final
iteration of the contract was the draft from January 10, 2017, which Defendant sent to
Plaintiffs for their review and comments. See Def.’s Cert. at ¶ 15, Ex. A. That draft
includes the construction of the boatlift, although it does not reference a completion date.
Id., Ex. A at ¶ 11. Plaintiffs could have responded to Defendant and included the date of
completion, June 2017. Instead, Plaintiffs attempted to rescind their “offer,” which was
impossible because the contract was fully formed by that point.
Plaintiffs argue that the contract is unenforceable because certain conditions
precedent were not met. Pls.’ Opp’n at 8–11. Those conditions were Plaintiffs’ receipt of
an executed original of the agreement, $7,500 payment and an executed consent order. Id.
at 9. Plaintiffs fail to note that these conditions were not met because Plaintiffs refused to
respond to Defendant’s draft agreement. Plaintiffs cannot now use their own inaction as a
defense against the enforcement of the contract.
Finally, Plaintiffs assert the doctrine of unclean hands against Defendant due to its
purported bad faith in failing to pay Plaintiff Petit-Clair, Jr.’s counsel fees from unrelated
matters. Plaintiff Petit-Clair, Jr. raised the issue of Defendant’s non-payment in his
November 2016 letter. See ECF No. 101. The letter clearly confirms the terms of
settlement and then subsequently addresses Defendant’s non-payment as a separate
business matter between the parties. Id. The Court finds that payment of these additional
fees was not an essential term of the settlement agreement. Defendant’s non-payment
thereof is, therefore, irrelevant to the validity of the instant agreement. Plaintiffs have not
met their burden of showing clear and convincing proof of fraud or other compelling
circumstances that warrant vacation of the settlement agreement. See Nolan by Nolan, 577
A.2d at 146. Accordingly, the Court finds the settlement agreement enforceable.
IV.

CONCLUSION

For the reasons stated above, Defendant’s motion to enforce the settlement
agreement is GRANTED. An appropriate order follows.
s/William J. Martini
_____________________________
WILLIAM J. MARTINI, U.S.D.J.
Date: June 29, 2017
4