Lawyers often spend months (or years) battling a case on a client's behalf, with the matter often getting resolved shortly before trial. The terms of that resolution will usually be embodied in a written form known as a "settlement agreement" or "stipulation of settlement."
If they're not careful, lawyers can also end up spending months (or years) battling what was meant by the words or phrases they employed in those settlement documents.
By way of example, in Widewaters Property Development Co., Inv. v. Katz , Widewaters had sued Katz (and others) for violating a settlement agreement which required the defendants to correct certain soil and groundwater contamination. It was Widewaters' contention that the settlement required the defendants to use their "best efforts" to complete the work, and that the defendants had breached that obligation.
Defendants moved to dismiss the complaint and alternatively sought summary judgment -- a formal adjudication on the merits of the dispute, based solely on the court's review of the submitted documents. The Plaintiff later moved to dismiss the defendant's counterclaim which alleged "tortious interference with contract." The Onondaga County Supreme Court partially granted the defendant's request by dismissing certain allegations that appeared in plaintiff's pleadings, but otherwise denied the parties' requests.
Since the parties' agreement failed to define what was meant by the term "best efforts," the Appellate Division, Fourth Department, affirmed the denial of summary judgment. The AD4 did not believe that that part of the dispute was resolvable by way of motion practice, since what comprises "best efforts" is often a "question of fact," requiring a formal hearing or trial.
Interestingly, the defendant also sought to recoup its legal fees incurred in making the motion. While the parties' settlement agreement provided that such fees were recoverable "to the extent such party prevails on the merits with regard to any litigation arising from or related to this Settlement Agreement," the appellate court did not believe that the dismissal of only a portion of the plaintiff's complaint triggered an entitlement to recoup costs, particularly in view of the litigation's ongoing nature.
Finally, the AD4 reversed the Supreme Court's refusal to dismiss the "tortious interference" counterclaim. In the absence of meddling by a "stranger," or third party, that counterclaim was unsustainable.
That concludes our best efforts to analyze this case!
For a copy of the Appellate Division's decision, please use this link: Widewaters Property Development Co., Inv. v. Katz