Birches at Schoharie, L.P. v. Schoharie Senior Gen. Partner LLC

• Decision Date: 21 February 2019
• Docket Number: 526549
• Parties: BIRCHES AT SCHOHARIE, L.P., et al., Appellants, v. SCHOHARIE SENIOR GENERAL PARTNER LLC, Respondent.
• Court: New York Supreme Court — Appellate Division

169 A.D.3d 1192
94 N.Y.S.3d 412

BIRCHES AT SCHOHARIE, L.P., et al., Appellants,
v.
SCHOHARIE SENIOR GENERAL PARTNER LLC, Respondent.

526549

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

Calendar Date: January 14, 2019
Decided and Entered: February 21, 2019

94 N.Y.S.3d 413

Harris Beach PLLC, Albany (Elliot A. Hallak of counsel), and Holland & Knight, LLP, New York City, for appellants.

Powers & Santola, LLP, Albany (Michael J. Hutter of counsel), and Cooper Erving & Savage LLP, Albany, for respondent.

Before: Garry, P.J., Egan Jr., Lynch, Clark and Pritzker, JJ.

MEMORANDUM AND ORDER

Lynch, J.

169 A.D.3d 1192

Appeal from an amended order of the Supreme Court (Gilpatric, J.), entered April 10, 2018 in Ulster County, which denied plaintiffs' motion to enter judgment in accordance with the parties' settlement.

This case arises out of a partnership dispute involving the construction of an affordable senior housing community called Birches at Schoharie (hereinafter the project). The project is owned by plaintiff Birches at Schoharie, L.P. (hereinafter the partnership). The partnership includes defendant, as the initial managing partner, plaintiff Banc of America CDC Special Holding Company, Inc. (hereinafter SHC), as a special limited partner, Schoharie Housing Corporation as a general partner, and Bank of America, N.A. as the investor limited partner. Defendant operates through its manager, Steve Aaron.

In May 2014, the partnership and SHC commenced this action against defendant in Ulster County seeking, in part, to

169 A.D.3d 1193

have SHC take over as controlling managing partner. On October 19, 2017, the parties placed a settlement on the record in open

94 N.Y.S.3d 414

court requiring Aaron to pay Bank of America, N.A. $675,000 in two equal installments of $377,500. The first payment was due November 8, 2017 and the second by November 30, 2017. In turn, SHC and Bank of America, N.A., in its sole capacity as investor limited partner, agreed to transfer their partnership interest to defendant or an affiliate of its choice. Defendant agreed to indemnify and hold harmless Bank of America, N.A. in its capacity as an investor limited partner. Defendant also acknowledged that time was of the essence as to the payments and agreed to provide a confession of judgment for any failed payment. The settlement required a "full release of all claims which were raised or could have been raised" in the action. It excluded any claims related to a separate mortgage foreclosure action pending in Schoharie County that Bank of America, N.A. – which was not a party to this action – commenced against defendant. Plaintiffs agreed to prepare the assignment documents and to cooperate in confirming with the Secretary of State that defendant remained as managing partner. Finally, the settlement provided that the action would be dismissed as of October 19, 2017, "subject to the [c]ourt's retention of jurisdiction to enforce the terms of the settlement that [was being placed] on the record today." Plaintiffs' counsel concluded the terms by stating, "The parties have also agreed that this court record and settlement today is a...