Eckert v. Connelly (In re Eckert), 2022-50095

CourtNew York Surrogate Court
Writing for the CourtDAVID H. GUY, SURROGATE/ACTING SUPREME COURT JUSTICE
Docket Number2022-50095
PartiesAdministration Proceeding, Estate of James Eckert, a/k/a James R. Eckert, Deceased. v. Tara Connelly, Defendant. Michelle Eckert, Plaintiff,
Decision Date08 February 2022

Administration Proceeding, Estate of James Eckert, a/k/a James R. Eckert, Deceased.

Michelle Eckert, Plaintiff,
v.

Tara Connelly, Defendant.

No. 2022-50095

Surrogate's Court, Broome County

February 8, 2022


Unpublished Opinion

Zachary Morahan, Esq.

Attorney for Michelle Eckert

Coughlin & Gerhart, LLP

David Bamdad, Esq.

Attorney for Tara Connelly

Meltzer, Lippe, Goldstein & Breitstone, LLP

DAVID H. GUY, SURROGATE/ACTING SUPREME COURT JUSTICE

James Eckert died intestate on December 7, 2018. Michelle Eckert is James Eckert's sole surviving child, and Tara Connelly is his surviving spouse. On August 17, 2020, Ms. Eckert filed a petition for letters of administration of the Estate of James Eckert. On September 23, 2020, Ms. Connelly filed a cross-petition for letters of administration, to which Ms. Eckert filed objections on December 7, 2020. Ms. Connelly filed objections to Ms. Eckert's petition for letters on December 14, 2020.

Ms. Eckert filed a verified document, titled as a complaint, with her objections to the Connelly cross-petition for administration on December 7, 2020, alleging the decedent lacked capacity to marry Ms. Connelly on July 31, 2018 and seeking an order declaring the marriage between Ms. Connelly and the decedent null and void.

On March 8, 2021, Ms. Connelly filed a petition for letters of temporary administration for the purpose of accessing any medical and financial records of the decedent. Letters of temporary administration dated March 23, 2021 were issued to Ms. Connelly for that limited purpose.

On March 18, 2021, Ms. Eckert commenced an action in Supreme Court against Ms. Connelly, alleging conversion, undue influence, lack of mental capacity, unjust enrichment, and constructive trust, in relation to certain non-probate retirement accounts held by John Hancock, The Trustee of MATCO Associates, Inc; and Edward Jones Trust Company.

On August 12, 2021, the Court issued an order referring the parties and their counsel to alternative dispute resolution ("ADR"), in accordance with the presumptive Alternative Dispute Resolution Program instituted by Chief Judge Janet DiFiore in 2019. On September 20, 2021, an ADR session was held in person at the Broome County Courthouse with Surrogate's Court Principal Court Attorney, Justin Harby-Conforti, Esq. Ms. Eckert appeared with her attorney, Zachary Morahan, Esq., and Ms. Connelly appeared with her attorney, David Bamdad, Esq. During the ADR session, the parties, with counsel, came to a mutual verbal agreement that Ms. Connelly would pay Ms. Eckert $515, 000 in full settlement of the Surrogate's and Supreme Court matters. The attorneys cancelled previously scheduled depositions with witnesses necessary for further litigation of this matter.

Mr. Harby-Conforti sent an email to the attorneys on September 21, 2021, confirming that the matters had been settled and asking to be informed as to the status of the filing of stipulations of discontinuance. He sent a similar email to the Chief Clerk of the Surrogate's Court to advise her of the settlement.

On September 21, 2021, Eckert's counsel sent an email [1] to Connelly's counsel, stating the following:

I wanted to follow up to the settlement reached at mediation yesterday. We will handle the first draft of the Settlement Agreement and send for your review. Pursuant to the settlement reached, we will incorporate the following terms:

1) $515, 000.00 payment within 20 days of fully signed agreement/stipulations of discontinuance being provided Payment to be made by certified check made payable to Michelle Eckert and delivered to C & G
2) Stipulation of discontinuance with prejudice as to petitions in Surrogate's Court
3) Stipulation of discontinuance with prejudice as to Sup. Ct. action;
4) Non-disparagement provision;
5) Confidentiality provision;
6) Mutual general releases;
7) Affirmation that Michelle and Tara have or will destroy any medical records in their possession.

If there is anything I missed, please let me know. Also, as we discussed yesterday, to the extent we need to be flexible on payment dates to minimize tax implications, we are willing to work in good faith to ensure that tax treatment is minimized by timing.

Connelly's counsel sent a reply email dated September 22, 2021, stating:

Leave the timing of payment open until we have more information. There should also be an indemnification for Tara and, in addition to destroying records in her possession, a representation that Michelle has not provided copies of medical records to any other person. We will provide any other comments we may have when we review the draft agreement.

Eckert's counsel sent a proposed settlement agreement for Connelly's counsel's review, by email dated September 29, 2021. Connelly's counsel replied via email on October 20, 2021, indicating that they had researched the tax implications of the settlement, which would require his client to withdraw from the inherited retirement accounts to make the lump sum payment to Ms. Eckert and "trigger an enormous tax regardless of what year it is done." He concluded, "[W]e cannot settle upon those terms."

Mr. Harby-Conforti independently followed up with counsel for a status update and was informed by counsel on October 27, 2021 that the parties no longer agreed to settle...

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