New York Law Review

Tag: specific performance

  • People v. Collier, 22 N.Y.3d 429 (2013): Enforcing Plea Agreements Despite Technical Errors

    22 N.Y.3d 429 (2013)

    A guilty plea induced by an unfulfilled promise must either be vacated or the promise honored, with the choice resting in the discretion of the sentencing court, and specific performance of a plea bargain does not foreclose technical divergences so long as the defendant’s reasonable expectations are met.

    Summary

    Andre Collier pleaded guilty to robbery charges in exchange for a specific sentence. After discovering an error in the original sentence (a term below the legal minimum), the trial court resentenced him. Collier then sought to withdraw his plea, arguing the original agreement was violated. The Court of Appeals held that resentencing was proper because Collier ultimately received the benefit of his original plea bargain (a total sentence within the agreed-upon range), even though the technical terms differed. The court emphasized an objective standard for evaluating plea agreements, focusing on reasonable expectations rather than subjective interpretations.

    Facts

    Collier was indicted on five counts of first-degree robbery for separate incidents. He entered a plea agreement to plead guilty to two counts in exchange for a determinate sentence of 25 years on the first count and 5 years on the fifth count, with the possibility of concurrent or consecutive sentencing at the judge’s discretion. At sentencing, the judge imposed the sentences consecutively, for a total of 30 years. Collier later filed a motion arguing the 5-year sentence was illegal because it was below the mandatory minimum for a second felony offender.

    Procedural History

    The Appellate Division initially affirmed the original judgment, holding that Collier had waived his right to appeal the sentence. After Collier’s pro se motion, the Appellate Division vacated the sentence and remitted the case for resentencing or withdrawal of the plea. At resentencing, Collier requested to withdraw his plea, but the prosecution requested resentencing. The trial court resentenced Collier to concurrent terms of 25 years and 10 years, totaling 25 years. The Appellate Division affirmed, holding Collier received a sentence better than his original bargain. The New York Court of Appeals granted leave to appeal and affirmed.

    Issue(s)

    Whether a defendant is entitled to withdraw a guilty plea when a sentencing error is corrected by resentencing, resulting in a total sentence within the range contemplated by the original plea agreement, even if the technical terms of the agreement are not precisely followed.

    Holding

    No, because the resentencing comported with the defendant’s reasonable expectation that he would receive a minimum determinate prison term of 25 years and a maximum determinate prison term of 30 years in exchange for his plea, and he in fact achieved the best outcome allowed by his plea since County Court, upon resentencing, reduced his maximum incarceratory term from 30 to 25 years.

    Court’s Reasoning

    The Court of Appeals reasoned that when a guilty plea is induced by an unfulfilled promise, the sentencing court has the discretion to either vacate the plea or honor the promise. The court emphasized the importance of considering the defendant’s reasonable expectations rather than a strict interpretation of the plea agreement’s technical terms, quoting People v Cataldo, 39 NY2d 578, 580 (1976): “Compliance with a plea bargain is to be tested against an objective reading of the bargain, and not against a defendant’s subjective interpretation thereof.” The court highlighted that the delay since the original plea made it difficult for the prosecution to proceed to trial. In this case, even though the original 5-year sentence was illegal, the resentencing to concurrent terms resulted in a shorter overall sentence than originally contemplated, fulfilling the defendant’s reasonable expectation of a sentence between 25 and 30 years. The Court distinguished People v. Catu, 4 N.Y.3d 242 (2005), explaining that unlike a Catu error which affects the voluntariness of a plea, Collier possessed sufficient information to make an informed choice at the time of his plea.

  • People v. Selikoff, 35 N.Y.2d 227 (1974): Enforceability of Plea Agreements Before Detrimental Reliance

    People v. Selikoff, 35 N.Y.2d 227 (1974)

    A defendant is not entitled to specific performance of a plea agreement if they have not detrimentally relied on the agreement, even if no new facts emerged to justify the court’s change of heart regarding the sentence.

    Summary

    Defendants pleaded guilty based on a judge’s sentencing indication, but the judge later deemed a harsher sentence appropriate. Although the defendants were allowed to withdraw their pleas, they instead sought specific performance of the original agreement. The New York Court of Appeals held that, absent detrimental reliance on the plea agreement, the defendants were not entitled to specific performance because vacating the plea restores them to their original position. The court retains sentencing discretion until the moment of sentencing, provided that the reasons for departing from the agreement are documented.

    Facts

    The defendants entered guilty pleas after the County Court Judge indicated a likely sentence. Prior to sentencing, the Judge reconsidered the nature of the crime and determined that a lengthier sentence was warranted.

    Procedural History

    The defendants appealed, seeking specific performance of the original plea agreement, arguing that no new facts justified the judge’s change in sentencing. The Appellate Division orders were affirmed by the Court of Appeals.

    Issue(s)

    Whether a defendant is entitled to specific performance of a plea agreement when the sentencing court decides to impose a harsher sentence than initially indicated, but allows the defendant to withdraw their plea, and the defendant has not demonstrated detrimental reliance on the original agreement.

    Holding

    No, because absent detrimental reliance on the plea agreement, the defendant is restored to their original position by being allowed to withdraw the plea, and the court retains discretion in fixing an appropriate sentence until the time of sentencing, as long as the reasons for departing from the sentencing agreement are placed on the record.

    Court’s Reasoning

    The Court of Appeals relied on People v. McConnell, which stated that a defendant who has not changed their position is generally only entitled to the vacation of their plea if the court cannot adhere to the promise given. This is because vacating the plea restores them to their initial position. The court emphasized that it retains discretion in fixing an appropriate sentence up until the time of sentencing, citing People v. Farrar. The court also noted that reasons for departing from the sentencing agreement must be placed on the record to ensure effective appellate review, citing People v. Danny G. Because the defendants were afforded an opportunity to withdraw their pleas, didn’t argue detrimental reliance, and the County Court demonstrated proper sentencing criteria for the revised sanction, the Court of Appeals held that the County Court had not abused its discretion as a matter of law. The court stated that the defendants are not entitled to specific performance of the original sentencing representations. The court emphasized that “[a] defendant who has not * * * changed his position will generally be entitled to no more than the vacation of his plea if the court concludes that it cannot adhere to the promise given, for the simple reason that vacating the plea restores him to the same position he was in before the plea was taken”. This highlights the court’s focus on restoring the defendant to their original position absent detrimental reliance.

  • Scheck v. Burger King Corp., 75 N.Y.2d 1031 (1990): Objective Manifestation of Intent to Contract Required

    75 N.Y.2d 1031 (1990)

    A binding contract requires an objective manifestation of intent by all parties to enter into the agreement.

    Summary

    Scheck, the plaintiff, sued Burger King for specific performance of a real estate contract. The defendant, Burger King, argued that no binding agreement existed. The trial court dismissed the complaint, and the Appellate Division affirmed. The New York Court of Appeals affirmed, holding that no objective manifestation of intent to enter into a contract existed because Burger King’s president signed the contract with the understanding that it wouldn’t be delivered until further review, and the plaintiff was informed of issues with the contract’s approval.

    Facts

    Plaintiff and defendant, both not-for-profit corporations, engaged in negotiations for the sale of property owned by the defendant to the plaintiff, who was the lessee. After extensive negotiations, a final draft of the contract was presented to the defendant’s president, Yochman, just before a special membership meeting. The plaintiff had already signed the contract. Defendant’s attorney asked Yochman to sign before the meeting but assured him the contract would not be delivered until further review. Yochman signed, and the plaintiff’s attorney was informed of the signing but also warned of “trouble” and “bad news” regarding the contract’s approval.

    Procedural History

    The plaintiff sued for specific performance after the defendant failed to return the signed contract and stated that no binding agreement had been reached. The trial court dismissed the complaint. The Appellate Division affirmed the dismissal, and the plaintiff appealed to the New York Court of Appeals.

    Issue(s)

    Whether the circumstances surrounding the signing of the contract demonstrated the requisite objective manifestation of intent by both parties to enter into a binding contract for the sale of real property.

    Holding

    No, because the circumstances surrounding the signing of the contract did not demonstrate the requisite objective manifestation of intent by both parties to enter into a binding contract.

    Court’s Reasoning

    The Court of Appeals affirmed the dismissal of the complaint, emphasizing that a contract requires an objective manifestation of intent to be bound. The court relied on the principle articulated in Brown Bros. Elec. Contrs. v Beam Constr. Corp., 41 NY2d 397, 399-400 and Arnold v Gramercy Co., 15 AD2d 762, affd 12 NY2d 687. The court highlighted several key facts: (1) the defendant’s president signed the contract with the understanding that it wouldn’t be delivered until further review; (2) the plaintiff’s attorney was informed contemporaneously about issues with the contract’s approval; and (3) strenuous objections were voiced at the membership meeting after the signing. Because the signed contract was never returned to the plaintiff’s attorney and the deposit was returned, no objective manifestation of intent to be bound existed. The court reasoned that these circumstances, taken together, indicated a lack of mutual assent to the contract’s terms. The court did not find any dissenting or concurring opinions in the provided text.

  • 5303 Realty Corp. v. O & Y Equity Corp., 64 N.Y.2d 313 (1984): Lis Pendens Inapplicable to Stock Sale for Realty Ownership

    64 N.Y.2d 313 (1984)

    A notice of pendency (lis pendens) is not properly filed in an action seeking specific performance of a contract for the sale of stock representing beneficial ownership of real estate; the action must directly affect the title, possession, use, or enjoyment of the real property itself.

    Summary

    5303 Realty Corp. sought to purchase a building. Instead of a direct transfer, the transaction was structured as a stock sale of the entities owning the building, allegedly to avoid taxes. When the deal fell apart, 5303 Realty sued for specific performance and filed a notice of pendency (lis pendens) against the property. The New York Court of Appeals held that the lis pendens was improper because the action was fundamentally about the sale of stock, not a direct claim to the real property itself. The court emphasized the need for strict interpretation of lis pendens statutes due to their potential impact on property alienability.

    Facts

    Plaintiff 5303 Realty Corp. sought to purchase an office building. The building was owned by 41 Fifth Ave. Associates, a limited partnership. The general partner, 41 Fifth Ave. Realty Corp., was wholly owned by O & Y Equity Corp. An agreement was reached where O & Y Equity would sell its shares in Realty Corporation and cause the limited partners to convey their interests, structured this way to avoid real property transfer taxes. The contract linked the stock sale to the property, providing for title warranties, insurance, and representations about the building’s status. After disputes arose, the closing failed, and 5303 Realty sued for specific performance, seeking an order compelling defendants to comply with the contract and deliver title. It simultaneously filed a notice of pendency against the property.

    Procedural History

    The defendants moved to cancel the notice of pendency. The Supreme Court denied the motion, finding the original complaint sufficient to sustain the notice. The Appellate Division affirmed. The New York Court of Appeals reversed the lower courts’ decisions, holding that the notice of pendency should be canceled.

    Issue(s)

    Whether an action to enforce a contract for the sale of ownership interests in a realty-owning entity (structured as a stock sale) may be accompanied by a notice of pendency pursuant to CPLR 6501.

    Holding

    No, because the action, in essence, concerns the sale of stock and does not directly affect the title to, or the possession, use or enjoyment of, the real property itself, as required by CPLR 6501.

    Court’s Reasoning

    The Court of Appeals emphasized that a notice of pendency is a powerful tool that clouds title and restricts alienability, requiring strict compliance with statutory requirements and a narrow interpretation of CPLR 6501. The court traced the history of lis pendens from common law to the present statute, noting its potential harsh impact on innocent purchasers. It stated that courts must review the pleadings to determine if the action falls within the scope of CPLR 6501, focusing on whether the relief requested directly affects title to, or possession, use, or enjoyment of, real property. The court distinguished between actions that directly affect real property and those that merely refer to it. It found that the present action was essentially a suit to enforce a contract to sell stock, even though the corporation’s primary asset was real estate. Quoting Brock v. Poor, 216 N.Y. 387, 401, the court reiterated the principle that “the corporation in respect of corporate property and rights is entirely distinct from the stockholders…even complete ownership of capital stock does not operate to transfer the title to corporate property.” The court rejected the argument that the court should elevate substance over form, stating that permitting a notice of pendency in such cases would create uncertainty and be difficult to apply in diverse corporate structures. The court noted alternative remedies such as attachment or injunction are available to protect the plaintiff’s interests without improperly hindering the alienability of real property. The dissent argued that the economic reality of the transaction was a transfer of real property and that the notice of pendency should be allowed. The dissent also expressed concern that the majority’s decision could create uncertainty regarding the applicability of title insurance, recording acts, and the Statute of Frauds to similar transactions.

  • Madison Investments, Inc. v. Cohoes Industrial Terminal, Inc., 64 N.Y.2d 579 (1985): Effect of Anticipatory Breach on Showing Ability to Perform

    Madison Investments, Inc. v. Cohoes Industrial Terminal, Inc., 64 N.Y.2d 579 (1985)

    Even after a seller’s anticipatory breach of a contract for the sale of real property, the purchaser must still demonstrate that it was ready, willing, and able to perform its obligations under the contract on the closing date to be entitled to specific performance.

    Summary

    Madison Investments, Inc. (plaintiff) sought specific performance of a real estate contract after Cohoes Industrial Terminal, Inc. (defendant) anticipatorily breached the agreement. Although the anticipatory breach relieved the plaintiff of tendering performance, the court held that the plaintiff still had to prove it was ready and able to perform on the original closing date to be awarded specific performance. The plaintiff’s failure to demonstrate its financial capacity to purchase the property on the scheduled date, despite having secured a financing commitment much later, precluded the remedy of specific performance.

    Facts

    The plaintiff and defendant entered into a contract for the sale of real property. The defendant anticipatorily breached the contract before the scheduled closing date. The plaintiff then sued seeking specific performance of the contract, claiming the defendant’s breach excused its need to demonstrate readiness and ability to perform. The plaintiff admitted lacking sufficient funds of its own but claimed it secured a financing commitment from another party. This commitment, however, was obtained nearly a year after the originally scheduled closing date.

    Procedural History

    The Appellate Division found that specific performance was inappropriate. The New York Court of Appeals reviewed the Appellate Division’s order. The Court of Appeals affirmed the Appellate Division’s decision, holding that the plaintiff failed to adequately demonstrate its ability to perform on the closing date.

    Issue(s)

    Whether a purchaser seeking specific performance of a real estate contract, after the seller’s anticipatory breach, must still demonstrate that it was ready, willing, and able to perform its obligations under the contract on the originally scheduled closing date.

    Holding

    Yes, because the purchaser seeking specific performance, even after an anticipatory breach by the seller, must still demonstrate that it was ready, willing, and able to perform its obligations under the contract on the originally scheduled closing date to be entitled to specific performance.

    Court’s Reasoning

    The Court of Appeals relied on the established principle that a party seeking specific performance must demonstrate that it was ready, willing, and able to perform its obligations under the contract. The court acknowledged that the defendant’s anticipatory breach relieved the plaintiff of the obligation to actually tender performance on the closing date. However, it emphasized that this did not eliminate the plaintiff’s burden of proving its capacity to perform had the breach not occurred. The court cited Stawski v. Epstein, 67 AD2d 681, and Friederang v. Aldo Co., 199 App Div 127, for this proposition.

    The court found the plaintiff’s evidence of ability to perform inadequate. The financing commitment obtained from another person was secured nearly a year after the anticipated closing date. The plaintiff presented no other evidence demonstrating its capacity to purchase the property on the relevant date. The Court stated, “Though defendant seller’s anticipatory breach of contract relieved plaintiff purchaser of its obligation to tender performance, this did not discharge plaintiff’s obligation to show that it was ready and able to perform its own contractual undertakings on the closing date, in order to secure specific performance.”

    Because the case was tried on stipulated facts and deposition testimony with no allegations of trial errors, the Court found no reason for a further hearing on the issue of the plaintiff’s ability to perform. The plaintiff had its opportunity to prove its ability to perform and failed to do so.

  • Church of God of Prophecy v. Fourth Church of Christ, Scientist, of Brooklyn, 54 N.Y.2d 742 (1981): Religious Corporation’s Authority to Sell Property

    Church of God of Prophecy v. Fourth Church of Christ, Scientist, of Brooklyn, 54 N.Y.2d 742 (1981)

    A religious corporation must obtain both leave of the court and appropriate denominational authorization as required by section 12 of the Religious Corporations Law before selling any of its real property; a contract to sell is valid only if conditioned upon obtaining such court approval, and a court of equity can inquire into the fairness of the contract and its advantage or disadvantage to the religious corporation.

    Summary

    The New York Court of Appeals affirmed the Appellate Division’s order, holding that a religious corporation cannot sell its real property without court approval and denominational authorization, as stipulated by Religious Corporations Law § 12. While the corporation can enter a contract contingent on obtaining court approval, the court has the power to evaluate the contract’s fairness and its benefits to the corporation. The court found that the sale would not benefit the religious corporation, and therefore, judicial consent was appropriately withheld, invalidating the purported agreement and precluding specific performance or monetary damages.

    Facts

    The Church of God of Prophecy sought to purchase real property from the Fourth Church of Christ, Scientist, of Brooklyn. The Fourth Church of Christ entered into a contract to sell the property. The lower court determined the sale was not in the best interest of the Fourth Church and denied the sale. The Church of God of Prophecy then sued for specific performance.

    Procedural History

    The Supreme Court initially ruled against specific performance. The Appellate Division affirmed, finding that the sale would not benefit the religious corporation or its members. The Church of God of Prophecy appealed to the New York Court of Appeals.

    Issue(s)

    Whether a religious corporation can be compelled to specifically perform a contract to sell its real property when it has not obtained the required court approval and denominational authorization, and when the court determines the sale is not in the best interest of the corporation.

    Holding

    No, because the religious corporation did not obtain the necessary court approval and denominational authorization, and the court determined that the sale was not in the best interest of the corporation.

    Court’s Reasoning

    The court emphasized the requirement of Religious Corporations Law § 12, which mandates both court leave and denominational authorization for a religious corporation to sell real property. While a religious corporation may enter into a contract to sell conditioned upon obtaining court approval, the court retains the power to evaluate the fairness and advantage of the contract to the religious corporation. Citing Muck v. Hitchcock, 149 App. Div. 323, 328-329, the court noted that it has ample power to inquire into the fairness of the contract. The court found that the Appellate Division’s determination that the sale would not promote the purposes of the respondent religious corporation or the interests of its members was supported by the evidence. Because judicial consent was properly withheld, the agreement was invalid, and the plaintiff was not entitled to specific performance or monetary damages. The court stated, “in an action for specific performance, a court of equity “has ample power to inquire into the fairness of the contract and as to its advantage or disadvantage to the religious corporation, and to approve the proposed conveyance and direct it to be made where, upon all the facts, no valid reason appears for refusing such relief.” The court distinguished cases where the requirements of section 511 of the Not-For-Profit Corporation Law were met, but declined to rule on the propriety of granting permission in a proceeding like the present one where all the requirements of section 511 would have been met because approval was not granted.

  • S.E.S. Importers, Inc. v. Pappalardo, 53 N.Y.2d 455 (1981): Specific Performance When Title Defect is Cured by Trial

    S.E.S. Importers, Inc. v. Pappalardo, 53 N.Y.2d 455 (1981)

    A buyer is entitled to specific performance of a real estate contract even if the seller could not convey good title at the originally scheduled closing, provided the title defect is cured by the time of trial, allowing the court to issue an effective judgment for specific performance.

    Summary

    S.E.S. Importers contracted to buy property from Pappalardo, but a tenant’s lease created a title defect at the scheduled closing. S.E.S. sued for specific performance, or, alternatively, for conveyance of the defective title with a price abatement. By the time of trial, the tenant had surrendered the lease. The New York Court of Appeals held that S.E.S. was entitled to specific performance because the title defect was cured before trial. The Court reasoned that the ability to convey good title at the time of the court’s order, not at the originally scheduled closing, is the key factor. A contract clause limiting the buyer’s remedies did not preclude specific performance because it only applied if the seller *could not* convey good title, and at the time of trial, he could.

    Facts

    Pappalardo contracted to sell property to S.E.S. Importers on March 27, 1978. The contract stipulated that S.E.S. was not obligated to close until a pending eviction action against tenants Simonetti and Moscatiello was resolved in Pappalardo’s favor. The contract also contained a clause limiting S.E.S.’s remedies if Pappalardo could not convey good title, allowing S.E.S. to either accept the title as is or rescind the contract. At the originally scheduled closing on September 29, 1978, the Simonetti-Moscatiello tenancy remained unresolved, creating a title defect.

    Procedural History

    S.E.S. sued for specific performance, or, failing that, conveyance of the title with an abatement of the purchase price. The trial court ruled that S.E.S. was only entitled to the return of its deposit because it had sought a remedy (abatement) inconsistent with the contract’s limitations. The Appellate Division affirmed. The Court of Appeals reversed, holding that S.E.S. was entitled to specific performance.

    Issue(s)

    Whether a buyer is entitled to specific performance of a real estate contract when a title defect existing at the originally scheduled closing is cured by the time of trial.

    Holding

    Yes, because the relevant time for determining whether specific performance is available is the time of trial, not the originally scheduled closing, provided the seller is able to convey good title at the time the court makes its order.

    Court’s Reasoning

    The Court of Appeals reasoned that the ability of the seller to convey good title at the time of the court’s order is the determining factor in granting specific performance. The Court cited Haffey v. Lynch, 143 N.Y. 241, stating that a seller can be compelled to perform if they perfect their title while an action for specific performance is pending. The Court emphasized that equity courts decide cases based on the circumstances at the time the case is before them. The Court stated, "A plaintiff in an equity action should not lose his day in court because of any defense interposed to his action, if at the time of the trial, the facts are such that if he then commenced his action, he would be entitled to the equitable relief sought." Because the tenant had surrendered the lease prior to trial, the title defect was cured. The clause limiting the buyer’s remedies to accepting the title as is or rescinding the contract did not preclude specific performance because it only applied if the seller could not convey good title, and at the time of trial, Pappalardo could. The dissent argued that the buyer should have been forced to elect its remedy (accept title or rescind) at or shortly after the failed closing, and that the buyer’s lawsuit, seeking abatement, constituted a rejection of the contract’s terms. The majority rejected this argument, noting that the parties sharply disagreed on whether the title was defective at the closing, and resolution of that disagreement required judicial intervention.

  • Landau v. County of Putnam, 48 N.Y.2d 439 (1979): Enforceability of Municipal Contracts Affected by Undisclosed Conflicts of Interest

    Landau v. County of Putnam, 48 N.Y.2d 439 (1979)

    A party who contracts with a municipality, knowing a municipal employee has an undisclosed conflict of interest as required by General Municipal Law § 803, cannot enforce the contract against the municipality.

    Summary

    Landau sought specific performance of a land sale contract with Putnam County. Frank Barbarita, a county employee, acted as the real estate broker but did not disclose his interest as required by General Municipal Law § 803. Landau knew of Barbarita’s role and the lack of disclosure. The New York Court of Appeals held that because Landau knew of the undisclosed conflict of interest, they could not enforce the contract against the county. The court reasoned that allowing enforcement would undermine the purpose of conflict of interest laws, which are designed to protect the public from contracts influenced by self-serving municipal officers.

    Facts

    The County of Putnam needed a new garbage disposal site because the Town of Carmel’s site was closing. Town Supervisor Thomas Bergin contacted real estate broker Frank Barbarita about a “for sale” sign on Landau’s 50-acre property. Barbarita arranged meetings between Bergin and Landau, resulting in an agreement for the county to purchase the land. Barbarita was a part-time, salaried County Director of Civil Defense. Prior to signing the contract, Barbarita expressed concerns about receiving a commission to Bergin and the County Attorney, suggesting it could be “embarrassing.” The contract falsely stated that “no broker [was] in any way concerned with the transfer of this realty” to conceal Barbarita’s involvement and expected fee.

    Procedural History

    After the State Investigation Commission revealed Barbarita’s participation, the county rescinded its approval of the purchase contract. Landau sued for specific performance. The trial court ruled in favor of Landau, but the Appellate Division reversed, finding Barbarita’s undisclosed interest nullified the contract and that enforcing the contract would violate public policy. Landau appealed to the New York Court of Appeals.

    Issue(s)

    Whether a contract with a municipality is enforceable by the seller when the seller knows that a municipal employee has an undisclosed interest in the contract in violation of General Municipal Law § 803, even if that interest is not a prohibited interest under General Municipal Law § 801.

    Holding

    No, because Landau’s knowledge of, and participation in, the concealment of Barbarita’s interest in the contract bars their petition for the equitable remedy of specific performance. Allowing enforcement would frustrate the purpose of General Municipal Law Article 18.

    Court’s Reasoning

    The court clarified that General Municipal Law § 804, which nullifies contracts, applies only to “prohibited interests” as defined in § 801 (i.e., where the municipal officer has the power to negotiate, approve, or audit the contract). Barbarita did not have such power. However, the court emphasized that compliance with the disclosure requirement of § 803 is crucial. The court stated that the purpose of Article 18 of the General Municipal Law is “to protect the public from municipal contracts influenced by avaricious officers.” Since Landau knew of Barbarita’s duty to disclose his expected broker’s fee, and actively participated in concealing it by signing the contract with a false statement, enforcing the contract would be against public policy. The court reasoned that “[p]laintiffs’ knowledge of and participation in Barbarita’s failure to fulfill the obligation imposed on him by section 803 infected the rights created in them by the agreement and serves to bar their petition for the equitable remedy of specific performance.” The court explained that Barbarita, as an agent of the county, had a duty of loyalty. By knowingly participating in Barbarita’s violation of that duty and of his statutory duty of disclosure, Landau could not benefit from the transaction. The court quoted United States v. Mississippi Val. Co., 364 U.S. 520, 563, stating that the consequences of violating these duties “militates against enforcement of the contract”.

  • People v. McConnell, 49 N.Y.2d 340 (1980): Enforceability of Plea Bargains After Defendant’s Detrimental Reliance

    People v. McConnell, 49 N.Y.2d 340 (1980)

    When a defendant detrimentally relies on a plea agreement by testifying before a grand jury and at trial, resulting in the indictment and conviction of codefendants, specific performance of the plea agreement is required unless new information reveals the defendant’s conduct was substantially more egregious than initially understood.

    Summary

    McConnell pleaded guilty to manslaughter in the second degree with an agreed-upon sentence of no more than 10 years, in exchange for his testimony against codefendants. He testified before a grand jury, resulting in indictments, and at the trial of one codefendant, resulting in a conviction. Two other codefendants pleaded guilty based on his availability as a witness. The trial judge, however, imposed a 15-year sentence, stating he learned during the trial that McConnell had stabbed the victim. The Court of Appeals held that McConnell was entitled to specific performance of the plea bargain, because his extensive cooperation had placed him in an irreversible position, and the new information about the stabbing did not warrant overriding the agreement given his level of cooperation.

    Facts

    McConnell, along with Carroll, Rock, and Bridges, were airmen. Following a night of heavy drinking and drug use, McConnell, Carroll, and Hasman (the victim) went to a deserted road where Hasman was fatally beaten. McConnell’s attorney agreed with the prosecutor that if McConnell testified before the grand jury and in subsequent proceedings, the prosecutor would accept a guilty plea to manslaughter in the second degree (punishable by up to 15 years) and recommend a maximum sentence of 10 years. The County Judge concurred, stating that if McConnell testified truthfully, he would not consider a sentence greater than 10 years.

    Procedural History

    McConnell testified before the grand jury, resulting in indictments against him and the others. Rock and Bridges pleaded guilty. McConnell testified at Carroll’s trial, and Carroll was convicted. The prosecutor recommended the agreed-upon 10-year maximum sentence for McConnell, but the County Judge imposed a 15-year sentence based on information learned at Carroll’s trial that McConnell had stabbed the victim. McConnell’s motion to vacate the sentence was denied. The Appellate Division affirmed, but noted they would vacate the sentence and allow withdrawal of the plea; however, McConnell’s attorney expressly stated he did not seek that relief. The Court of Appeals then heard the case.

    Issue(s)

    Whether a trial judge abuses discretion by imposing a 15-year sentence on a defendant who pleaded guilty to manslaughter with a 10-year maximum agreement, where the defendant testified before the grand jury (resulting in indictments), testified at a codefendant’s trial (resulting in a conviction), and whose availability to testify led other codefendants to plead guilty, based on information learned at trial that the defendant had stabbed the victim?

    Holding

    Yes, because McConnell had detrimentally relied on the plea agreement by providing substantial cooperation, placing himself in a “no-return position,” and the additional information concerning the stabbing did not justify overriding the plea agreement.

    Court’s Reasoning

    The court emphasized the importance of plea bargaining and ensuring defendants can rely on agreements made on the record. Citing People v. Selikoff, the court acknowledged that sentence promises are conditioned on the appropriateness of the sentence based on subsequently received information. However, a sentencing judge must exercise sound judicial discretion, considering the integrity of the criminal justice system. Because McConnell had changed his position so significantly by testifying, he could not be restored to his original position. The court distinguished the case from situations where vacating the plea would be sufficient because McConnell waived his right to trial and his privilege against self-incrimination. The court found the additional information – that McConnell had stabbed the victim – was not significant enough to justify breaking the plea agreement, especially considering that the judge believed McConnell had missed when stabbing the victim. The court stated: “Use of a knife adds little to the heinousness of taking Hasman’s life by beating, punching or kicking, especially when one recalls that it followed an orgy of drink and drugs.” The court held that “a promise made by a State official authorized to do so and acted upon by a defendant in a criminal matter to his detriment is not lightly to be disregarded.” The court also noted that enforcing the plea bargain benefited the state by ensuring cooperation in future cases and addressing staleness issues with the indictment. Specific performance of the plea bargain was deemed a matter of “essential fairness”.

  • Lucenti v. Cayuga Apartments, Inc., 48 N.Y.2d 530 (1979): Specific Performance with Abatement After Property Damage

    48 N.Y.2d 530 (1979)

    When a building is substantially damaged by fire prior to the closing of title, and the real estate contract contains no risk of loss provision, the purchaser may obtain specific performance with an abatement of the purchase price.

    Summary

    This case concerns the right of a purchaser to seek specific performance with an abatement of the purchase price when a building on the property is substantially damaged by fire before the title closing. The New York Court of Appeals held that General Obligations Law § 5-1311, also known as the Uniform Vendor and Purchaser Risk Act, does not prevent a purchaser from seeking specific performance with an abatement, even when a material part of the property is destroyed. The statute provides the purchaser the *option* to rescind the contract. The court reasoned that the statute was intended to protect purchasers, not to limit their remedies beyond rescission.

    Facts

    Plaintiff entered into a contract to purchase two adjacent parcels of land, each with a building. One week after the contract was signed, one of the buildings was substantially damaged by fire. The defendant (seller) proposed modifying the contract to allow the plaintiff to collect insurance proceeds for reconstruction. Plaintiff did not formally accept this modification but waited for the insurance settlement. The seller later attempted to refund the plaintiff’s deposit, which the plaintiff refused, seeking to proceed with the purchase at an abated price.

    Procedural History

    The trial court dismissed the plaintiff’s complaint, holding that the statute required either rescission or specific performance without abatement. The Appellate Division reversed and remitted for a determination of the abatement amount. On remand, the trial court fixed an abatement, which the Appellate Division later modified, increasing the abatement amount. The Court of Appeals affirmed the Appellate Division’s order.

    Issue(s)

    Whether General Obligations Law § 5-1311 precludes a purchaser from seeking specific performance with an abatement of the purchase price when a material part of the property is destroyed by fire prior to the transfer of title or possession, and the contract contains no specific risk of loss provision.

    Holding

    No, because General Obligations Law § 5-1311 provides the vendee with a privilege to rescind, it does not eliminate the common-law option of specific performance with abatement.

    Court’s Reasoning

    The Court of Appeals examined the legislative history and purpose of General Obligations Law § 5-1311, noting its origins in the Uniform Vendor and Purchaser Risk Act. The court found that the statute was primarily intended to allocate the risk of loss between the vendor and purchaser, particularly in response to the common-law rule established in Paine v. Meller, which placed the risk on the purchaser. The court emphasized that the statute specifically allows the *purchaser* to rescind the contract if a material part of the property is destroyed, but it does not explicitly address or prohibit the remedy of specific performance with abatement. The Court noted that the Law Revision Commission’s report contained a gratuitous assessment that the deal should be called off upon destruction of a substantial part of the property, but this was incorrect. The court also relied on precedents such as World Exhibit Corp. v. City Bank Farmers Trust Co., which affirmed a purchaser’s right to seek specific performance with abatement under similar circumstances. The court reasoned that, because the legislature is presumed to know the existing judicial construction of a statute when reenacting it, the reenactment of § 5-1311 without changes impliedly adopted the interpretation that allowed for specific performance with abatement. The court quoted Matter of Scheftel, stating, “the Legislature is presumed to have had knowledge of the construction which had been placed on the provision * * * and in adopting in these re-enactments the language used in the earlier act, must be deemed to have adopted also the interpretation of the legislative intent decided by this court, and to have made that construction a part of the re-enactment”. Therefore, the Court concluded that the statute did not eliminate the purchaser’s common-law right to seek specific performance with a corresponding reduction in the purchase price to account for the damage. The seller argued that the purchaser abandoned the contract, but the Court found that the weight of the evidence supported the Appellate Division’s factual conclusions that the purchaser did not abandon the contract. The court noted the continuing negotiations between the parties and the seller’s agreement to await the insurance settlement before resolving the matter. Finally, the court approved of the Appellate Division’s revised abatement figure, which was based on the seller’s own valuation statements submitted in the insurance claim.