A Stipulation Made In Open Court Will Probably Rust If Left In The Rain
I have never happily allowed a client to enter into a stipulation with provisions which he or she will probably not be able to keep. Also, while I wholeheartedly subscribe to the maxim that "A bad settlement is better than a good lawsuit", I try to be careful that the "bad" provisions of a stipulation are not so awful that my client cannot ultimately digest them. It is important to keep in mind that a stipulation is a private contract, not lightly set aside by the court. That is even more so the case where the stipulation is made in open court and on the record.
The decision rendered by the 3rd Department of the Supreme Court's Appellate Division in the Estate of McLaughlin, reported here is a good cautionary tale of what happens when the client is not totally on board as to the terms and conditions of a settlement. In this particular case the objecting party resided in California and was represented by counsel with the authority to enter into a binding agreement.
The Appellate Division took the time-honored position that "a deal is a deal" and that absent establishing that the stipulation was unconscionable or the product of fraud, collusion or mutual mistake (here the "mistake" alleged by petitioner was hers alone), a stipulation will not be set aside by the court. Here the petitioner was offered $125,000 in full settlement of her claim against the estate but she later balked at executing a release when she learned that she would not also be receiving collectibles from the estate as she believed was the case.
The lessons here were painful for the Petitioner and should be obvious for you.It is of the greatest importance for counsel to be certain that the client has a complete understanding of the agreement and what to expect. Keep in mind that not only does a client lack the legal training which may be needed to understand an agreement absent the guidance of skilled counsel, but also the best of us can get flustered an overlook details in matters where we are legally and emotionally involved. Once a stipulation is executed, it is usually too late to go back and make changes.