High-Low

Vargas v Marquis, 65 AD3d 1332 (App. Div., 2nd, 2009)

In this action, the plaintiff successfully moved for summary judgment
on the issue of
liability in August 2006. Prior to submission of the damages issue to a
jury, the parties entered
into a "high-low" stipulation on the record, the parameters of which
were $275,000 and $25,000.
The jury awarded the plaintiff damages in the sum of $135,000, which was
within the
parameters. Thereafter, the plaintiff presented a judgment to the Clerk
of the Court in the
principal sum of the verdict, plus pre-verdict interest in the sum of
$28,895.72, and costs and
disbursements in the sum of $2,521.57. The total sum of the judgment was
$166,417.29. The
defendants sent a letter to the Clerk opposing entry of the proposed
judgment wherein they
argued, inter alia, in effect, that pursuant to the terms of the
parties' high-low stipulation, the
plaintiff waived a judgment and was obligated to provide a stipulation
of discontinuance and
general release. The Clerk entered the judgment submitted by the
plaintiff. The defendants then
moved to vacate the judgment, essentially repeating the arguments they
had made before the
Clerk. The plaintiff opposed the motion, and the Supreme Court denied
it. We reverse.

As we recently observed in Cunha v Shapiro (42 AD3d 95
[2007]), "[p]arties
entering into high-low agreements are free to craft the terms of their
agreements on the record in
any manner that is mutually acceptable to them" (id. at 104). In
this case, the stipulation
read into the record by defense counsel, to which the plaintiff's
counsel "agreed," was as follows:
"At the conclusion of the case, regardless of what the verdict is,
plaintiff's counsel will give a
stipulation of discontinuance and general release. If the number were
zero, we'll still pay you 25
thousand dollars pursuant to that agreement. If the number is over 275 [*2]thousand, well, the release would be for 275
thousand dollars. And
obviously, if the number is somewhere in between, it will be for
whatever that number was."

Under the particular circumstances of this case, we agree with
the defendants that pursuant
to the terms of the high-low stipulation at issue, the plaintiff's
counsel was obligated to furnish a
stipulation of discontinuance and general release—not to submit a
judgment
containing a substantial amount of interest and costs—"regardless of
what the verdict is"
and for "whatever [the] number was." Since there was no showing that the
high-low stipulation
was the product of fraud, duress, overreaching, or unconscionability,
its terms must stand
(see Shuler v Dupree, 14 AD3d 548, 548-549 [2005]).

The bold is mine.