April 16, 2009
TATIANA CABRERA-RENNE, PLAINTIFF-APPELLANT,
CITY OF PATERSON, AND PATERSON POLICE DEPARTMENT, DEFENDANTS-RESPONDENTS, AND JOSE TORRES, INDIVIDUALLY AND IN HIS CAPACITY AS MAYOR OF THE CITY OF PATERSON, LAWRENCE SPAGNOLA, INDIVIDUALLY AND IN HIS CAPACITY AS CHIEF OF POLICE OF THE PATERSON POLICE DEPARTMENT, JAMES WITTIG, INDIVIDUALLY AND IN HIS CAPACITY AS ACTING CHIEF OF THE PATERSON POLICE DEPARTMENT, MICHAEL WALKER, INDIVIDUALLY AND IN HIS CAPACITY AS DIRECTOR OF THE PATERSON POLICE DEPARTMENT, RAY BENEDETTO, INDIVIDUALLY AND IN HIS CAPACITY AS CAPTAIN OF THE INTERNAL AFFAIRS DIVISION OF THE PATERSON POLICE DEPARTMENT, AND ELI BURGOS, INDIVIDUALLY AND IN HIS CAPACITY AS AN OFFICER OF THE AFFIRMATIVE ACTION DIVISION OF THE PATERSON POLICE DEPARTMENT, DEFENDANTS.
On appeal from the Superior Court of New Jersey, Law Division, Passaic County, Docket No. L-3861-05.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted: March 11, 2009
Before Judges Axelrad and Parrillo.
Plaintiff, Tatiana Cabrera-Renne, a Paterson police officer, appeals from two April 11, 2008 orders, denying her application to vacate a settlement agreement with defendants, the City of Paterson and the Paterson Police Department, and directing enforcement of the agreement. On appeal, plaintiff contends defendants violated a bilateral material term of the agreement that relieved her of her duty to perform, and entitled her to rescind the contract and reinstate her lawsuit against defendants. We disagree and affirm.
On January 25, 2008, plaintiff settled her lawsuit against defendants alleging violations of the Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -42. The agreement, which was placed on the record, provided that plaintiff would continue working as a Paterson police officer with all her duties, obligations, and benefits until she received a lump sum payment of $215,000 from defendants. Thereafter, the parties would abandon and release all pending actions against each other, plaintiff would voluntarily resign, and she would receive a neutral letter of recommendation regarding her position. Counsel agreed that all releases would be for "[a]s long as [plaintiff] remain[ed] [an] officer of the Paterson Police Department[;] it includes any claims up to [her] last day on the force." The settlement agreement was subject to City Council approval.
Plaintiff returned to her regular work assignment, but on February 8, 2008, defendants filed new disciplinary charges against her and suspended her without pay for thirty days for insubordination. By resolution of February 26, 2008, Paterson's governing body approved the settlement agreement.
On or about March 18, 2008, plaintiff filed an order to show cause seeking to vacate the settlement agreement and her voluntary dismissal of the underlying action. Plaintiff claimed that defendants had agreed not to bring new disciplinary charges against her after the settlement hearing, and argued they materially breached the agreement when they brought the disciplinary charges that led to her February 8 suspension. On March 20, 2008, defendants filed a motion to enforce the settlement agreement.
At oral argument on April 11, 2008, plaintiff sought to introduce information about the facts surrounding her alleged insubordination to show that defendants filed a false claim against her and, in essence, did not behave in compliance with the settlement agreement. The court declined to consider the substance of the charges, solely addressing the interpretation of the settlement agreement and concluding it did not protect plaintiff from having further charges filed against her for bad conduct after the date of settlement up to her resignation. The court noted that the validity of the charge could be pursued in an administrative proceeding if the parties chose to continue with it. The court held that defendants had not breached the settlement agreement, concluding it was "absolutely absurd" to think that, while waiting for the City Council to act, plaintiff could return to work, violate rules, and not be penalized with disciplinary action. Judge Graziano stated:
THE COURT: There will be no further actions by either party for anything that occurred up until that time. Clearly that's the import of this whole thing. It can't be that someone's going to settle a case and say I'm going to remain on the job until they have their Council meeting approving this and I can do whatever I want to do between now and then and I can't suffer any injury because of it. That makes no sense whatsoever.
THE COURT: You have to remain on the job until such time as the Council approves it. You behave. We'll behave. Everybody will be happy.
There's no guaranty that you can do whatever you want to do, violate any rules or regulations between now and the time you leave without penalty. That's absolutely absurd and makes no sense.
THE COURT: You're saying that a material term of the agreement is that she can do whatever she wants to do and that we're not going to bring any charges against her for it. That's -- that's ridiculous.
Defendants agreed that notwithstanding plaintiff's insubordination, they were willing to dismiss all disciplinary charges against her after the settlement agreement in exchange for a mutual release, and would reimburse her for any lost wages due to the thirty-day suspension. In response to plaintiff's further claim that she was damaged by having the February 8 suspension on her record,*fn1 defendants made another concession and agreed that in the event plaintiff sought other employment, they would not disclose her personnel file to another public entity unless ordered to do so. The court filed two orders on the same date memorializing its decision denying plaintiff's motion to vacate the settlement agreement and granting defendants' motion to enforce it.
Plaintiff appealed, renewing her argument that defendants' filing of the February 8, 2008 disciplinary action against her violated the terms of the settlement agreement. According to plaintiff, she agreed not to pursue her retaliation claim against defendants, and they agreed not to file any disciplinary actions against her, up to her last day of employment. She asserts the February 8 charge and sanction was a phony disciplinary action against her in retaliation for her LAD lawsuit and, as such, was a material breach of the agreement, causing her irreparable harm and entitling her as a matter of equity and law to set aside the agreement and reinstate her LAD complaint.
We discern no error by the trial court in enforcing the terms of the settlement agreement. A settlement of a legal claim is a contract like any other contract, Nolan v. Lee Ho, 120 N.J. 465, 472 (1990), which "may be freely entered into and which a court, absent a demonstration of 'fraud or other compelling circumstances,' should honor and enforce as it does other contracts." Pascarella v. Bruck, 190 N.J. Super. 118, 124-25 (App. Div.) (quoting Honeywell v. Bubb, 130 N.J. Super. 130, 136 (App. Div. 1974)), certif. denied, 94 N.J. 600 (1983). It does not matter whether the settlement agreement is oral, was never reduced to a writing, or was not placed on the record before a court. Lahue v. Pio Costa, 263 N.J. Super. 575, 596 (App. Div.), certif. denied, 134 N.J. 477 (1993); Pascarella, supra, 190 N.J. Super. at 124; Williams v. Vito, 365 N.J. Super. 225, 232-34 (Law Div. 2003). Because of our strong public policy of enforcing settlements, our courts "'strain to give effect to the terms of a settlement wherever possible.'" Brundage v. Estate of Carambio, 195 N.J. 575, 601 (2008) (quoting Dep't of Pub. Advocate v. N.J. Bd. of Pub. Utils., 206 N.J. Super. 523, 528 (App. Div. 1985)).
The judge's interpretation of the parties' settlement agreement was consistent with its plain meaning and public policy. The agreement contemplated that while plaintiff was working as a police officer with the City of Paterson, defendants would not pursue any grievances that were pending as of the date of settlement, but clearly did not mean that the public entity's hands were tied until plaintiff received her $215,000 payment and left her position with the police department. For plaintiff to believe that while waiting for the City Council to act, she could return to work, violate rules and act with impunity and not be penalized with disciplinary action, is, as Judge Graziano stated, "ridiculous." Considering plaintiff's position as a police officer, it would be further contrary to public policy to allow her to continue working without any oversight or review and to disregard departmental rules and regulations without consequences.
As defendants did not breach the terms of the agreement by filing the charges against plaintiff, and there is no evidence in the record of fraud by defendants, plaintiff was not entitled to the equitable remedy of rescission. Nolan, supra, 120 N.J. at 472. Accordingly, we have no reason to disturb Judge Graziano's ruling in this matter.