HACKETT v. HACKETT (Appellate Division, 2nd Dep’t)

The parties executed a written settlement agreement in January 2006 whereby the defendant-wife was awarded the marital residence valued at $465,000 and assumed the remaining $195,000 mortgage on the property. The wife also waived any claims she would have on the husband’s enhanced earnings from his CPA license. The plaintiff-husband was awarded ownership of his restaurant business valued between $360,000 and $385,000, however for settlement purposes, the parties agreed its value was $325,000. Finally, to equalize the division of the assets, husband paid wife $19,336.

In January 2008, the husband commenced action to reform the settlement alleging mutual mistake and that the unequal division of the marital assets pursuant to the settlement agreement resulted in the undervaluing the wife’s assets and an additional $100,277 was due the husband for that error. The Appellate Court found for the defendant-wife: although she was awarded title to the marital residence, in exchange, she relinquished any claims to the plaintiff’s business, his enhanced earnings, and any spousal maintenance. The wife’s intent in agreeing to the 2006 settlement agreement would not have occurred had she known that she would have to pay an additional $100,277 and that she knowingly made certain concessions during settlement (as noted above). Because, the plaintiff-husband failed to show “clearly and beyond doubt” that the settlement agreement was the result of mutual, rather than a unilateral mistake his request was denied.