Palacios v. Vu
- Paul Engelmayer
- 1:20-cv-02985
- U.S. District Court · Southern District of New York
- 4
In Palacios v. Vu, Judge Paul A. Engelmayer prepared to review a wrongful-death settlement and ordered defendants to address whether the court could approve it.
The estate of Matthew Travis Palacios, represented by Yolanda Nieves, and the defendants, including Luc Vu, because the order set the next steps for determining whether the federal court could review and approve their proposed settlement.
What happened
Palacios v. Vu is a wrongful-death and negligence case that the defendants removed from New York State Court. After the parties reached a settlement through private mediation, they asked the federal court to approve it instead of the New York Surrogate’s Court.
The parties disagreed about whether Surrogate’s Court approval was required under the limited administration papers issued to Yolanda Nieves. The federal court had previously directed the parties to seek approval from Surrogate’s Court because it was uncertain whether the federal court had authority to approve the settlement. After little progress there, the plaintiff cited decisions stating that a court handling a wrongful-death case may have concurrent authority to approve the settlement.
Judge Paul A. Engelmayer found those authorities persuasive and stated that the federal court was prepared to review whether the settlement was fair and adequate. He ordered the defendants to submit a letter by June 10, 2022, supporting their position that the federal court could not approve the settlement or conceding that it could, and ordered the parties to submit the proposed settlement for review.
The detailed version
- Palacios v. Vu · No. 1:20-cv-02985
- Paul A. Engelmayer
- June 3, 2022
Background
This wrongful-death and negligence action was removed from New York State Court. On January 4, 2021, the parties told the court that they had resolved the case through private mediation and asked the federal court to approve the settlement instead of obtaining approval from the New York Surrogate’s Court. New York law requires court approval of a wrongful-death settlement after review of the case’s merits, the proposed damages, attorneys’ fees, and other expenses.
The court initially was unable to determine whether its approval would eliminate the need for approval by Surrogate’s Court. It therefore directed the parties to report whether that approval had been obtained. The parties reported that it had not. The court then instructed them to seek authorization from Surrogate’s Court and to provide periodic joint status reports.
Dispute about approval authority
The defendants argued that Surrogate’s Court approval was required because the limited letters of administration stated that collection above zero dollars required a further order from Surrogate’s Court. The plaintiff argued that the letters also authorized approval by a court with jurisdiction over the case under New York Estates, Powers and Trusts Law § 5-4.6.
After the parties made repeated status filings and little progress appeared to have been made in Surrogate’s Court, the plaintiff cited decisions stating that a federal district court handling a wrongful-death action may have concurrent authority to approve the settlement. The cited authorities addressed the federal court’s ability to review the settlement’s adequacy and authorize distribution of the recovery.
Court’s action
Judge Paul A. Engelmayer found the plaintiff’s authorities persuasive and stated that, consistently with practices of other courts in the district, the federal court was prepared to review the proposed settlement for fairness and adequacy. The court did not approve the settlement in this order.
The court instructed the defendants to respond to the plaintiff’s letter in no more than three single-spaced pages by the end of June 10, 2022. The response was to cite authority supporting the defendants’ position that the federal court could not approve the settlement, if any, or concede that the federal court could do so. The court also ordered the parties to submit the proposed settlement by that deadline so it could promptly review it if the defendants’ response did not persuade the court.
Disposition
The order required further submissions and did not itself approve or reject the proposed settlement.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.