Simkin v. Blank, 2011 NY Slip Op 1 (N.Y. App. Div., 2011) received front page coverage in the New York Times on May 30, 2011 for Simkin’s brazen attempt to unravel his property settlement agreement based upon his post-divorce losses in the Bernard Madoff Ponzi scheme. Simkin should lose big time, and the New York Court of Appeals ought to leave the parties right where they are.
Simkin and Blank are a couple of wealthy New York City lawyers. When they divorced, Simkin gave Blank $2.7M cash from their $5.4M account in his name with Madoff Securities, and he kept the account. Blank waived spousal support and transferred their Scarsdale house to Simkin in exchange for her receiving their Manhattan apartment.
The only mention of equal division of anything is in the equalizing of retirement accounts. For the rest of the assets, the agreement just said who-got-what.
After divorce, Simkin learned the Madoff investment was not worth $2.7M; it was worth zero. Simkins sued Blank, claiming they made a mutual mistake about the value of the investment.
Dissenters P.J. Gonzalez and J. Moskowitz in the NY Supreme Court Appellate Division ruling get it exactly right; a deal is a deal:
If these parties had intended to divide the Madoff account 50-50, they would have said so. They do not mention Madoff’s name or that specific account anywhere in the agreement. [Seems to me this was a drafting error.]
Now Mr. Simkin, how can you allege that you and Blank made a mutual mistake about something that does not even exist by name within the four corners of your agreement?
You would not have shared the gain if the account had shot up in value, would you?
You are not offering to pay spousal support because the two of you have a lower combined net worth than anticipated, are you?
Get over it!