The Yankees appeared close to an agreement with reliever Octavio Dotel before talks cooled last night. But they still seem to hold a slight edge over the Mets, Indians, Rangers and Red Sox, with a deal expected as early as this afternoon, according to a person familiar with the negotiations.

General manager Brian Cashman, to no one's surprise, has identified the bullpen as the 2005 Yankees' most glaring weakness. He hopes to add Dotel as the latest in a series of offseason moves designed to bolster the relief corps.

The Yankees continued adding to their bullpen depth Tuesday, signing free-agent right-hander Octavio Dotel to a one-year, incentive-laden contract, FOXSports.com has learned.

Dotel, 32, is said to be ahead of schedule in his recovery from elbow-ligament transplant surgery, but might not be available until June.

He becomes the third free-agent reliever to join the Yankees, following right-hander Kyle Farnsworth and left-hander Mike Myers.

The Yankees earlier signed Farnsworth to a three-year, $17 million contract, envisioning him as the likely setup man for closer Mariano Rivera.

Dotel also could fill a setup role when healthy; he worked in that capacity with the Astros when Billy Wagner was the team's closer, and later closed for the Astros and A's.

Dotel chose the Yankees over the Mets, Indians and Cardinals, among other clubs.