Humphreys v. Chrysler Motors Corp.

• Decision Date: 13 November 1990
• Docket Number: No. 19626,19626
• Citation: 184 W.Va. 30,399 S.E.2d 60
• Court: West Virginia Supreme Court
• Parties: Donald G. HUMPHREYS and Judy C. Humphreys v. CHRYSLER MOTORS CORPORATION; Capitol Chrysler-Plymouth-Yugo, Inc.; and Jamie Fuentes.

Page 60

399 S.E.2d 60

184 W.Va. 30

Donald G. HUMPHREYS and Judy C. Humphreys v. CHRYSLER MOTORS CORPORATION; Capitol

Chrysler-Plymouth-Yugo, Inc.; and Jamie Fuentes.

No. 19626.

Supreme Court of Appeals of West Virginia.

Nov. 13, 1990.

Syllabus by the Court

1. "The mere relation of attorney and client does not clothe the attorney with implied authority to compromise a claim of the client." Syllabus Point 5, Dwight v. Hazlett, 107 W.Va. 192, 147 S.E. 877 (1929).

2. "Where an attorney makes a compromise unauthorized by his client, and consents to a judgment thereon, the judgment may be vacated upon the application of the aggrieved client, seasonably made." Syllabus Point 6, Dwight v. Hazlett, 107 W.Va. 192, 147 S.E. 877 (1929).

Leo Catsonis, Charleston, for Donald G. Humphreys, Judy C. Humphreys.

David K. Schwirian, Pauley, Curry, Sturgeon & Vanderford, Charleston, for Chrysler Motors Corp.

PER CURIAM:

Donald G. and Judy C. Humphreys appeal the dismissal of the suit they instituted against Chrysler Motors Corporation, the successor in interest to Chrysler Corporation, Capitol Chrysler-Plymouth-Yugo, Inc., the successor in interest to Capitol Chrysler-Plymouth, Inc. and Jamie Fuentes (hereinafter collectively, Chrysler). The Circuit Court of Kanawha County determined that the suit should be dismissed because the parties had reached a compromise and settled the suit. Mr. and Mrs. Humphreys seek reinstatement of their suit maintaining that no settlement was reached because their lawyer lacked authority to compromise their claim. We find that no settlement was reached and, therefore, reverse the circuit court.

On September 29, 1987, Mr. and Mrs. Humphreys instituted a civil action against Chrysler alleging that the 1985 Chrysler Le Baron they purchased from Chrysler as a new vehicle was defective and had undergone substantial but incomplete repairs. Alleging fraud and concealment, Mr. and Mrs. Humphreys sought compensatory and punitive damages. ¹

In the Fall of 1988, Phil Stowers, Mr. and Mrs. Humphreys' lawyer, proposed a settlement to Mr. and Mrs. Humphreys, in which Chrysler would buy back the bank note still owed for the car. Mrs. Humphreys testified that at that time the outstanding principal was $6,800. ² Both Mr. and Mrs. Humphreys agreed to this settlement in part because they felt that paying that amount of money "might make them [Chrysler] think twice before they went ahead with something like this again." Chrysler rejected the offer.

When Mr. Stowers told Mr. and Mrs. Humphreys that the offer was rejected, Mrs. Humphreys said, "[G]ood, because my husband ... didn't want this settlement." No other settlement offers were discussed, and Mr. Stowers agreed to pursue the original suit. However, unknown to Mr. and Mrs. Humphreys, Mr. Stowers continued to seek a settlement. Mr. Stowers testified that he lacked his clients' authority to settle the case but thought he could persuade Mr. and Mrs. Humphreys to accept a settlement. ³

In December 1988, Mr. Stowers and Chrysler reached a settlement, in which Mr. and Mrs. Humphreys would discharge the suit and Chrysler would pay off the bank car note and would pay an additional $100 to Mr. and Mrs. Humphreys. ⁴ Mr. and Mrs. Humphreys rejected the settlement because they felt Chrysler was not adequately punished for fraud and they received no funds for their extended warranty claim.

On January 18, 1989, Chrysler filed a motion to dismiss and to compel Mr. and Mrs. Humphreys to sign a release. After a hearing on January 19, 1989, the circuit court ruled that a binding settlement had been made by Mr. Stowers, and, thereafter on July 12, 1989, appointed a commissioner to sign the release. On August 22, 1989, a dismissal order was entered. Mr. and Mrs. Humphreys appealed to this Court alleging they did not approve the settlement and did not give their lawyer the authority to approve the settlement.

I

In Syllabus Point 5, Dwight v. Hazlett, 107 W.Va. 192, 147 S.E. 877 (1929), we stated The mere relation of attorney and client does not clothe the attorney with implied authority to compromise a claim of the client.

See Fortuna v. Queen, 178 W.Va. 586, 589, 363S.E.2d 472, 475 (1987). The relationship of attorney and client does not imply that a power has been given to the attorney to compromise and settle a claim. In Syllabus Point 1, Kelly v. Belcher, 155 W.Va. 757, 187 S.E.2d 617 (1972), we said:

The well recognized general rule is that an attorney who is clothed with no other authority than that arising from his employment as attorney has no implied power by virtue of his general retainer to compromise and settle a claim or cause of action of his client.

The record in the present case indicates that in the Fall of 1988, Mr. and Mrs. Humphreys granted their lawyer authority to settle the case pursuant to the terms that they discussed. After Chrysler rejected the proposed settlement, Mr. and Mrs. Humphreys terminated their lawyer's authority to settle. The record indicates that Mr. and Mrs. Humphreys wanted to pursue their claim. Chrysler's argument that Mr. Stowers...