Mealer v. Kennedy

• Court: Georgia Court of Appeals
• Writing for the Court: Blackburn
• Citation: Mealer v. Kennedy, 659 S.E.2d 809, 290 Ga.App. 432 (Ga. App. 2008)
• Decision Date: 21 March 2008
• Docket Number: No. A08A0205.,A08A0205.
• Parties: MEALER v. KENNEDY.

290 Ga. App. 432

659 S.E.2d 809

290 Ga.App. 432

MEALER v. KENNEDY.

No. A08A0205.

Court of Appeals of Georgia.

March 21, 2008.

Downey & Cleveland, James T. Ponton and Joseph C. Parker, Marietta, for Appellant.

Lloyd Noland Bell, for Appellee.

BLACKBURN, Presiding Judge.

In a negligence case arising from a motor vehicle collision, we granted Beverly Mealer's application seeking interlocutory review of the denial of her motion to enforce a settlement agreement with Alex Kennedy. Because the trial court erred in concluding that Mealer and Kennedy had not reached a settlement agreement, we reverse.

"A trial court's order on a motion to enforce a settlement agreement based on undisputed facts is subject to de novo review." Anaya v. Coello.¹ The undisputed record shows that while Kennedy was riding his motorcycle on July 22, 2006, he was injured in a collision with a car driven by Mealer. On August 10, 2006, Mealer's insurance carrier, Progressive Insurance Company ("Progressive"), sent a letter to Kennedy's attorney at the time, offering the policy limits of $25,000 per person in exchange for either (1) a full and final release or (2) a limited liability agreement accompanied by a waiver of subrogation from any uninsured/underinsured motorist (UM) carriers. The offer was also inclusive of any hospital liens, known or unknown.

On September 19, 2006, Progressive was notified that Kennedy's attorney had been replaced by new counsel. The new counsel, rather than responding directly to Progressive's offer of its policy limits, of which he had knowledge, sent on October 4, 2006, a letter to Progressive "demanding the policy limits to settle this case for the sum of [$25,000], which Progressive has represented is the limit of their available insurance." The demand further provided that it expired on October 13, 2006, with no other terms being specified. The new attorney refused to communicate with Progressive except in writing. On October 5, 2006, Progressive responded in writing that it had previously offered to settle for the policy limits and attached the original August 10 letter memorializing the offer. Kennedy's attorney faxed a response the same day, stating, "I received [Progressive's] faxed letter of today's date accepting our demand for policy limits of $25,000. . . . As you are aware, the limited release is necessary to allow [Kennedy] to recover available underinsured motorist benefits." Thus, having received Progressive's letter, he attempted to couch the arrangement as Progressive having accepted his demand, rather than the plaintiff having accepted Progressive's offer which was on the table before this attorney was in the case. As shown by Kennedy's written offer, and as conceded by Kennedy's attorney at oral argument, Kennedy's attorney sought through the tactics discussed herein to put Progressive in an excess posture as to any verdict in excess of the policy limits.

On October 9, 2006, Progressive responded in writing, confirming that its "offer was inclusive of any liens," and requested Kennedy to execute an enclosed "Affidavit of No Lien" to confirm the representation that no liens existed. Progressive also requested contact information for Kennedy's UM carriers and an extension of time so that it could pursue a waiver of subrogation from the relevant UM carriers.

The next day, Progressive faxed Kennedy's attorney a copy of a proposed limited liability release agreement containing an indemnification in favor of Mealer and Progressive should either be sued in breach of the release agreement. That same day, Kennedy's attorney faxed a response to the October 9 letter, declining the time extension and stating that neither he nor his client had received notice of any lien or claim of lien.

On October 11, 2006, Progressive responded by facsimile, explaining that it had requested the UM carrier information so that Progressive "can request that each carrier agree to waive their subrogation rights. . . . For this reason, I again respectfully request that you grant an extension of your demand and identify all possible UM carriers." The letter further stated, "I have already provided you with a proposed Limited Liability Release and Affidavit of No Lien for your review." Separately, that same day, Progressive faxed and mailed to Kennedy's attorney a letter providing notice of its payment, with a check for $25,000 to the attorney's trust account. The letter stated that "it is understood that the enclosed Limited Liability Release form will be signed and . . . I also request [that] Mr. Kennedy execute the enclosed Affidavit of No Lien."

October 30, 2006, Kennedy's attorney sent Progressive a letter stating that due to Progressive's alleged failure to unconditionally accept his demand for the policy limits, the attorney believed that Progressive acted negligently and in bad faith; accordingly, the attorney enclosed a copy of a complaint which Kennedy had already filed against Mealer ten days earlier.

Mealer moved to enforce the settlement agreement it contended existed between the parties. After the trial court denied the motion and issued a certificate of immediate review, Mealer applied for interlocutory review, which this Court granted.

Compromises of doubtful rights are upheld by general policy, as tending to prevent litigation, in all enlightened systems of jurisprudence. In considering the enforceability of an alleged settlement agreement, however, a trial court is obviously limited to those terms upon which the parties themselves have mutually agreed. Absent such mutual agreement, there is no enforceable contract as between the parties. It is the duty of courts to construe and enforce contracts as made, and not to make them for the parties. The settlement agreement alleged to have been created in this case would have been the product of the attorneys for the parties. As the existence of a binding agreement is disputed, [Mealer,] the proponent of the settlement[,] must establish its existence in writing. The writing which will satisfy this requirement ideally consists of a formal written agreement signed by the parties. However, letters or documents prepared by attorneys which memorialize the terms of the agreement reached will suffice.

( Punctuation omitted.) Pourreza v. Teel Appraisals & Advisory.²

Here, Mealer points to the October 5 letter from Kennedy's attorney which notes his receipt of Progressive's "faxed letter of today's date accepting our demand for policy limits of $25,000." (Emphasis supplied.) In the October 5 letter, Kennedy's attorney also requested that the settlement be in the form of a limited release in light of Kennedy's intention to pursue UM claims. Nothing was inconsistent with Progressive's intended settlement or its subsequent correspondence.

In response, Kennedy contends that no agreement existed, arguing that "[t]o constitute a contract, the offer must be accepted unequivocally and without variance of any sort." (Punctuation omitted.) Herring v. Dunning.³ Kennedy asserts that (1) Progressive's subsequent request for execution of the No Lien Affidavit was an additional condition that rendered Progressive's response a counteroffer, (2) Progressive required Kennedy himself to obtain subrogation waivers from his UM carrier, and (3) an indemnity provision in the limited liability release form was objectionable and therefore at variance with his offer.⁴

At the outset, it is important to note that Kennedy's own attorney stated that Progressive's October 5 letter was an acceptance of "our demand for policy limits," which did not provide specific terms nor a specific manner of acceptance. Moreover, in that letter, Kennedy's attorney indicated his choice of a limited release — an option explicitly proposed by Progressive's letter. Thus, it is clear that Kennedy's attorney acknowledged acceptance of his nonspecific...