Sockolof v. Eden Point North Condominium Ass'n, Inc., 81-2311

• Decision Date: 09 November 1982
• Docket Number: No. 81-2311,81-2311
• Citation: 421 So.2d 716
• Parties: Frank J. SOCKOLOF and Sally Sockolof, Appellants, v. EDEN POINT NORTH CONDOMINIUM ASSOCIATION, INC., Appellee.
• Court: Florida District Court of Appeals

Page 716

421 So.2d 716

Frank J. SOCKOLOF and Sally Sockolof, Appellants, v. EDEN POINT NORTH CONDOMINIUM ASSOCIATION, INC., Appellee.

No. 81-2311.

District Court of Appeal of Florida,

Third District.

Nov. 9, 1982.

Becker, Poliakoff & Streitfeld and Robert J. Manne, Fort Lauderdale, for appellants.

Leff, Pesetsky & Zack and Elliott Zack and Steven R. Dobrofsky, North Miami Beach, for appellee.

Before NESBITT, BASKIN and DANIEL S. PEARSON, JJ.

DANIEL S. PEARSON, Judge.

The only issues in this case which merit discussion are whether the appellants' attorney was authorized to settle the case on behalf of his clients and, if so, whether the oral settlement agreement between counsel for the parties was entitled to be enforced by the trial court. ¹

The Sockolofs, unit owners in the Eden Point North Condominium, were sued by the condominium association when they failed to pay an assessment for improvements to common grounds of the condominium. A non-jury trial of the action was scheduled to begin on August 10, 1981. On July 27, 1981, the Sockolofs' attorney moved for a continuance, alleging that his clients "have been called away out-of-town for urgent business matters during that trial week and it will prejudice Defendants' case to proceed with the trial without their presence." The defendants served notice that their motion would be heard on August 10, 1981, the very day trial was to begin.

On August 10, 1981, the trial judge denied the requested continuance, but partially accommodated the request by specially setting the trial to begin on Friday of that week, August 14, 1981, at 1:30 p.m. On the evening of August 13, 1981, counsel for the parties orally entered into an agreement settling the case and cancelling the next day's trial. Two weeks later the plaintiff-association moved to enforce the settlement, Sockolofs' counsel moved to withdraw, and Sockolofs' present counsel moved to appear in the case on their behalf. In that sequence, the trial court granted the respective motions and thereafter denied Sockolofs' substituted counsel's ore tenus motion for rehearing. The Sockolofs appeal, and we affirm.

The appellants first contend that the trial court's failure to allow counsel to be substituted denied them due process under circumstances where existing counsel, who had entered into the settlement agreement, was not in a position to advocate his clients' claim that the agreement could not be enforced. While we agree that given this apparent conflict, the motions to withdraw and substitute should have been granted before the trial court embarked on the motion to enforce settlement, we do not agree that the Sockolofs were denied due process. The record reflects that the sole contention which the Sockolofs' new counsel made in his ore tenus motion for rehearing was that the agreement could not be enforced because not in writing. Since we here decide against that contention, the failure of the trial court to allow Sockolofs' new counsel to advance it at an earlier stage is, of course, harmless.

At common law, no particular form of settlement agreement was essential to its validity; a writing was unnecessary, unless required by statute, National Surety Co. v. Willys-Overland, Inc., 103 Fla. 738, 138 So. 24 (1931). The appellants concede that Florida Rule of Judicial Administration 2.060(g), which requires that procedural stipulations during the course of litigation be written or recorded, expressly does not apply to "settlements or other substantive agreements." They correctly argue that therefore case law controls, but incorrectly rely upon cases decided under former Florida Rule of Civil Procedure 1.030(d), which during its existence was construed to require that substantive settlements be in writing. See, e.g., Davies v. Canco Enterprises, 350 So.2d 23 (Fla. 3d DCA 1977); Alaimo v. Tirone, 297 So.2d 584 (Fla. 3d DCA 1974). Rule 1.030(d) was repealed effective July 1, 1979, and the settlement agreement here was entered into August 13, 1981. Thus, the common law rule set forth in National Surety Co. v. Willys-Overland, Inc. applies, and the settlement agreement, although not in writing, was enforceable.

The appellants' challenge to the authority of their attorney to enter into the settlement agreement, while not contained in their ore tenus motion for rehearing, was sufficiently preserved for review when their original trial counsel, explaining how the settlement came about, noted that his clients subsequently questioned his authority to make the settlement.

The record is undisputed that the attorney for the Sockolofs entered into the settlement agreement under the following circumstances "MR. WOHL: Your Honor, let me backtrack a second to give you a chronology of events.

"I filed my motion to continue the trial. I came here on calendar call and made a statement to your Honor that my clients were out of town, that it was very difficult for me to get in touch with them, and your Honor denied my motion.

"I then spent a number of hours trying to locate Mr. Sockolof who was, unbeknownst to me, in Canada on matters concerning his health. I told him the set of circumstances. I told him that I was not getting any cooperation from the other defendants in the case. That is Mr. and Mrs. Sachs, who I will get to in a second, and Mrs. Grossberg and Andrews.

"And he said to me, 'Do the best that you can under the circumstances.'

"Since I did not effectively have a client to attend the trial, I presumed, under those circumstances, since the other side was ready to go, that, in fact, I was going to lose the case. And I, since this matter is something that should be, under Florida statute on attorney's fees, taxed, and court costs, I agreed to try to mitigate the damages in question.

"Whether I had specific authority to enter into this monetary agreement or not, I entered into this agreement.

....

"Mr. Sockolof finally came back. He was unable to come back because he was, I believe, in a clinic in Canada for the trial.

....

"Under the circumstances, your Honor, after speaking to Mr. Sockolof and reviewing with him the stipulation, he stated to me that I did not have authority to agree to not only the enforcement portion but also the monetary portion of the stipulation. And I said, under those circumstances, that I had a conflict of interest and I had to withdraw as counsel and I asked them to seek counsel and gave him the entirety of my file to seek other counsel who has a pending motion here for substitution."

The appellants filed no pleading or affidavit below and made no proffer of evidence challenging the accuracy of their attorney's account of the events. Indeed, on appeal they make no such challenge and instead assert that their attorney misconstrued the meaning of "Do the best you can under the circumstances." There is, then, no dispute as to what occurred between the attorney and the client which required resolution. Compare American Life Insurance Co. v. Laucirica, 217 So.2d 869 (Fla. 3d DCA 1969) (where attorney's authority to settle is a question of conflicting and disputed fact, court not authorized to summarily enter judgment on purported settlement agreement); Massachusetts Casualty Insurance Co. v. Forman, 469 F.2d 259 (5th Cir.1972); Pearson v. Ecological Science Corp., 522 F.2d 171 (5th Cir.1975); Calhoun v. Cook, 487 F.2d 680 (5th Cir.1973) (evidentiary hearing required where material facts concerning authority to settle or existence of agreement in dispute).

It is well established that the mere employment of an attorney to represent a client with respect to litigation or other matters does not of itself give the attorney the implied or apparent authority to compromise or settle his client's cause of action. Cross-Aero Corp. v. Cross-Aero Service Corp., 326 So.2d 249, 250 (Fla. 3d DCA 1976); Palm Beach Royal Hotel, Inc. v. Breese, 154 So.2d 698 (Fla. 2d DCA 1963). We think, however, that the present case falls within an exception to this general rule. This exception, recognized, although not applied, in Bursten v. Green, 172 So.2d 472 (Fla. 2d DCA 1965), is set forth in Brumberg v. Chunghai Chan, 25 Misc.2d 312, 204 N.Y.S.2d 315 (1959), cited with approval in Bursten v. Green, supra. "[W]here the circumstances are such that the attorney is obliged to act without delay, and there is not time or opportunity for consultation with the client, the attorney has power to compromise his client's claim." 204 N.Y.S.2d at 319. In the Brumberg case, Chan, the client, was served with process in a landlord-tenant action and notified his attorney, Brumberg. Chan then went to Hong Kong on personal business. The case was scheduled for trial after two adjournments. Chan had still not returned to the United States, and his attorney was unable to contact him. The attorney, believing that a trial would result in a final dispossess order being entered against his client, entered into a settlement under which the landlord would waive certain rental payments and Chan would drop his counterclaim against the landlord. The court found that under these circumstances, the attorney was empowered to compromise his client's claim.

The appellants' attorney faced a situation not unlike that faced by Mr. Brumberg. Trial was to be the following day, and the Sockolofs were, in his judgment, faced with certain loss, including attorneys' fees and costs. The settlement reached excluded such fees and costs. While it is true that the Sockolofs' attorney had the opportunity to, and in fact did, consult with his client, that consultation resulted in the words "Do the best you can under the circumstances." But these are the very words which are implicit where an emergency exists and no consultation occurs.

We think, then, that the attorney's power to compromise in the emergency situation turns on the attorney's obligation to act without delay...