Southern Medical Corp. v. Liberty Mut. Ins. Co.

• Decision Date: 13 February 1995
• Docket Number: Nos. A94A2274,A94A2275,s. A94A2274
• Citation: 454 S.E.2d 180,216 Ga.App. 289
• Parties: SOUTHERN MEDICAL CORPORATION v. LIBERTY MUTUAL INSURANCE COMPANY. LIBERTY MUTUAL INSURANCE COMPANY v. SOUTHERN MEDICAL CORPORATION.
• Court: Georgia Court of Appeals

Page 180

454 S.E.2d 180

216 Ga.App. 289

SOUTHERN MEDICAL CORPORATION v. LIBERTY MUTUAL INSURANCE COMPANY.

LIBERTY MUTUAL INSURANCE COMPANY v. SOUTHERN MEDICAL CORPORATION.

Nos. A94A2274, A94A2275.

Court of Appeals of Georgia.

Feb. 13, 1995.

Newton, Smith, Durden, Kaufold & Rice, William R. Rice, Vidalia, Liggin & Winkler, H. James Winkler, Montezuma, for appellant.

Lamb & Associates, W.L. Henderson, Norcross, for appellee.

BIRDSONG, Presiding Judge.

We granted both parties' separate applications for interlocutory appeal to review the trial court's order denying both parties' cross-motions for summary judgment seeking to enforce a settlement agreement in an action to collect premiums for workers' compensation insurance. As the appeals arise from the same action below, the parties' appeals are consolidated for disposition. Both parties contend the case was settled by Southern Medical's agreement to consent to judgment, that the attorneys had authority to enter into the settlement agreement, and that the settlement agreement should be enforced.

The record shows that after Liberty Mutual sued Southern Medical to recover approximately $65,000 unpaid premiums for workers' compensation insurance on the hospital's employees, the case was placed on a trial calendar. Counsel for the parties then began settlement negotiations.

These negotiations culminated in a letter from Liberty Mutual's counsel that outlined the agreement between the parties. According to the letter, Southern Medical agreed to a consent judgment for the full amount sought in Liberty Mutual's suit in return for Liberty Mutual's agreement that the judgment would be entered when Southern Medical ceased operation. The relevant portions of the letter state as follows: "Please accept this letter as confirmation of our discussions ... regarding [this case]. After discussion and negotiation we determined that the best interest of our clients rested in administratively closing this action before Toombs County until such time as your client's last facility is closed. Upon the cessation of operations by your client you have agreed to enter into a consent judgment against the corporation in the entire amount sued upon." The terms of the agreement were announced later in open court and the case was removed from the trial calendar.

Subsequently, the particular attorney who negotiated the agreement left the firm representing Liberty Mutual and another attorney assumed responsibility for the case. The new attorney then requested that the case be placed on the calendar of a trial term. When Southern Medical moved to enforce the settlement agreement, Liberty Mutual also moved to enforce the settlement agreement contending that Southern Medical had ceased operations, and responded to Southern Medical's motion with a certificate of fact from the Office of the Secretary of State of Georgia that stated: "Southern Medical Corporation a domestic profit corporation was mailed a notice in accordance with Title 14 of the Official Code of Georgia Annotated and was involuntarily or administratively dissolved or revoked by the Office of the Secretary of State on [July 1, 1993] for failure to file its annual registration. This certificate is issued pursuant to Title 14 of the Official Code of Georgia Annotated and is prima-facie evidence of the existence or nonexistence of the facts stated herein." This certificate was filed on January 31, 1994. In response, Southern Medical, on the day of the hearing on the motions, filed an affidavit that stated that the affiant had "personal knowledge of the facts set forth herein. I am an officer of Southern Medical Corporation and I hereby confirm that Southern Medical Corporation continues in business and Southern Medical Corporation's last facility has not been closed." After the trial court denied both motions, these appeals followed. Held:

1. Although whether a settlement agreement is enforceable as a contract is a question of law for the court to decide (Gray v. Higgins, 205 Ga.App. 52, 53, 421 S.E.2d 341), the lower court elected to consider the enforceability of this agreement on cross-motions for summary judgment. Therefore, we will apply summary judgment law in deciding these appeals.

2. " 'Under Georgia law, an agreement alleged to be in settlement and compromise of a pending lawsuit must meet the same requisites of formation and enforceability as any other contract. In this regard, it is well settled that an agreement between two parties will occur only when the minds of the parties meet at the same time, upon the same subject matter, and in the same...