US v. Dantzler Lumber & Export Co.
| Decision Date | 29 September 1993 |
| Docket Number | Court No. 90-11-00600. |
| Citation | 833 F. Supp. 927 |
| Parties | UNITED STATES of America, Plaintiff, v. DANTZLER LUMBER & EXPORT COMPANY, a Florida corporation (a/k/a Dantzler Lumber & Export Company, Inc. a/k/a Dantzler Lumber and Export Company a/k/a Dantzler Lumber & Export Co. a/k/a Dantzler Lumber & Export Inc. a/k/a Dantzler Building Specialties, Inc. a/k/a Dantzler Building Specialties Div., Inc.), and Antonio D. Godinez, Defendants. |
| Court | U.S. Court of International Trade |
Frank W. Hunger, Asst. Atty. Gen.; David M. Cohen, Director, Commercial Litigation Branch, U.S. Dept. of Justice, Civ. Div., Patricia L. Petty, Washington, DC, for plaintiff.
Fotopulos, Spridgeon & Perez, P.A., Thomas E. Fotopulos, Tampa, FL, for defendants.
The background of this case brought by the government pursuant to 19 U.S.C. § 1592 and 28 U.S.C. § 1582 is set forth in slip opinions of the court numbered 92-222, 16 CIT ___, 810 F.Supp. 1277 (1992); 93-36, 17 CIT ___, 1993 WL 79496 (March 15, 1993); and 93-120, 17 CIT ___, 1993 WL 248619 (June 25, 1993), familiarity with which is presumed. The latest of those decisions stated that the chief judge had ordered trial of the case to commence on July 8, 1993 in the U.S. district courthouse in Tampa, Florida. On July 7th, the attorneys for both sides notified the court that they had reached agreement on settlement of the issues remaining for trial1, whereupon they were directed by order dated July 8, 1993 to present a proposed final judgment disposing of this case in its entirety on or before July 30th.
That deadline was adopted to afford the plaintiff government ample time to approve the settlement negotiated by its lawyers from the Department of Justice and the regional office of the Customs Service. The plaintiff did not meet the deadline, causing its counsel (1) to file a motion on July 30th for an extension of time upon a representation that the agency had not yet forwarded its recommendations regarding the proposed settlement and (2) to thereafter file a report on September 3, 1993 stating, among other things, that on August 31st "the Government rejected the proposed settlement offer submitted by the defendants." Since that report also indicated that counsel had first been contacted by their client on August 24th, recommending that the settlement offer not be accepted, a hearing was ordered held in open court on September 23, 1993 to afford Customs an opportunity to prove that it had not been delinquent.2 It did not do so.
At the hearing, the plaintiff presented argument and offered ten documentary exhibits, the first of which is a written declaration of Richard S. Friedland, the Senior Attorney in the Office of the Regional Counsel for the Southeast Customs Region, who has appeared "of counsel ... and been fully aware and involved in the developments pertaining to this case." Exhibit 1, para. 8. As his title indicates, Mr. Friedland's declaration confirms that he has had "significant experience"3 in matters of this kind and also that he was privy to the settlement discussions and that the court was indeed informed on July 7th that plaintiff's trial attorney and he "would recommend the settlement offer"4 to their respective superiors. At the hearing, which Mr. Friedland did not attend, and in his declarations5, counsel are pained to prove that they neither overstepped their authority nor led the court to believe otherwise.
The court concurs, and so stated at the hearing. But the court also therefore stated that the concern is not the conduct of the lawyers, rather of their clients, in this instance primarily the Customs Service. An attorney in the office of its chief counsel in Washington, D.C., which is where the settlement apparently foundered, attended the hearing, but, when offered an opportunity by the court to be heard, he declined. The plaintiff thus rests on the legal arguments presented and on the exhibits submitted, the second of which is nothing more than a copy of that part of Chapter I of 28 C.F.R. which sets forth the regulations governing settlement of cases by government attorneys. The remainder of the exhibits are copies of correspondence dating from September 28, 1992 and memorializing discussions between opposing counsel covering settlement, among other topics. Exhibit 7, for example, a letter from the Justice Department to defendants' attorney dated July 23, 1993, warned him on the one hand of the impending deadline and yet sought at that late moment to change the terms of the agreement on the other, to wit:
Suffice it to conclude that this and the other copies of correspondence offered do not justify plaintiff's noncompliance with the court's order of July 8, 1993. The entries underlying this case occurred years ago. They gave rise to a criminal indictment in district court, a trial thereon and appeal therefrom. That process led to this one and, seemingly, to settlement discussions a year ago, if not longer, among able and experienced lawyers. The problem is not that their agreement has not been approved; rather the plaintiff, which has and has had the burden of proceeding, having inconvenienced this and the district court in Tampa in July, in failing to provide timely notice of its approval or disapproval as ordered, has engendered additional delay and inconvenience6 in this case of its own creation.
In conjunction with the hearing, on their part the defendants have filed a Motion to Enforce Settlement Agreement, which outlines the negotiations commencing on September 24, 1992 and which represents, among other things, that the terms to which they ultimately agreed were those "solicited" by the government and that, if "the settlement agreement reached between the parties on July 7, 1993 is not enforced, the Defendants will suffer extreme prejudice." The motion concludes:
14. The Defendants negotiated the settlement agreement in good faith, with counsel of record for the Plaintiff, who conducted all settlement negotiations on behalf of her client, and who had the apparent authority to reject two prior offers in compromise. The Defendants are ready, willing, and able to consummate and perform the agreement.
A
This may be. Indeed, the defendants have disclosed in the motion the terms and conditions which they accepted. They pray for specific performance thereof. To this end, the motion cites United States v. Beebe, 180 U.S. 343, 21 S.Ct. 371, 45 L.Ed. 563 (1901); Amin v. Merit Systems Protection Board, 951 F.2d 1247 (Fed.Cir.1991); Matzo v. Postmaster General, 685 F.Supp. 260 (D.D.C. 1987); Capital Dredge & Dock Corp. v. City of Detroit, 800 F.2d 525 (6th Cir.1986); Wong v. Bailey, 752 F.2d 619 (11th Cir.1985); Read v. Baker, 438 F.Supp. 732 (D.Del.1977); Walden v. Sanger, 250 S.W.2d 312 (Tex.Civ.App. 1952), and 30 A.L.R.2d 953, § 10.
These cases do indeed stand for the proposition that the court can enforce a settlement agreement, as a rebuttable presumption exists that an attorney of record who agrees to a compromise has authority to do so. E.g., Amin v. Merit Systems Protection Board, 951 F.2d at 1254, finding that the plaintiff failed to present sufficient evidence that his attorney did not have authority to settle a removal action with the Board; Walden v. Sanger, 250 S.W.2d at 316, holding that no abuse of discretion existed when the court overruled a motion for a new trial after the attorney of record for the plaintiff signed a compromise agreement, requested the court's approval and failed to raise any question as to authority to sign the agreement until after judgment had been entered; Wong v. Bailey, 752 F.2d at 621, upholding a district court judgment to enforce a settlement agreement to which the plaintiff's trial attorney initially agreed orally, objecting later during finalization to the inclusion of a general release clause; Read v. Baker, 438 F.Supp. at 735, finding that an attorney is presumed to have authority upon agreement to the compromise and that the court had inherent power to enforce a settlement entered into by the parties before it. Moreover, Matzo v. Postmaster General, supra, held that an attorney may acquire that authority by implication "from the totality of the attorney-client relationship". Finally, in Capital Dredge & Dock Corp. v. City of Detroit, supra, the court held that an attorney may possess "apparent authority" to settle claims. In that case, the plaintiff held out his attorney as having authority to represent him in personal-injury and other related claims. The court therefore found that the defendant could reasonably believe that authority existed to settle extra work and delay claims, which were also pending.
None of these cases support the motion herein, however, that the settlement be enforced against the government. First, even if the...
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