Yaekle v. Andrews, 05CA1569.

• Decision Date: 23 February 2007
• Docket Number: No. 05CA1569.,05CA1569.
• Citation: 169 P.3d 196
• Parties: Fred R. YAEKLE, Plaintiff-Appellant, v. William R. ANDREWS and Creative Door Systems, Inc., a Colorado corporation, Defendants-Appellees.
• Court: Colorado Court of Appeals

169 P.3d 196

Fred R. YAEKLE, Plaintiff-Appellant, v. William R. ANDREWS and Creative Door Systems, Inc., a Colorado corporation, Defendants-Appellees.

No. 05CA1569.

Colorado Court of Appeals, Div. III.

February 23, 2007.

Rehearing Denied April 19, 2007.

Certiorari Granted October 9, 2007.

Bell & Pollock, P.C., Bradley P. Pollock, Greenwood Village, Colorado, for Plaintiff-Appellant.

Boyle Partnership, P.C., Terence P. Boyle, Denver, Colorado; Mark Apelman, P.C., Mark Apelman, Denver, Colorado, for Defendants-Appellees.

Opinion by Judge ROMÁN.

In this civil settlement dispute, plaintiff, Fred R. Yaekle, appeals a trial court order granting judicial enforcement of a settlement agreement and awarding attorney fees in favor of defendants, William R. Andrews and Creative Door Systems, Inc. We affirm in part, vacate in part, and remand for further proceedings.

Yaekle and Andrews were the sole owners and shareholders of their business, Creative Door Systems, Inc. After disputes arose between the owners, plaintiff sued defendants, and defendants filed counterclaims.

Before trial, the parties engaged in a mediation, after which they executed a one-page "Basic Terms of Settlement" on September 29, 2004.

The basic settlement provided for:

• defendants to make certain monetary payments to plaintiff on a specified schedule;

• a confession of judgment to be entered in the event of defendants' default;

• a mutual release in full "of all claims that could or did arise between the parties known or unknown" prior to September 29, 2004;

• a joint stipulation to dismiss upon defendants' final payment;

• the parties to pay their own costs • defendants to give plaintiff specific computer equipment;

• default interest of eighteen percent to start without notice on any unpaid balance if a payment were five days late; and

• plaintiff to sign any necessary documents to confirm the transfer of his interest in Creative Door to Andrews.

Above the signature lines was the following statement: "The parties understand this document is a binding enforceable agreement."

This case would be resolved except that the basic settlement also required "Formal Documents to be prepared by [defense counsel] within 14 days." Per the agreement, defense counsel sent a draft of the formal settlement document and mutual release to plaintiff and his counsel. The parties then disputed whether the terms of the prepared formal settlement agreement accurately reflected the terms of their basic settlement agreement.

On December 21, 2004, defendants forwarded a revised settlement agreement and mutual release containing language demanded by plaintiff. In January 2005, plaintiff filed a notice of pending settlement, in which he represented to the court that "[t]he parties finally reached an agreement concerning the acceptable content and terminology to be set forth in the settlement documents." Plaintiff further acknowledged that "[d]efendant[s] submitted a final Settlement Agreement and Mutual Release in or about the week of December 20, 2004," but that due to the holidays plaintiff did not receive it until after the first of the year and that plaintiff's counsel had yet to receive it.

Plaintiff sought, and the trial court granted, a continuance to file the settlement agreement. Thereafter, plaintiff filed four more requests for continuances. The trial court granted two of plaintiff's requests but denied the other two.

In April 2005, defendants filed a motion for judicial enforcement of the December revised settlement agreement. Plaintiff responded with a countermotion for judicial enforcement of the September basic settlement agreement. The trial court granted defendants' motion and determined that plaintiff and his counsel were jointly and severally liable for defendants' reasonable costs and attorney fees incurred after December 21, 2004.

I. Enforcement of a Settlement Agreement

Plaintiff contends the trial court erred by enforcing the December settlement agreement and mutual release. We disagree.

Colorado's Dispute Resolution Act, § 13-22-301, et seq., C.R.S.2006, sets out the requirements for a settlement agreement to be judicially enforceable. Section 13-22-308(1), C.R.S.2006, provides:

If the parties involved in a dispute reach a full or partial agreement, the agreement upon request of the parties shall be reduced to writing and approved by the parties and their attorneys, if any. If reduced to writing and signed by the parties, the agreement may be presented to the court by any party or their attorneys, if any, as a stipulation and, if approved by the court, shall be enforceable as an order of the court.

A. September Settlement Agreement

It is uncontested that the basic settlement agreement executed on September 29, 2004 met § 13-22-308(1)'s requirements, and therefore is an enforceable settlement agreement.

B. December Settlement Agreement

The issue of first impression before us is whether the revised settlement agreement drafted in December by defendants constitutes an enforceable settlement agreement, thereby replacing the September agreement, or whether the September basic agreement is the only agreement approved by the parties. We treat the issue as one of contract formation and agree with the trial court that the December agreement was enforceable.

Although the interpretation of a binding written contract is generally a question of law for the court, and thus subject to independent reevaluation by an appellate court, it is for the factfinder to determine whether the parties have entered into a contract in the first instance. More precisely, when the existence of a contract is at issue, and the evidence is conflicting or admits of more than one inference, the factfinder decides whether a contract in fact exists. I.M.A., Inc. v. Rocky Mountain Airways, Inc., 713 P.2d 882, 887 (Colo.1986); Compton v. Lemon Ranches, Ltd., 972 P.2d 1078, 1080 (Colo.App.1999)(the existence of a contract or any modification or amendment thereto is a question of fact to be determined by consideration of all the circumstances).

Appellate courts are bound by factual findings when competent evidence exists in the record to support such findings. I.M.A., Inc. v. Rocky Mountain Airways, Inc., supra. Unless the trial court's findings are clearly erroneous, they will not be reversed on appeal. Compton v. Lemon Ranches, Ltd., supra.

Here, the trial court enforced the December settlement agreement because it found that the parties approved its terms, stating:

• "Defendants sent the necessary documents to Plaintiff on October 1, 2004, and sent follow-up letters on October 11, 2004 and November 9, 2004";

• "Plaintiff's attorney only responded to the November 9, 2004 letter by objection to language in the mutual release provisions";

• "On November 22, 2004, Defendants provided authority for Plaintiff to modify the agreement to contain mirror-image provisions in the mutual release section"; and

• "On December 21, 2004, Defendants sent a revised settlement agreement with the mirror-image release language" demanded by plaintiff.

The record supports these findings except the trial court's finding that plaintiff's only objection to the November 9, 2004 letter related to the mutual release provision. The record shows that plaintiff also objected to the failure to include confession of judgment and default interest provisions. However, plaintiff's arguments regarding the confession of judgment and default interest provisions were rendered moot when defendants timely made the final payment.

More important, plaintiff's attorney never challenged, in his exchange of correspondence with defendants either before or after the December agreement, the formal settlement provisions regarding (1) confidentiality; (2) the effective date of the transfer of interest in Creative Door; or (3) attorney fees. Likewise, plaintiff did not rely on the lack of agreement on these terms — or on any terms — as support for his four motions for continuance.

Rather, plaintiff's attorney requested the various continuances because (1) it was "necessary to investigate the facts surrounding" new information; (2) the "parties [may] have to renegotiate, in one form or other, certain portions of the Stipulation" because criminal charges had been brought against plaintiff; (3) the district attorney had not been assigned to the criminal case; and (4) defendants needed to make their final payment before filing a joint stipulation to dismiss.

In its June 13, 2005 order, the trial court found that plaintiff's language "was incorporated in the Mutual [R]elease verbatim." The court further found that "Plaintiff did not contest the language in the December Agreement until this Court denied any further extensions of time to file said Agreement and granted Defendants' Motion to Enforce the December Agreement." The record supports the trial court's findings.

Because the trial court as the factfinder must determine whether a contract exists, has been modified, or has been amended based on consideration of all the circumstances, and the record supports the trial court's findings, we conclude the December settlement agreement constitutes an enforceable agreement. See I.M.A., Inc. v. Rocky Mountain Airways, Inc., supra; Compton v. Lemon Ranches, Ltd., supra; see also Scoular Co. v. Denney, 151 P.3d 615 (Colo.App.2006)(acceptance of a contract offer is defined as words or conduct that, when objectively viewed, manifests an intent to accept the offer; whether there has been acceptance is determined by an objective or reasonable person standard).

We further conclude the December settlement agreement meets § 13-22-308(1)'s requirements — a writing approved by the parties and their attorneys — to be judicially enforceable as a full settlement agreement. See also Nat'l Union Fire Ins. Co. v. Price, 78 P.3d 1138, 1141 (Colo.App. 2003)(§ 13-22-308(1) prevents an oral settlement agreement entered into during...