MAINE SUPREME JUDICIAL COURT Reporter of Decisions
Decision: 2014 ME 105
Docket: Cum-13-560
Argued: June 10, 2014
Decided: August 14, 2014
Panel: SAUFLEY, C.J., and ALEXANDER, SILVER, MEAD, GORMAN, and JABAR, JJ.
ESTATE OF HAROLD FOREST SNOW
SILVER, J.
[¶1] Susan R. Snow appeals from a judgment of the Cumberland County
Probate Court (Mazziotti, J.) granting a motion filed by the personal representative
of the estate of Susan’s father, Harold Forest Snow, to enforce a settlement
agreement between the parties. Susan contends, inter alia, that the court erred or
abused its discretion in (1) concluding that a binding settlement agreement existed
between the parties and (2) granting the personal representative’s motion without
holding a trial or evidentiary hearing or requiring the parties to submit summary
judgment filings. This case gives us the opportunity to analyze when a settlement
has been reached and, if so, how to enforce the settlement agreement. We affirm
the judgment.
I. BACKGROUND
[¶2] The parties do not dispute the following facts. Harold Forest Snow
died on November 29, 2011, survived by four adult daughters. On
December 13, 2011, Linda C. Moulton, one of Harold’s daughters, applied for
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informal probate of a will dated February 20, 1997, and a holographic codicil to
the will dated October 19, 2011, and for appointment as personal representative of
Harold’s estate. The will provides that the residuary of Harold’s estate is to be
divided equally among his four daughters, and nominates Linda as personal
representative. In the event that Linda does not serve, the will nominates Susan R.
Snow as personal representative. The codicil provides:
I Harold Snow intend This to be part of my will. I intend that
The gifts made to my daughter Susan of the camp and land in
Standish on Sebago lake, and of The land known as the pasture behind
my home on Pine Point Road be considered as advance distribution as
part of my estate as stated in my will
Harold F. Snow
Oct 19 2011
These gifts are to be valued as of the date They were Transferred to
Susan
Harold F. Snow
On December 16, 2011, the Register of Probate issued letters of authority to Linda
and informally admitted the will and codicil to probate.
[¶3] On March 20, 2012, Linda, as personal representative, filed a civil
action against Susan in the Probate Court pursuant to 18-A M.R.S. §§ 1-302, 3-105
(2013) alleging that one of the transfers identified in the codicil was an
improvident transfer pursuant to 33 M.R.S. §§ 1021-1025 (2013) and a product of
undue influence pursuant to the common law. Linda also sought an injunction
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requiring Susan to convey the property to Harold’s estate and prohibiting Susan
from transferring the property to a third party. On October 19, 2012, Linda
petitioned for formal probate of the will and codicil.
[¶4] The parties engaged in discovery. On July 18, 2013, Susan filed a
letter with the court alleging that Linda had, by “means outside of the discovery
rules,” obtained confidential information contained on computer discs and a hard
drive found in Harold’s home. Susan sought the immediate return of the discs and
hard drive. On July 25, 2013, after a conference, the court ordered, inter alia, that
Linda return the original discs and hard drive to Susan’s attorney, that the parties’
attorneys preserve and keep confidential copies of the information on the discs, and
that Susan’s attorney preserve the hard drive and provide Linda’s attorney with a
list of the contents of the drive so that Linda could request information pursuant to
the discovery rules.
[¶5] On July 30, 2013, Susan appeared for her deposition at the office of
Linda’s attorney. Before Susan was deposed, she authorized her attorney to
negotiate a settlement with Linda’s attorneys. Ultimately, Susan’s and Linda’s
attorneys went on the record before the attending professional reporter, stating: “So
we are on the record here. We have settled the case. We are going to try to put
down the outlines of the settlement, and then [we] are going to work on finalizing
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it.” The attorneys then discussed the details of the settlement on the record. Susan
left without being deposed.
[¶6] The terms were placed on the record on July 30, 2013, as follows:
• Terry Snow would serve as personal representative.
• Before resigning as personal representative, Linda would file an estate tax
return, and would be permitted to make partial distributions to herself and to
her sisters Cora Jean and Beverly, and could pay expenses, but could not sell
estate assets.
• Susan would decline to serve as personal representative.
• The parties would exchange global releases of all claims relating to the
estate or to Linda’s acquisition of Susan’s discs and hard drive. The releases
would include the parties’ law firms.
• Linda’s law firm would destroy all copies of the information on the discs
that were the subject of the discovery dispute, and Susan’s law firm would
preserve the original discs in perpetuity.
• Susan would sign a letter to be sent to the Scarborough Police Department
retracting a criminal complaint she had filed regarding Linda’s acquisition of
the discs and hard drive, explaining that it had been a misunderstanding and
that everything had been returned to her.
• The estate would not pay Susan’s attorney fees, and Susan would waive any
right to an accounting with respect to Linda’s service as personal
representative.
• The holographic codicil to Harold’s will would be valid and enforceable,
and the property described in the codicil would be valued at $400,000. If
Susan’s full one-quarter share of the residuary estate was more than
$400,000, she would receive an additional distribution to cover the
difference.
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• The parties would stipulate to dismissal with prejudice of the civil action
against Susan.
• The parties would execute any documents necessary to effectuate the
settlement.
[¶7] For about the next two weeks the attorneys sent proposed language
back and forth to each other. Neither side would agree to sign the other’s proposed
settlement documents nor would either accept the other side’s proposed letters to
the Scarborough Police Department.
[¶8] Linda filed a motion to enforce the settlement agreement and to amend
her civil complaint to add a claim for breach of the agreement.1 Susan opposed the
motion to enforce but agreed that Linda should be allowed to amend her complaint.
Both parties attached to their filings the transcript of the conference on
July 30, 2013; the various draft agreements exchanged by the parties, along with
the related email correspondence; and affidavits of counsel authenticating the
documents. Neither party requested a hearing on the motion.
[¶9] On October 28, 2013, the Probate Court granted Linda’s motion to
enforce, finding that the record “contains an unequivocal stipulation by the parties’
attorneys that the matter was settled” and that the material terms of the agreement
were clearly defined in the transcript. The court further found that Linda’s
1
Shortly thereafter, Susan filed a complaint against Linda in the Superior Court, alleging tortious
interference with an expected inheritance, intentional infliction of emotional distress, and undue
influence, and seeking an accounting. Proceedings on that complaint have been stayed pending the final
disposition of the motion to enforce in the Probate Court.
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proposed letter to the Scarborough Police Department and final written agreement
accurately memorialized the material terms of the settlement; the court
incorporated those documents by reference in the judgment, ordered that Susan
sign the letter, and ordered that the written agreement be enforced. The court
granted Linda’s petition for formal probate of the will and appointment as personal
representative, dismissed with prejudice the civil action against Susan, and denied
as moot Linda’s motion to amend her civil complaint.
[¶10] Susan subsequently filed a motion for findings of fact and conclusions
of law. Specifically, Susan requested “that the Court make findings of fact citing
to evidence in the record regarding the existence and the terms of a purported
settlement agreement found by the court, including a finding as to whether such
terms are ambiguous or unambiguous,” “the form in which the purported
settlement agreement exists,” “the time when the purported settlement agreement
was formed,” and “the precise parties to the purported settlement agreement.” The
court denied the motion, concluding that “the Order and the portions of the record
incorporated therein by reference provide adequate findings of fact and
conclusions of law regarding the issues identified within [Susan’s] motion.”
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II. DISCUSSION
A. Contract Analysis
[¶11] “Settlement agreements are analyzed as contracts, and the existence of
a binding settlement is a question of fact.” Muther v. Broad Cove Shore Ass’n,
2009 ME 37, ¶ 6, 968 A.2d 539; see also McClare v. Rocha, 2014 ME 4, ¶ 16,
86 A.3d 22 (“Whether a contract exists . . . [is a] question[] of fact.”). “In order to
be binding, a settlement agreement requires the mutual intent of the parties to be
bound by terms sufficiently definite to enforce.” Muther, 2009 ME 37, ¶ 6,
968 A.2d 539; see also McClare, 2014 ME 4, ¶ 16, 86 A.3d 22 (“A contract exists
when the parties mutually assent to be bound by all its material terms, the assent is
either expressly or impliedly manifested in the contract, and the contract is
sufficiently definite.” (quotation marks omitted)). We will vacate a trial court’s
determination that parties intended to be bound by an agreement only if it is clearly
erroneous, meaning that there is no competent evidence in the record to support
that determination. White v. Fleet Bank of Me., 2005 ME 72, ¶ 11, 875 A.2d 680.
The existence of contrary evidence does not render a court’s findings clearly
erroneous. See id. ¶ 13.
[¶12] “We have recognized a distinction between a preliminary agreement
to agree and a binding settlement agreement.” Muther, 2009 ME 37, ¶ 6,
968 A.2d 539 (quotation marks omitted). “Preliminary negotiations as to the terms
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of a future agreement do not constitute a contract.” McClare, 2014 ME 4, ¶ 20,
86 A.3d 22. “Whether the parties are merely negotiating the contract, or entering
into a present contract, is purely a question of intention.” Id. (quotation marks
omitted). “The absence of a formalized contract does not affect the binding nature
of a potential contract if the parties intended to close the contract prior to a formal
writing.” Id.
The intention of the parties should be gathered from the
language of any agreement, viewed in the light of the circumstances
under which it was made, including the use of the words “offer” and
“acceptance.” Other relevant circumstances include the extent to
which an express agreement has been reached on all terms to be
included; whether the contract is of a type that is usually put in
writing; whether it needs a formal writing for its full expression;
whether it is a common or unusual contract; whether a standard form
of contract is widely used in similar transactions; and whether either
party takes any action in preparation for performance.
Id. ¶ 21 (citations and quotation marks omitted).
[¶13] The record before the Probate Court contained ample evidence that
the parties intended to enter into an enforceable settlement agreement to be
subsequently memorialized in writing, that the parties did in fact assent to the
terms set forth on the record before the court reporter, and that the terms placed on
the record reflected all of the material terms of the contract. Counsel began their
conference that day with the statement, “We have settled the case.” Counsel then
enumerated various terms on which the parties had “agreed.” Susan’s deposition
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did not proceed as scheduled, reflecting the understanding that the case had been
resolved.
[¶14] As Susan points out, there is language in the transcript and the
subsequent email correspondence indicating that the conference on the record on
the day of Susan’s deposition was merely an “outline,” and that certain details of
the agreement remained to be negotiated. The mere existence of some evidence
that would support a finding contrary to the court’s decision, however, does not
render the decision clearly erroneous. See White, 2005 ME 72, ¶¶ 11, 13,
875 A.2d 680.
[¶15] Susan also suggests that the court inappropriately looked to parol
evidence in determining the terms of the contract, despite finding it to be
unambiguous. Contrary to Susan’s contentions, the court looked to the subsequent
written materials only to determine whether they accurately memorialized the
terms orally agreed to on the record before the court reporter.
[¶16] Finally, Susan argues that the statements in the transcript cannot
constitute a binding agreement because 18-A M.R.S. § 3-912 (2013) requires that
the agreement be in writing, signed by all of the successors pursuant to the will.
Title 18-A M.R.S. § 3-912 provides:
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Subject to the rights of creditors and taxing authorities
competent successors may agree among themselves to alter the
interests, shares, or amounts to which they are entitled under the will
of the decedent, or under the laws of intestacy, in any way that they
provide in a written contract executed by all who are affected by its
provisions. The personal representative shall abide by the terms of
the agreement subject to his obligation to administer the estate for the
benefit of creditors, to pay all taxes and costs of administration, and to
carry out the responsibilities of his office for the benefit of any
successors of the decedent who are not parties. Personal
representatives of decedents’ estates are not required to see to the
performance of trusts if the trustee thereof is another person who is
willing to accept the trust. Accordingly, trustees of a testamentary
trust are successors for the purposes of this section. Nothing herein
relieves trustees of any duties owed to beneficiaries of trust.
(Emphasis added). On its face, section 3-912 sets forth the requirements for a
contract among successors to be binding on a personal representative. Id. Here,
the personal representative was herself a party to the agreement, and is in fact
seeking to enforce the agreement. Thus, by its plain language, section 3-912 does
not apply.
B. Necessity of Hearing
[¶17] Susan next argues that the Probate Court erred or abused its discretion
in granting the motion to enforce the settlement agreement without holding a trial
or an evidentiary hearing, or converting the motion to one for summary judgment.
[¶18] We have implicitly endorsed motions to enforce as appropriate
vehicles by which parties may bring an alleged settlement agreement before a trial
court. See White, 2005 ME 72, ¶¶ 5, 8, 10-13, 875 A.2d 680 (upholding a Probate
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Court judgment granting a motion to enforce a settlement agreement); see also
Fid. & Guar. Ins. Co. v. Star Equip. Corp., 541 F.3d 1, 5 (1st Cir. 2008) (“[A]
party to a settlement agreement may seek to enforce the agreement’s terms when
the other party refuses to comply. Where . . . the settlement collapses before the
original suit is dismissed, the party seeking to enforce the agreement may file a
motion with the trial court.” (citation omitted)). Whether to hold a hearing on such
a motion is ordinarily left to the discretion of the trial court. See M.R.
Civ. P. 7(b)(7) (“Except as otherwise provided by law or these rules, after the
opposition [to a motion] is filed the court may in its discretion rule on the motion
without hearing.”); M.R. Prob. P. 7(b) (adopting M.R. Civ. P. 7(b)).
[¶19] “[I]n circumstances where litigants dispute whether an enforceable
settlement was reached outside the presence of the court, findings of fact regarding
the terms of the agreement and the parties’ intent may be required.” Muther,
2009 ME 37, ¶ 6, 968 A.2d 539. For example, in Marie v. Renner, 2008 ME 73,
¶¶ 3-4, 6-10, 946 A.2d 418, we held that an evidentiary hearing was required
before the trial court could rule on a motion to enforce because the parties had not
waived such a hearing and the parties’ filings were “ambiguous” and “without
more [did] not disclose the existence of a binding settlement agreement as a matter
of law.” Cf. White, 2005 ME 72, ¶¶ 3-5 & n.2, 8, 10-13, 875 A.2d 680 (affirming a
judgment enforcing a settlement agreement after an evidentiary hearing where the
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settlement discussions were not recorded due to a tape recorder malfunction). In
contrast, where parties read a settlement agreement that contains all the necessary
elements of an agreement into the court record, no further fact-finding is required.
See, e.g., Muther, 2009 ME 37, ¶¶ 7-8, 968 A.2d 539 (holding that a transcript of
the parties’ recitation of a settlement agreement into the court record “without
more, conclusively establishes the existence of a binding settlement agreement as a
matter of law”); Toffling v. Toffling, 2008 ME 90, ¶¶ 4-5, 8-9, 953 A.2d 375
(upholding a judgment enforcing a settlement agreement recited into the record at a
final divorce hearing); Transamerica Commercial Fin. Corp. v. Birt, 599 A.2d 65,
65 (Me. 1991) (affirming a judgment based on a settlement placed on the record
before the court because “[t]he oral stipulation entered on the record . . . was
adequate to support the entry of a judgment finally disposing of the litigation”);
cf. Lane v. Me. Cent. R.R., 572 A.2d 1084, 1084-85 (Me. 1990) (holding that
summary disposition of a plaintiff’s claim based on an alleged settlement
agreement was error where the record revealed no evidence that the plaintiff’s
attorney was authorized to settle the case).
[¶20] The First Circuit has similarly held that
[t]he trial court may summarily enforce [a settlement] agreement,
provided that there is no genuinely disputed question of material fact
regarding the existence or terms of that agreement. When a genuinely
disputed question of material fact does exist, the court should hold a
hearing and resolve the contested factual issues.
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Fid. & Guar. Ins. Co., 541 F.3d at 5 (citation omitted); see also Malave v. Carney
Hosp., 170 F.3d 217, 220 (1st Cir. 1999) (“As a general rule, a trial court may not
summarily enforce a purported settlement agreement if there is a genuinely
disputed question of material fact regarding the existence or terms of that
agreement.”). The First Circuit has indicated, however, that this rule “assumes that
the parties, or at least one of them, requested [a testimonial] hearing and had
testimony worth presenting,” and that “[p]arties are perfectly free to submit issues
for resolution on whatever limited evidence they choose to present.” F.A.C., Inc.
v. Cooperativa de Seguros de Vida de P.R., 449 F.3d 185, 188, 194 (1st Cir. 2006)
(holding that the trial court did not err in not holding an evidentiary hearing where
the parties did not request one, the court was familiar with the settlement due to
judicial participation in the negotiations, and the appellant did not challenge the
court’s failure to hold a hearing).
[¶21] This is not a case in which the parties recited their agreement into the
trial court record, as in Muther, 2009 ME 37, ¶¶ 2, 7, 968 A.2d 539, or Toffling,
2008 ME 90, ¶¶ 4-5, 8-9, 953 A.2d 375. The parties, however, do not dispute the
authenticity or accuracy of the transcript that they submitted to the court, and the
court found that the transcript unequivocally reflects a binding settlement
agreement. Under these circumstances, the parties stand in essentially the same
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position as if the conference had occurred before the court, and in the absence of
ambiguity of the settlement language no evidentiary hearing was required.
Compare Muther, 2009 ME 37, ¶¶ 7-8, 968 A.2d 539, and Toffling, 2008 ME 90,
¶¶ 4-5, 8-9, 953 A.2d 375, with Marie, 2008 ME 73, ¶¶ 3-4, 6-10, 946 A.2d 418.
[¶22] Even if the Probate Court had erred or abused its discretion in
deciding the motion to enforce without holding an evidentiary hearing, we would
not vacate the court’s judgment unless the procedure employed was “inconsistent
with substantial justice.” M.R. Civ. P. 61; M.R. Prob. P. 61. Susan would
therefore need to “demonstrate both error and prejudice resulting . . . from the
claimed error.” S. Me. Props. Co. v. Johnson, 1999 ME 37, ¶ 9, 724 A.2d 1255
(holding that the court’s failure to hold a nontestimonial hearing on a motion for
attachment was harmless error). Susan has not precisely articulated how she was
prejudiced by the lack of an evidentiary hearing.
The entry is:
Judgment affirmed.
On the briefs:
J. Colby Wallace, Esq., Michael R. Bosse, Esq., and Daniel J. Mitchell, Esq.,
Bernstein Shur, Portland, for appellant Susan R. Snow
Brendan P. Rielly, Esq., and Lee Ivy, Esq., Jensen Baird Gardner & Henry,
Portland, for appellee Estate of Harold F. Snow
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At oral argument:
J. Colby Wallace, Esq., for appellant Susan R. Snow
Brendan P. Rielly, Esq., for appellee Estate of Harold F. Snow
Cumberland County Probate Court docket number 2011-1520
FOR CLERK REFERENCE ONLY