This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A16-0103
Anita W. Sluck,
Appellant,
vs.
Terence E. Rapacz,
Respondent.
Filed August 1, 2016
Affirmed
Stauber, Judge
Hennepin County District Court
File No. 27-CV-12-14348
Richard S. Eskola, Columbia Heights, Minnesota (for appellant)
Mary M.L. O’Brien, Kathleen M. Ghreichi, Meagher & Geer, P.L.L.P., Minneapolis,
Minnesota (for respondent)
Considered and decided by Stauber, Presiding Judge; Ross, Judge; and Johnson,
Judge.
UNPUBLISHED OPINION
STAUBER, Judge
Appellant challenges the district court’s order enforcing a settlement agreement,
arguing that the parties did not have a meeting of the minds and that her attorney did not
have authority to accept the settlement on her behalf. We affirm.
FACTS
Respondent Terrence Rapacz, a veterinarian, treated appellant Anita Sluck’s dogs.
In October 2009, Rapacz asked appellant’s late husband, John Sluck (Sluck), for a
$60,000 loan to cover delinquent real-estate taxes. Sluck loaned him $60,000, as well as
another $190,000 in March 2010. Despite the fact that Sluck was an attorney, the terms
of the loan were vague; Rapacz agreed to an interest rate of five percent per annum, but
there were no scheduled payments or a due date, and the loans were not documented in
writing. Rapacz asserted that he told Sluck he would make interest payments when he
was able to do so. Rapacz made three monthly interest payments of $1,041.75, and one
double payment of $2,083.50, in 2010, but made no other payments on the loans. Sluck
died in January 2011.
Appellant has been incapacitated since April 2008. In 2009 or 2010, Daniel
Koehler, a former neighbor of the Slucks, was given a power of attorney to act on behalf
of both Sluck and appellant. Koehler began this breach-of-contract and unjust-
enrichment action to collect the loan balance from Rapacz.
After a June 2013 court trial on the contract and unjust-enrichment claims, the
district court held that appellant failed to present sufficient evidence of a binding
contract. But the district court also concluded that appellant “met her burden of proof in
establishing a claim for unjust enrichment,” and ordered judgment against Rapacz in the
amount of $250,000 at five percent interest. Rapacz’s motion for amended findings or
new trial was denied. Rapacz appealed to this court, which reversed the district court’s
decision and remanded with the direction to determine if Rapacz had the current ability to
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repay the loans. Sluck v. Rapacz, No. A13-2268, 2014 WL 4056071, at *2 (Minn. App.
Aug. 18, 2014). This court also concluded that Rapacz had not been unjustly enriched by
failure to pay interest because there was no contract. Id.
On remand, the parties conducted more discovery. Appellant alleged that Rapacz
had the ability to pay because he was living extravagantly. Rapacz filed documents
showing that Koehler sought to have his wife and himself made beneficiaries of one of
the Sluck trusts.
A few days before the hearing on remand, Rapacz’s attorney, Kathleen Ghreichi,
sent a final settlement offer to appellant’s attorney, Richard Eskola. The terms of the
offer were set forth in an email:
*$1300 per month at 2.5% interest. If the practice is
sold during Dr. Rapacz’s lifetime, those monthly payments
would stop. At that juncture, [appellant] would instead receive
25% of the first down payment on the sale of the business, and
10% of any remaining payments until interest/principal are
met.
*All repayment obligations end upon Dr. Rapacz’s death.
Eskola replied that he had forwarded the settlement offer to Koehler. Three days later,
Eskola said he had “not yet heard back from my client on your last proposal and will try
to contact him this afternoon.” Later that day, Eskola called Ghreichi and said that
Koehler accepted the offer on appellant’s behalf. The same day, Eskola called the district
court and sent an email to the district court’s clerk indicating that “this case has settled
and Ms. Ghreichi is going to draft the settlement documents.” Ghreichi drafted
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settlement documents and forwarded them to Eskola. The settlement documents
conformed to the settlement proposal.
On July 17, 2015, Eskola emailed Ghreichi, saying “[W]e have a
misunderstanding, my client will only agree to continue the $1,300.00/month payments
even if your client sells the business . . . (instead of the 10 percent). Until his death or
until the princip[al] amount is paid in full. If this is a problem, please contact me.”
Rapacz moved for enforcement of the settlement agreement. Koehler submitted
an affidavit stating that he “misunderstood the terms of the proposed settlement as
explained to [him] by [his] counsel.” Koehler averred that he thought the payments
would continue even if Rapacz sold his practice.
After a hearing on September 22, 2015, the district court granted Rapacz’s motion
to enforce the settlement agreement. The district court determined that the emailed offer
was unambiguous, the email had been forwarded to Koehler, who was acting on
appellant’s behalf, and appellant’s attorney informed the court that the matter had been
settled. The court reasoned, “Simply because [appellant] has changed her mind and no
longer likes the terms of the settlement, are not reasons to vacate a settlement.” This
appeal followed.
DECISION
A settlement agreement is a contract. Dykes v. Sukup Mfg. Co., 781 N.W.2d 578,
581-82 (Minn. 2010). When contract terms are unambiguous, interpretation of a contract
is a question of law. Roemhildt v. Kristall Dev., Inc., 798 N.W.2d 371, 373 (Minn. App.
2011), review denied (Minn. July 19, 2011). An unambiguous contract will be enforced
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according to the language of the contract. Dykes, 781 N.W.2d at 582. “[District] courts
have the inherent power to summarily enforce a settlement agreement as a matter of law
when the terms of the agreement are clear and unambiguous.” Voicestream Minneapolis,
Inc. v. RPC Props., Inc., 743 N.W.2d 267, 272 (Minn. 2008) (quotation omitted).
Appellant argues that there was no meeting of the minds necessary to the
formation of a contract because he was mistaken as to its terms. As with any contract,
“there must be a definite offer and acceptance with a meeting of the minds on the
essential terms of the agreement.” TNT Props., Ltd. v. Tri-Star Developers LLC, 677
N.W.2d 94, 100-01 (Minn. App. 2004). But “[a] binding contract can exist despite the
parties’ failure to agree on a term if the term is not essential or can be supplied.” Id. at
101. An agreement may be affirmed “despite some incompleteness and imperfection of
expression,” if the parties’ intent can be discerned. Id. (quotation omitted).
The district court wrote, “The written offer is unambiguous and clearly lays out
the loan outcome in the event the business is sold.” The email setting forth the settlement
terms included the amount and frequency of payments and the interest rate, and stated, “If
the practice is sold during Dr. Rapacz’s lifetime, those monthly payments would stop.”
The agreement also sets forth the terms of what happens after the practice is sold and in
the event of Rapacz’s death. These terms are definite enough to create a binding
contract.
Appellant argues that her attorney lacked authority to enter into a binding
settlement agreement. “An attorney may bind a client, at any stage of an action or
proceeding, by agreement . . . made in writing and signed by such attorney.” Minn. Stat.
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§ 481.08 (2014). In order to do so, however, the attorney must have the client’s express
authority to enter into a settlement. Schumann v. Northtown Ins. Agency, Inc., 452
N.W.2d 482, 483-84 (Minn. App. 1990). But a written expression of authority is not
required; a client’s grant of authority to settle can be expressed through conduct.
Rosenberg v. Townsend, Rosenberg & Young, Inc., 376 N.W.2d 434, 437 (Minn. App.
1985). For example, in Rosenberg, this court concluded that the following record
evidence established the attorney’s authority to settle his client’s claim: (1) a letter from
the opposing party confirming a settlement agreement reached during a telephone
conversation; (2) the opposing party’s oral representation to the court that the client’s
attorney had authority to settle; (3) a previous settlement agreement in the same amount;
and (4) no immediate action by the client to repudiate the settlement. Id. And in
Schumann, (1) the client’s attorney sent the opposing party a letter accepting the
settlement offer; (2) a copy of the letter was sent to the client; and (3) the letter indicated
that the client’s attorney had contacted the client and the client had authorized the
settlement. 452 N.W.2d at 484.
Here, in an email exchange, Eskola stated that he “forwarded” Ghreichi’s email
containing the offer to Koehler. Three days later, Eskola said that he would contact
Koehler because he had not heard from him. Eskola called Ghreichi on July 7 to say that
Koehler had accepted the offer and subsequently called the district court to say that the
case was settled. Ten days later, and three days after receiving the formal settlement
documents, Eskola reported that Koehler said that he misunderstood the terms of the
settlement. Although in his affidavit Koehler said, “I misunderstood the terms of the
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proposed settlement as explained to me by my counsel,” he does not deny receiving the
forwarded email, or initially authorizing the settlement.
“Settlement of disputes without litigation is highly favored, and such settlements
will not be lightly set aside by the courts. The party seeking to avoid a settlement has the
burden of showing sufficient grounds for its vacation.” Johnson v. St. Paul Ins. Co., 305
N.W.2d 571, 573 (Minn. 1981) (citation omitted). The district court’s decision on
whether to vacate a settlement agreement will not be reversed absent an abuse of
discretion. Id. Later dissatisfaction with the terms of a settlement agreement is not a
sufficient basis for voiding the agreement. See Schumann, 452 N.W.2d at 485 (“A party
who voluntarily enters into a settlement agreement cannot avoid the agreement upon
determining . . . that the agreement has ultimately become disadvantageous or the
settlement amount paltry.”). The district court’s decision to enforce the settlement
agreement was not an abuse of discretion.
Affirmed.
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