Hansen v. Doan

BARNES, Presiding Judge,

dissenting.

I respectfully dissent. The uncontroverted record demonstrates that while the plaintiff expressly conditioned his settlement offer on the tender of a limited release with no indemnity language, Liberty Mutual instead tendered a limited release that contained indemnity language and simply promised to reach agreement on the precise terms of a release at some indefinite time in the future. Because Liberty Mutual’s actions did not constitute an unequivocal acceptance of the plaintiff’s settlement offer, there was no meeting of the minds, and no settlement was reached. The trial court’s order enforcing the alleged settlement thus should be reversed.

The principles of law applicable in this case are well established. “A settlement agreement must meet the same requirements of formation and enforceability as other contracts. Only when a meeting of the minds exists will an agreement be formed.” (Punctuation and footnote omitted.) Greenwald v. Kersh, 275 Ga. App. 724, 725-726 (621 SE2d 465) (2005). See Ruskin v. AAF-McQuay, Inc., 284 Ga. App. 49, 51-52 (1) (643 SE2d 333) (2007). Hence, as with offers made in other contexts, an offer of settlement “must be accepted in the manner specified by it; and if it calls for a promise, then a promise must be made; or if it calls for an act, it can be accepted only by the doing of the act.” (Citation and punctuation omitted.) Herring v. Dunning, 213 Ga. App. 695, 699 (446 SE2d 199) (1994). Furthermore, acceptance of a settlement offer must be “unequivocal [ ] and without variance of any sort.” (Citation and punctuation omitted.) McReynolds v. Krebs, 290 Ga. 850, 853 (2) (725 SE2d 584) (2012). Consequently, a purported acceptance of an offer to settle “that varies even one term of the original offer is a counteroffer.” (Citation and punctuation omitted.) Butler v. Household Mtg. Svcs., 266 Ga. App. 104, 106 (1) (596 SE2d 664) (2004). See Herring, 213 Ga. App. at 698 (“An answer to an offer will not amount to an acceptance, so as to result in a contract, unless it is unconditional and identical with the terms of the offer.”) (citation and punctuation omitted).

The record reflects that after the plaintiff suffered multiple fractures and other severe injuries when his motorcycle was struck by an automobile, his counsel sent a settlement demand letter to the other driver’s automobile insurance carrier, Liberty Mutual, on July 11, 2011. The July 11, 2011 settlement demand letter made a “time limited offer” for the plaintiff to sign a “Limited Release with Liberty Mutual Fire Insurance Company within the meaning of OCGA § 33-24-41.1 for the full $25,000 in policy limits.” The demand *616letter specified the precise manner of acceptance by Liberty Mutual:

To be accepted, the OCGA § 33-24-41.1 Limited Release in favor of Laura Henkleman Doan and Liberty Mutual Fire Insurance Company only (with no indemnity language) and the $25,000 check payable to only Lawrence Hansen and Robertson, Bodoh & Nasrallah, LLP must be received within twelve (12) days of you receiving this demand. The offer is automatically withdrawn if these conditions are not complied with within the time limit.

By its plain language, the settlement demand letter did not contemplate a mutual exchange of promises; rather, the offer required Liberty Mutual to perform by supplying the limited release “with no indemnity language” and the $25,000 check within 12 days of Liberty Mutual receiving the demand. See generally Penn v. Muktar, 309 Ga. App. 849, 850-851 (711 SE2d 337) (2011) (offer to settle required insurance company to perform certain acts within 20 days of demand letter); Carterosa, Ltd. v. Gen. Star Indent. Co., 221 Ga. App. 246, 248 (1) (489 SE2d 83) (1997) (noting that “the offeror may specify a method through which the offer must be accepted”).

Liberty Mutual met the requirement of tendering the $25,000 check representing the insurance policy limits, but not the additional requirement of tendering a limited release with no indemnity language. In this regard, on July 22, 2011, Liberty Mutual tendered a limited release to plaintiff’s counsel that did contain indemnity language.2 Accompanying that release was a letter from Liberty Mutual’s claims specialist which stated, “We will... agree to a limited release,” and further stated:

You indicated that you did not have a specific release you wanted to use. I am attaching the only limited release that I have which we can tailor to fit your needs. If you would please look it over and make your suggestions on any changes you wish to make then we can iron out those details.

*617The claims specialist concluded the response to the plaintiffs offer by stating, “Please get back to me at your earliest convenience so that we may conclude this matter.”

Liberty Mutual’s July 22, 2011 tender of a limited release containing indemnity language, when construed with the accompanying letter from the claims specialist, clearly did not constitute an unequivocal, unvarying acceptance. See McReynolds, 290 Ga. at 853 (2) (acceptance of a settlement offer must be “unequivocal[ ] and without variance of any sort”) (citation and punctuation omitted). The release itself varied from the terms of the original offer made in the settlement demand letter. Furthermore, the accompanying letter from the claims specialist simply expressed a willingness by Liberty Mutual to agree in the future to a limited release after ironing out the details based upon the plaintiff’s suggestions. The net effect was that Liberty Mutual tendered a nonconforming release offering to work out acceptable terms with the plaintiff.

An agreement to agree in the future does not create a binding contract. See John Bleakley Ford, Inc. v. Estes, 164 Ga. App. 547, 548 (1) (298 SE2d 270) (1982). Moreover, when an offer calls for acceptance through performance of a specific act, then the act must be performed for the offer to be accepted; a party does not accept the offer simply by promising to perform that specific act in the future. See Herring, 213 Ga. App. at 699. Accordingly, Liberty Mutual’s tender of the limited release containing indemnity language, qualified and conditioned in the accompanying letter on the parties reaching an agreement on the actual terms of a release, did not operate as an unequivocal acceptance of the settlement offer. It follows that there was never any meeting of the minds, and thus no enforceable settlement.3 See Penn, 309 Ga. App. at 850-851 (no settlement agreement formed, where plaintiff’s offer expressly conditioned agreement on insurer’s tender of release covering only bodily injury claims, but insurer tendered release covering “any and all claims” resulting from collision). See also McReynolds, 290 Ga. at 853-854 (2); Frickey v. Jones, 280 Ga. 573, 575-576 (630 SE2d 374) (2006); Kitchens v. Ezell, 315 Ga. App. 444, 447-449 (1) (a) (726 SE2d 461) (2012) (physical precedent only). Cf. Porgar, LLC v. CP Summit Retail, LLC, 316 Ga. App. 668, 672 (730 SE2d 136) (2012) (letter stating that it was tenant’s “intent” to exercise option to renew lease and requesting that *618landlord contact tenant to “discuss” rental rates and “agree to terms” did not constitute an operative notice of acceptance of the renewal option).

The majority, in concluding that a binding settlement agreement was formed, states that the Liberty Mutual claims specialist “clearly contemplated that [plaintiffs counsel] would strike through any portions of the release that were unacceptable to him,” and “specifically invite [d] plaintiffs counsel to change the releases to conform to the settlement demand.” But the letter from the claims specialist to plaintiffs counsel expressly referred to any proposed revisions by counsel as “suggestions,” and went on to state that the parties would “iron out those details” and then “conclude the matter” at a later time. While the claims specialist’s willingness to contemplate the plaintiff’s proposed changes to the release may indicate her good faith attempt to settle the matter, the letter cannot be read as giving the plaintiff’s attorney permission to unilaterally revise the release to his choosing without any further review and input from Liberty Mutual and without the latter having a chance to agree or disagree with the proposed revisions.4

The majority also relies upon the recent case of Turner v. Williamson, 321 Ga. App. 209 (738 SE2d 712) (2013), but that case is plainly distinguishable. Under Georgia law, unless an offer specifies otherwise, it can be accepted “either by a promise to do the thing contemplated therein, or by the actual doing of the thing.” Herring, 213 Ga. App. at 699. The settlement offer in Turner did not specify the mode of acceptance and thus could be accepted by a return promise made by the insurer. Therefore, as we held, a binding contract was formed in that case when the insurer agreed to provide the insurance policy limits in return for the plaintiffs’ execution of a limited release in accordance with OCGA § 33-24-41.1. Turner, 321 Ga. App. at 214 (2). In that context, where the settlement agreement could be formed through the exchange of mutual promises, the insurer’s presentation of a proper release for the plaintiffs to sign was a “condition of defendant’s performance” rather than an act necessary to the formation of a binding settlement. Id.

In contrast to Turner, the plaintiff’s settlement offer in the instant case could not be accepted merely by a return promise. Rather, as the plaintiff’s settlement demand letter makes clear, the offer to settle could only be accepted by performance, i.e., by Liberty *619Mutual’s tender of both the $25,000 check and a limited release with no indemnity language. Hence, the presentation of a limited release with no indemnity language was not merely a “condition of defendant’s performance” as in Turner, but rather an act necessary to acceptance of the plaintiff’s settlement offer. See Kitchens, 315 Ga. App. at 447-449 (1) (a); Penn, 309 Ga. App. at 850-851. The majority’s reliance on Turner, therefore, is misplaced.

Decided March 21, 2013 Robertson, Bodoh & Nasrallah, Keith D. Bodoh, for appellant. Brown & Adams, Jeffrey A. Brown, for appellee.

For these combined reasons, I believe that a binding settlement agreement was never reached by the parties and that the trial court’s order granting the motion to enforce the settlement should be reversed. Because the majority concludes otherwise, I must respectfully dissent.

I am authorized to state that Presiding Judge Miller and Judge McFadden join in this dissent.

Before tendering the limited release containing indemnity language to plaintiff’s counsel by fax, Liberty Mutual’s claims specialist contacted counsel by phone and, unbeknownst to counsel, recorded the conversation. During the call in which the issue of indemnity was never mentioned, plaintiff’s counsel cut short the conversation and noted that “the best way to deal with stuff” would be by fax rather than by telephone. Contrary to the defendant insured’s suggestion on appeal, there is nothing in the transcript of the abbreviated telephone conversation to indicate that plaintiff’s counsel intended to change the offer to no longer require Liberty Mutual to tender a limited release without indemnity language as a condition of a settlement being reached.

It may well be the case that the claims specialist was acting reasonably and in good faith and had the desire to reach a settlement with the plaintiff, and that any claim ultimately brought by the plaintiff pursuant to Southern Gen. Ins. Co. v. Holt, 262 Ga. 267 (416 SE2d 274) (1992), might fail. But the Soli issue presents a separate questionfrom whether Liberty Mutual made an unconditional acceptance of the settlement demand and thus from whether a binding contract was in fact formed between the parties.

It is worth noting that the claims specialist could have tendered a release that conformed to the settlement offer by simply striking out the indemnity language before tendering the release.