Quint v. A.E. Staley Manufacturing Co.

United States Court of Appeals
For the First Circuit

No. 00-1181
00-1532

JACQUELYN QUINT,

Plaintiff, Appellant,

v.

A.E. STALEY MANUFACTURING COMPANY,

Defendant, Appellee.

APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MAINE

[Hon. Morton A. Brody, U.S. District Judge]
[Hon. Eugene W. Beaulieu, U.S. Magistrate Judge]

Before

Selya, Stahl, and Lynch, Circuit Judges.

Donald R. Furman, Jr., with whom Law Firm of Donald R. Furman,
Jr., was on brief, for appellant.
Brent A. Singer, with whom Rudman & Winchell, LLC, was on brief,
for appellee.

April 11, 2001
 LYNCH, Circuit Judge. In 1997, Jacquelyn Quint won an award

of $300,000 under the Americans with Disabilities Act after a jury

found her Maine employer, the A.E. Staley Manufacturing Company, had

discriminated against her based on her disability. This court affirmed

the verdict but remanded on the question of whether Quint was entitled

to reinstatement. Quint v. A.E. Staley Mfg Co., 172 F.3d 1 (1st Cir.

1999). Thereafter two things happened. The parties entered an oral

settlement agreement, which the district court concluded, over Quint’s

objections, resulted in an enforceable settlement. The magistrate-

judge simultaneously concluded that Quint was not entitled to

reinstatement. Quint appeals from both determinations. We decide only

the first issue and affirm the conclusion that Quint indeed settled her

case, despite her later protestations that she did not.

I.

The facts are taken from the district court’s uncontested

findings of fact following its evidentiary hearing and from uncontested

testimony.

After this court’s decision in the spring of 1999, both sides

had incentives to settle. Quint’s attorney, Stephen Roach, with

authorization from his client, sent a letter to Staley’s attorney, John

McCarthy, dated August 2, 1999, which outlined a proposed settlement.

In that letter, Quint proposed that the claims which were upheld by

this court be settled for $385,000, inclusive of prejudgment interest.

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Quint also proposed that the remaining claims for reinstatement (and

front pay) then pending before the magistrate-judge be settled for an

additional $200,000 plus two years of health benefits. The letter also

recounted that the parties had agreed to resolve the issue of

attorneys' fees separately.

The employer’s lawyer responded to the letter on August 9,

1999, with a phone call to Quint’s lawyer, who was then with Quint at

Quint’s house. The two lawyers quickly agreed on the $385,000 figure.

McCarthy counter-offered to the $200,000 demand with an offer of

$50,000, no health benefits, and a "no-reapply for employment"

provision as a condition of settling the remaining claims. After some

back and forth, McCarthy made a final offer of $100,000 to settle the

reinstatement (and front pay) claim provided that Quint agreed that she

would never apply for a job with any Staley company. McCarthy also

abandoned his earlier demand for a confidentiality provision, a demand

which Quint had previously said she would not accept.

Roach took the offer and later called McCarthy back. He said

that his client would accept Staley’s last offer. These two lawyers

repeated the core elements. In an abundance of caution, McCarthy

attempted to reconfirm that the parties had a final settlement for a

total of $485,000 and Quint would not attempt to back out. At this

point McCarthy heard Roach put down the phone and tell Quint about

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McCarthy’s request for reassurance that the agreement was final. Quint

responded affirmatively and McCarthy, on the phone, heard her do so.

With this reconfirmation of the oral agreement, the lawyers

agreed to memorialize it in writing the next day (August 10). At this

point in the conversation, Roach indicated that there was some tax

language he wanted in the agreement, and that he would fax the language

to McCarthy. He did so that afternoon. The tax treatment of the

settlement agreement had not been raised previously in the day's

negotiations, however, nor was the issue discussed in Roach's August 2

letter, which formed the basis for the settlement discussions. To the

contrary, the district court found that it was mentioned only as an

afterthought. In any event, Staley was prepared to agree to any tax

language which did not require it to lie. Believing the case to be

settled, counsel cancelled Quint’s deposition scheduled for the next

morning.

The next morning, August 10, 1999, Quint’s attorney Roach,

before receiving a response to his proposed tax language, called

McCarthy. He said that Quint no longer wished to settle the case on

the terms they had agreed upon the day before. Indeed, the language

Roach used was that Quint wanted to "withdraw from the settlement" and

"back out." Quint then fired Roach and hired a new lawyer. Efforts by

a magistrate-judge at conference to get the settlement back on track

failed.

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 Staley moved to enforce the settlement. After an evidentiary

hearing, the district court concluded, based on these facts, that Roach

had actual authority to settle the case, that Quint had agreed to the

settlement, and that there was mutual assent to the material terms of

a contract: Quint would receive $485,000 in exchange for releasing all

of her claims (except for workers' compensation claims), Quint would

not apply for a job with any Staley company, attorneys' fees would be

negotiated separately, and the agreement would not be confidential.

The court also concluded that tax language was not a material term of

the settlement and that, in any event, the parties would have no

problem in adding mutually acceptable tax language to the release. As

a result, the court ordered that Quint execute a release in a form

reasonably satisfactory to both parties which embodied the terms of the

agreement, and that Staley pay into the court registry the $485,000.1

Quint eventually executed a release under court order and

under protest; the protest did not have to do with the specific

language of the release but rather pertained to her view that there was

no settlement. Quint’s attorneys had negotiated the language of the

form release, but Quint had a new demand: that Staley withhold money

for employment taxes. In ordering Quint to sign the release, the

district court rejected that as a reason not to sign.

1 The payment into the court registry was requested by Staley,
which did not want to be embroiled in the disputes Quint had with her
various attorneys over what she owed them.

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 Quint retained new counsel yet again to pursue her appeal.

II.

The district court's determinations are mixed questions of

fact and law, to which we apply a sliding scale standard of review

under the label of clear error review. Sierra Fria Corp v. Evans, 127

F.3d 175, 181 (1st Cir. 1997). The more the district court's

conclusions are characterized as factual conclusions, the more our

review of those facts is for clear error; the more the district court's

conclusions are conclusions of law, the more independent review we

give. Id.; see also Reich v. Newspapers of New England, Inc., 44 F.3d

1060, 1069-70 (1st Cir. 1995); Belanger v. Wyman-Gordon Co., 71 F.3d

451, 453-54 (1st Cir. 1995). Where, as here, the underlying action is

brought pursuant to a federal statute, whether there is an enforceable

settlement is a question of federal, rather than state, law. Malave v.

Carney Hosp., 170 F.3d 217, 220 (1st Cir. 1999). Because the action

was still pending at the time, the district court had the power to

enforce a settlement agreement. Id. Quint's argument before the

district court that she was entitled to a jury trial on the enforcement

issue has been abandoned on appeal.

Quint makes two categories of argument on appeal. First, she

argues that the court erred in determining there was an agreement

because the mutual oral assertions did not manifest assent to all

material terms of a bargain. Second, she says that there could not be

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a contract in the absence of an executed written document because both

parties had contemplated there would be one. Her word was not her

bond, in sum, as these considerations excused her.

Quint argues that there was sufficient ambiguity as to the

meaning of three material terms of the oral agreement that any

conclusion that there was a contract was clearly erroneous. Those

terms are the no-reapply provision, confidentiality, and taxation.

Staley, she argues, was required to show there was "a bargain in which

there is a manifestation of mutual assent to the exchange and

consideration." Restatement (Second) of Contracts § 17 (1981). She

also argues that Staley's evidence of mutual assent to the oral bargain

had to meet a "clear and convincing" evidence standard of proof, rather

than the usual preponderance standard. But Quint has waived the issue

by not raising it with the trial court; in any event, the evidence that

there was a contract meets either standard.

Quint relies on the doctrine that the terms of a contract

must be sufficiently definite to be enforceable. Quint says that she

agreed not to reapply for employment to "any" Staley company, and that

term is ambiguous. She adds that while she did not agree to what would

happen if she violated that pledge, the written agreement has her

promise to resign and hold the company harmless for her breach. It is

clear there is no ambiguity about the term "any" in this context and

that she made such a promise. If she disputed the terms of an

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enforcement provision, that was a matter to raise with the district

court. She did not, and her counsel negotiated the agreed-upon

settlement papers. In any event, the issue does not go to contract

formation.

As to confidentiality, Quint says she never knew Staley had

withdrawn its request for confidentiality. But Staley accepted her

demand that there be no confidentiality clause in its final offer on

August 9, and her argument is not relevant to contract formation.

Again, she did not raise this objection to the district court; again,

it would not have led to a different determination. As to taxation,

the issue was, as the district court found, an afterthought, and the

parties have agreed on mutual language, so Quint has been benefitted,

not harmed.2

Quint's argument, that when the parties to an agreement

contemplate a written document will memorialize a contract, there can

be no agreement until the document is executed, is a radical and doomed

departure from the principles of contract law. If that were so, for

example, no party could ever settle in the courthouse by oral

agreement. But that is not the law. There are certainly instances in

which no oral contract is formed where material terms are not yet

2 In any event, the IRS is not bound to accept the parties'
characterization. See Rozpad v. Commissioner, 154 F.3d 1, 4 n.3 (1st
Cir. 1998).

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agreed upon, and no agreement is reached until there is written

agreement embodying those material terms. See Salem Laundry Co. v. New

England Teamsters and Trucking Indus. Pension Fund, 829 F.2d 278, 280-

81 (1st Cir. 1987). Here, the material terms were agreed upon, and

Quint cannot escape the consequences of her agreement because she spoke

but did not write. And Quint's argument that her attorney had

authority to bargain but not to settle in the absence of a written

agreement is undercut by the district court's factual findings and by

Quint's own verbal assent to the settlement. We add that there was

nothing unfair about the bargain reached; some might have urged Quint

to take the money and count it a victory.

We affirm.

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