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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF FLORIDA

TALLAHASSEE DIVISION

FTN FINANCIAL CAPITAL MARKETS,

a division of First Tennessee Bank,

National Association,

Plaintiff/Counter-Defendant,

vs. 4:03-CV-249-SPM

MAGNOLIA CAPITAL ADVISORS,

INC.,

Defendant/Counter-Plaintiff,

_____________________________/

ORDER ENFORCING SETTLEMENT AGREEMENT

THIS CAUSE comes before the Court upon the “Defendants’ Motion to

Enforce Settlement Agreement” (doc. 173) filed February 9, 2005; the

memorandum in support thereof (doc. 179); and Plaintiff’s memorandum in

opposition (doc. 181). For the reasons set forth below, the Court finds the motion

must be granted.

FACTS

In order to understand the framework of the issue presented, a chronology

of events leading up to the filing of the motion must be laid out. Briefly, Plaintiff

and Defendants agreed to a settlement with certain details to be finalized. 

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 The term “Magnolia entities” includes Magnolia Capital Management, Inc.; Magnolia

Capital Management, LP; Magnolia Capital Partners, LP, f/k/a Magnolia Mortgage Partners, LP;

and Magnolia Capital Advisors.

Plaintiff sent Defendants a proposed settlement and release agreement with an

introductory paragraph binding only the named parties in the suit, viz., FTN

Financial Capital Markets (Plaintiff), Magnolia Capital Advisors, Inc. (Defendant),

and Don and Sarah Reinhard (Defendants). Defense counsel responded to the

proposal, making minor language adjustments and advising Plaintiff’s counsel

that she would attempt to have that agreement executed within three days, as

specifically requested by Plaintiff.

Plaintiff later sent a new version of the agreement which included various

Magnolia-related companies1 not present in the first agreement. Defense

counsel strenuously objected to this addition, arguing that she was not

authorized to settle on behalf of other parties. Plaintiff apparently refused to

honor the agreement without this inclusion, leading Defendants to file this motion

to enforce the settlement agreement.

A general chronology is set out below. 

January 25, 2005: Defense counsel Kelly O’Keefe e-mails Plaintiff with her

understanding of the terms of settlement; in particular, “MCAI and FTN will enter

a mutual release with terms to be agreed on.” O’Keefe states, “We can accept

the terms of the agreement outlined below provided that we can agree on the

terms of the release.”

January 25, 2005: Plaintiff responds with: “We have a deal in principal [sic], with

the terms and details to be reduced to writing. [A]s we have discussed, the

release will include related companies and individuals on both sides.” Plaintiff

goes on to say that a notice of settlement will be drafted and filed with the Court.

January 27, 2005: Plaintiff e-mails a proposed written “Mutual Release and

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4:03-cv-249-SPM

Settlement Agreement” to all parties. The introductory paragraph reads as

follows:

This Mutual Release and Settlement Agreement (“Agreement”) is

knowingly, willingly, and voluntarily entered into this ____ day of

_______, 2005, by and between FTN Financial Capital Markets

(“FTN”), Magnolia Capital Advisors, Inc. (“Magnolia”), Don Reinhard

(“Mr. Reinhard”) and Sarah Reinhard (“Mrs. Reinhard”) in order to

conclude, terminate, and settle any and all disputes between them.

January 27, 2005: Plaintiff e-mails the proposed Notice of Settlement to all

parties.

January 28, 2005: O’Keefe agrees to the Notice of Settlement.

January 28, 2005: After reviewing the proposed settlement agreement sent by

Plaintiff the day before, O’Keefe responds with: “Per our discussion I will attempt

to coordinate execution of the agreement by Monday as you requested . . . . I

cannot guarantee that it will be finalized by Monday. I will do what I can.”

January 31, 2005: Plaintiff’s counsel e-mails O’Keefe indicating that Plaintiff

wants to add Magnolia entities to the agreement: “Also, I needed to confirm with

you that all the Magnolia entities are bound by and benefit from the agreement. I

suggest that we add a section including those entities in the definition of

Magnolia as well as include them on the signature line with Capital Advisors,

since Don [Reinhard] will presumably be signing on behalf of all of them. 

Thanks.”

January 31, 2005: Plaintiff e-mails O’Keefe a new version of the agreement

including the Magnolia entities.

February 1, 2005: O’Keefe reviews the new version and specifically objects to

the addition of the entities: “Magnolia Capital Partners, LP is not a party to this

case so I don’t like the fact that you are now including them in the agreement.”

February 2, 2005: Plaintiff files a Notice of Settlement (doc. 171) stating that the

parties have reached a tentative settlement subject to agreement on specific

terms.

February 3, 2005: O’Keefe renews her objection: “Magnolia Mortgage Partners

is not a party to the suit and I cannot settle on behalf of it. The deal we agreed to

did not include Magnolia Mortgage Partners. In fact, Magnolia Mortgage was not

on the original settlement agreement you sent to me. This is a new term that you

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added after I agreed to the terms of the Notice of Settlement. I am prepared to

move forward with the settlement agreement that we initially discussed and I will

send you a signed copy of that agreement with my handwritten changes.”

February 4, 2005: O’Keefe faxes a copy of the original agreement with

defendant Don Reinhard’s signature to Plaintiff.

February 9, 2005: The instant motion to enforce settlement agreement is filed.

ANALYSIS

The determination as to whether a binding settlement agreement was

reached by the parties is governed by Florida contract law principles. U.S. Fire

Ins. v. Caulkins Indiantown Citrus Corp., 931 F.2d 744, 749 (11th Cir. 1991). The

standard of proof required to enforce a settlement agreement, provided one is

found to exist, is merely a preponderance of the evidence. E.g., South Beach

Sun Care, Inc. v. Sea & Ski Corp., 1999 WL 350458, at *11 (S.D. Fla. 1999).

Under Florida law, an objective test is employed to assess whether a

contract, or settlement, may be duly enforced. Robbie v. City of Miami, 469 So.

2d 1384, 1385 (Fla. 1985). This test considers not whether there was an

“agreement of two minds in one intention, but on the agreement of two sets of

external signs – not on the parties having meant the same thing but on their

having said the same thing.” Id. (quoting Gendzier v. Bielecki, 97 So. 2d 604,

608 (Fla. 1957) (citation omitted)). Courts have held that a settlement, even one

that is reached orally, “will be enforced as long as there is clearly an offer and

acceptance of the compromise and a meeting of the minds as to terms of the

agreement.” Wilson v. Wilson, 46 F.3d 660, 666 (7th Cir. 1995) (citations

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omitted).

There was unequivocally an offer and acceptance present here. Plaintiff’s

sending the proposed settlement agreement on January 27th constituted an

offer. Defendant accepted that offer with the e-mail stating counsel’s intention to

have that agreement executed by Monday (again, at Plaintiff’s request). This

correspondence clearly communicated to Plaintiff Defendant’s willingness to be

bound by that particular agreement and manifests the intention of both parties to

execute that version of the agreement. In addition, O’Keefe assented to the

notice of settlement being filed with the Court based on her understanding that

the agreement sent to her by Plaintiff just the day before was the version of the

agreement that would be utilized by the parties.

Plaintiff’s later addition of the Magnolia entities was quickly and

categorically rejected by Defendant through O’Keefe, who explicitly stated, “The

deal we agreed to did not include Magnolia Mortgage Partners. In fact, Magnolia

Mortgage was not on the original settlement agreement you sent to me.” She

went on to say, “This is a new term that you added after I agreed to the terms of

the Notice of Settlement,” and added, “I am prepared to move forward with the

settlement agreement that we initially discussed and I will send you a signed

copy of that agreement with my handwritten changes.” 

Plaintiff’s characterization of the agreement as tentative and non-binding

is particularly puzzling in light of the fact that it was Plaintiff who drafted and sent

the original agreement naming only the parties to the suit; drafted a proposed

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 The parties agree that granting the motion to enforce settlement agreement would

eliminate the need for a revised scheduling order. See doc. 197.

4:03-cv-249-SPM

Notice of Settlement based on that agreement; and then set a three-day deadline

for Defendants to execute and return the agreement. This conduct, inconsistent

with a refusal of the terms, raises a presumption of assent on which the other

party may rely. Wong v. Bailey, 752 F.2d 619, 621 (11th Cir. 1985).

Defendant, having been asked to expedite the execution of the agreedupon document, and having agreed to a notice of settlement based on that

document, is certainly entitled to rely upon that document as a binding

agreement. Plaintiff’s apparent unhappiness with its resultant strategic position

does not negate the validity of the settlement. It is therefore

ORDERED AND ADJUDGED as follows:

1. The motion to enforce settlement agreement (doc. 173) is hereby

granted.

2. The motion to vacate scheduling order (doc. 191) is denied as

moot.2

3. The parties are directed to abide by the terms of the “Mutual

Release and Settlement Agreement” as that agreement was

presented to Defendants on January 27, 2005.

DONE AND ORDERED this fourth day of May, 2005.

 s/ Stephan P. Mickle 

Stephan P. Mickle

United States District Judge

/pao

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