Opinion ID: 418837
Heading Depth: 1
Heading Rank: 4

Heading: The Coss Settlement Offer.

Text: 31 The appellant contends that the FmHA's rejection of the Coss settlement offer estops the government from challenging its claim to that extent. (Appellant values this amount at approximately $320,000.) The trial judge, however, held that the FmHA was not out-of-step in rejecting the settlement offer, and therefore it was not estopped from challenging appellant's claim. We agree. 32 As mentioned earlier, at one point during the liquidation process the Cosses' attorney indicated that the Cosses might be willing to pay 50 percent of the debt remaining on the loan after all other collection efforts had been exhausted, if the bank would terminate its action against the Cosses. Although this was, as the trial judge found, by no means a hard offer, the bank informed the FmHA of this proposal. The only reason the bank could give to the FmHA for accepting this offer was that further litigation would postpone the likelihood of full collection for approximately another year and a half. Besides the obvious risks associated with the passage of time, the trial judge found that the bank gave no economically justifiable explanation ... in favor of its [the settlement offer's] acceptance. 33 Considering the information available to the FmHA, we do not believe it acted unreasonably in rejecting the Cosses' offer. The FmHA had no indication that the Cosses' financial stability was tenuous, or that any legal obstacles prevented recovery against the Cosses. Therefore, from the FmHA's perspective, the expected gain from litigation exceeded the gain from settlement. A reasonable person would thus have rejected the settlement offer, as did the FmHA. 34