Opinion ID: 2345248
Heading Depth: 1
Heading Rank: 5

Heading: The Abell-James Settlement Agreement

Text: After Mr. Dyer and the estate of Mr. King announced their settlement, the remaining parties agreed to settle as well. On August 23, 2007, plaintiffs (including Mr. James) and defendants (including Mr. Abell, Modern Management, and Ms. Bartola) signed a settlement agreement and release, acknowledging that it represents a fully binding and complete settlement. . . . Plaintiffs and defendants agreed to completely release and forever discharge [one another] from any and all past, present, or future claims, which each person had at signing or which may hereafter accrue or otherwise be acquired as a result of . . . any and all known or unknown claims by [each party] . . . for any injury or claim for compensation of any nature whatsoever. . . . In addition, both plaintiffs and defendants expressly waive[d] and assume[d] the risk of any and all claims they ha[d] or may have [had] against each other for damages at that point. Defendants also specifically agreed to forgive any requests, demands or claims for payments owing or allegedly owing to Defendants from Mr. James in relation to [his former home]. They further agreed to pay plaintiffs $395,000, $140,000 of which was to go to Mr. James, with payment to be completed on or before December 31, 2007 as specified in Paragraph 12 herein. Paragraph 12 provided, among other things, that all payments shall be delivered by hand, or by Federal Express or a similar delivery service offering a tracking service, to Jeffrey Pariser, plaintiffs' counsel. To help satisfy defendants' obligations under the agreement, Mr. Abell listed and sold Mr. James' former home. At that point, the defendants discovered that a personal judgment against Mr. James for $10,263.75 had been recorded as a lien against the property on October 6, 2000. With interest, it totaled $30,981.77. Mr. Abell paid that sum to release the lien and then sold the property. Subsequently, defendants deducted the $30,981.77 from what they owed and paid Mr. James $109,018.23 instead of $140,000. In response, plaintiffs filed a motion to enforce the settlement agreement. The trial court denied the motion, concluding that the agreement contemplated Defendants relieving James of financial liability related to his mortgage and did not envision Defendants assuming responsibility for liens securing personal judgments against him.
Neither Mr. Abell nor Mr. James disputes that the settlement agreement was a binding contract. Instead, they disagree about whether the terms of their agreement were ambiguous and whether a court may consider extrinsic evidence in construing its provisions. As previously discussed, because we follow the objective law of contracts, we will not inquire beyond contractual terms unless the language of the agreement is ambiguous. See Akassy v. William Penn Apartments Ltd., 891 A.2d 291, 303 (D.C.2006). In other words, absent ambiguity, we enforce written contracts according to their terms. See Sutton, 686 A.2d at 1048; Saslaw v. Rosenfeld, 148 A.2d 311, 312 (D.C. 1959) (The construction of a release is governed by the intent of the parties as manifested in the language of the instrument.). A contract is not ambiguous where the court can determine its meaning without any other guide than a knowledge of the simple facts on which, from the nature of language in general, its meaning depends. Burbridge v. Howard Univ., 305 A.2d 245, 247 (D.C.1973) (citing 17A C.J.S. Contracts § 294, at 34-35 (1963)). The Superior Court erred by not enforcing the settlement agreement, which unambiguously required Mr. Abell and Modern Management to deliver $140,000 to Mr. James' counsel. Pursuant to the objective theory of contract law, we hold parties to the promises they articulate, without attempting to discern their unexpressed intentions. Bolling Federal Credit Union, 475 A.2d at 385 (The language of the release is sufficiently clear to preclude, under parol evidence principles, the use of extrinsic evidence to probe the parties' intentions.). Accordingly, it is not relevant whether the parties contemplated defendants having to pay to discharge a lien based on a personal judgment. Defendants agreed in plain language to deliver $140,000 to Mr. James' counsel. This situation is not conceptually different than if the house had sold for less than anticipated. Under the terms of the settlement agreement, Mr. Abell would still owe $140,000.
Even if they were relevant, the equities in this case would not weigh against enforcing the agreement according to its plain language. First, defendants' argument that they did not know about the lien ignores the rule that a purchaser of real property is deemed to have constructive notice of all properly recorded encumbrances relating to that property. Stuart v. American Security Bank & National Permanent Federal Savings & Loan Ass'n, 494 A.2d 1333, 1338 (D.C.1985). Because Bank of America recorded the lien in the District of Columbia property records in 2000, defendants had the ability to conduct, and ran the risks of not conducting, a title search. Anderson v. Reid, 14 App. D.C. 54, 68 (1899) (Public records give constructive notice of their contents, and by failing to review those records, individuals incur the liability of shutting their eyes to the facts which they might have discovered upon examination.). [13] The defendants are real estate professionals and should be well aware of the rules and procedures regarding title searches. Second, under the agreement, Mr. Abell relinquished his right to offset the amount he paid to remove the personal judgment lien on Mr. James' property. In theory, Mr. Abell could have fulfilled his contractual duties (paid Mr. James $140,000) and then brought an action seeking indemnification, or claiming unjust enrichment, under his theory that the contract did not cover obligations to a third party in relation to a personal judgment. As explained in more detail above, however, defendants executed very broad releases of plaintiffs from any past, present or future claims. . . . They therefore surrendered any claim for indemnification or unjust enrichment. By the clear terms of the settlement agreement, defendants still owe Mr. James the difference between $140,000.00 and what they have thus far paid.