Court Opinion

ID: 160380
Source: CourtListenerOpinion
Date Created: 2010-08-14 06:43:47+00
Date Added: 2024-06-11T15:04:22.803316
License: Public Domain

F I L E D
                                                                   United States Court of Appeals
                                                                           Tenth Circuit
                     UNITED STATES COURT OF APPEALS
                                                                            NOV 13 2000
                            FOR THE TENTH CIRCUIT
                                                                      PATRICK FISHER
                                                                               Clerk

    ADVANTAGE PROPERTIES, Inc.,

                Plaintiff-Appellant,

    v.                                                   No. 00-3014
                                                 (D.C. No. 99-CV-1078-MLB)
    COMMERCE BANK, N.A.,                                   (D. Kan.)

                Defendant-Appellee.

                            ORDER AND JUDGMENT            *

Before BALDOCK, ANDERSON,              and HENRY , Circuit Judges.

         After examining the briefs and appellate record, this panel has determined

unanimously to grant the parties’ request for a decision on the briefs without oral

argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore

ordered submitted without oral argument.

         Plaintiff-appellant Advantage Properties, Inc. (Advantage) appeals the

district court’s order enforcing the settlement agreement entered into by

*
      This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
Advantage and defendant-appellee Commerce Bank (Commerce). We have

jurisdiction pursuant to 28 U.S.C. § 1291, and following our review of the

parties’ briefs and the appellate record, we affirm.

                                      I. Background

       On March 1, 1999, Advantage, a minority-owned construction company,

filed a complaint against Commerce alleging racial discrimination in violation of

the Equal Credit Opportunity Act (ECOA), 15 U.S.C. §1691, and the Kansas

Consumer Protection Act (KCPA), Kan. Stat. Ann. § 50-623. The complaint

alleged that Commerce placed more stringent requirements on Advantage prior to

closing a loan than those required of nonminority applicants.

       Commerce moved to dismiss Advantage’s KCPA claims, alleging that

because the statute only applies to “individual[s] or sole proprietor[s],”

Advantage failed to state a claim for relief.          Id. § 50-624(b). Advantage

subsequently moved to join Gregory Barnes, its president and sole stockholder, as

a necessary party. In recommending that Commerce’s motion to dismiss be

granted and the joinder motion be denied, the magistrate judge agreed with

Commerce that, as a corporate entity, Advantage could not assert a claim under

the KCPA. See Wayman v. Amoco Oil Co.                 , 923 F. Supp. 1322, 1363 (D. Kan.

1996) (holding that “a corporation or similar entity that has suffered an injury as a

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result of a ‘deceptive’ or ‘unconscionable’ act or practice cannot assert a claim

under the KCPA”). When Advantage did not file objections to the magistrate

judge’s report and recommendation, the district court adopted it as its own.

      The parties entered mediation and reached an oral settlement agreement.

When Advantage refused to sign the written agreement, Commerce moved the

district court to enforce the agreement, counsel for Advantage moved to

withdraw, and the matter was set for hearing on November 15, 1999. At the

hearing, Advantage requested a continuance in order to obtain new counsel. The

district court granted the continuance, reset the hearing for December 13, 1999,

and directed new counsel for Advantage to enter an appearance on or before

November 30, 1999.

      At the December 13th hearing, Advantage, represented by Barnes, appeared

with new counsel retained the day before. New counsel for Advantage was from

Oklahoma and was not admitted to practice in Kansas district courts. He

requested a continuance in order to complete the admission process, review the

case, and prepare for hearing. The court agreed to another continuance

conditioned upon Advantage’s willingness to pay the expenses of the participants

and witnesses who had traveled from Kansas City to Wichita for a second hearing,

an amount approximated at between $3,000 and $4,000. When Barnes advised the

court that Advantage could not afford to pay these expenses, the court denied the

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continuance and scheduled the hearing to go forward later that same day.

Following testimony by the Commerce representative, the mediator, and former

counsel for Advantage, the court enforced the settlement and ordered Barnes to

sign the settlement check on behalf of Advantage.

       Advantage states its issues on appeal as: (1) whether the district court

lacked subject matter jurisdiction over Gregory Barnes, individually; (2) whether

there was evidence that Advantage intended to make Barnes a party to the

settlement agreement; (3) whether there was a meeting of the minds as to the

release of Barnes’ individual claims; (4) whether the district court’s denial of a

second continuance violated Advantage’s due process rights; and (5) whether

there was inferred fraud, duress, undue influence, or mistake in the inducement in

the settlement agreement.

                                        II. Discussion

       The trial court’s enforcement of a settlement agreement is reviewed by this

court for an abuse of discretion.       See United States v. Hardage     , 982 F.2d 1491,

1495 (10th Cir. 1993). Issues involving the formation, construction and

enforceability of a settlement agreement are resolved by applying state contract

law. See Carr v. Runyan , 89 F.3d 327, 331 (7th Cir. 1996);            Central Kan. Credit

Union v. Mutual Guar. Corp.         , 886 F. Supp. 1529, 1537 n.2 (D. Kan. 1995).

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       Kansas law favors agreements executed in the compromise and settlement

of disputes. See Ferguson v. Schneider Nat’l Carriers, Inc.    , 826 F. Supp. 398,

400 (D. Kan. 1993). “[I]n the absence of bad faith or fraud, when parties enter

into an agreement settling and adjusting a dispute, neither party is permitted to

repudiate it.”   Id.

       In the settlement agreement at issue here, the parties allegedly agreed that

all claims that “were, or could have been, asserted by ADVANTAGE and/or

BARNES against COMMERCE” were settled in exchange for a cash payment of

$20,000 to be split evenly between Advantage and its counsel. Appellant’s App.

at 48. In addition, Commerce agreed to provide Advantage with a satisfaction of

judgment in its suit against Lucky 7 Payday Loan, Inc., another corporation

owned by Advantage.     See id.

       Initially, Advantage argues that because the district court denied its motion

to join Barnes as a party, the district court had no jurisdiction to enforce a

settlement agreement that purported to dispose of Barnes’ individual claims

against Commerce. A party must support its argument with legal authority.          See

Primas v. City of Okla. City , 958 F.2d 1506, 1511 (10th Cir. 1992) (holding that a

party has a duty to cite authority for any argument raised). Because Advantage

fails to cite this court to any authority for its contention, and because in our

research we could find none, we consider the issue insufficiently developed to

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invoke appellate review.    See United States v. Hardwell , 80 F.3d 1471, 1492

(issue is waived when party fails “to make any argument or cite any authority to

support his assertion”),   reh’g granted in part on other grounds   , 88 F.3d 897

(10th Cir. 1996).

       Second, Advantage asserts that there was no evidence establishing that it

intended to release Barnes’ individual claims in the settlement agreement.

Advantage argues that because Barnes was not allowed to join as a party, his

individual claims were “carved out” of the settlement agreement, and because

Commerce objected to Barnes appearing on behalf of Advantage at the hearing, it

recognized that Barnes was not a party to the action. Appellant’s Br. at 20.

Advantage concludes that this supports its argument that Barnes did not intend to

release his individual claims. This argument is both convoluted and specious.

       Although Barnes was not a party to the lawsuit except in his capacity as

representative of Advantage, he certainly was a party to the settlement agreement.

If he desired to preserve his individual claims, he could have raised that issue for

negotiation during the mediation. There was no indication in the testimony of the

witnesses at the hearing, however, that Barnes sought to release only the claims of

the corporation. In fact, all of the witnesses testified that the terms of the written

agreement reflected the parties’ agreement following mediation. Further, the

district court offered Barnes ample opportunity to question the witnesses and

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challenge their testimony regarding the terms of the agreement, an offer he

declined.

      Next, Advantage asserts that there was no meeting of the minds as to the

terms of the settlement agreement releasing Barnes’ individual claims.      See Albers

v. Nelson , 809 P.2d 1194, 1198 (Kan. 1991) (“In order to form a binding contract,

there must be a meeting of the minds on all essential elements.”). Advantage

contends that the testimony at the hearing proved that it never intended to release

Barnes’ individual claims. We do not agree.

      Under Kansas law, when a dispute arises as to the terms of a settlement

agreement, “the agreement ‘must be construed in light of its language and the

circumstances surrounding its making.’”      Central Kan. Credit Union , 886 F.

Supp. at 1538 ( quoting In re Estate of Engels , 692 P.2d 400, 404 (Kan. Ct. App.

1984)). “Once it is shown that an attorney has entered into an agreement to settle

a case, a party who denies that the attorney was authorized to enter into the

settlement has the burden to prove that authorization was not given.”     Turner v.

Burlington N. R.R. , 771 F.2d 341, 345-46 (8th Cir. 1985). The written agreement

reflects the parties’ intent to end all litigation arising out of Advantage’s attempt

to obtain the loan from Commerce. The agreement does not contain any language

reflecting an intent to reserve Barnes’ right to institute any further litigation.

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       Here, both Advantage’s former attorney and the Commerce representative

testified that the terms of the agreement were those agreed upon at the mediation

conference. See Appellant’s App. at 88-90. Because Advantage did not meet its

burden of proving an intent different than that reflected in the written agreement,

the court was correct in enforcing the agreement as written.   See In re Estate of

Engels , 692 P.2d at 404 (“In the absence of language to the contrary, it must be

presumed the parties intended to settle the entire dispute.”). To do otherwise

would have given the parties’ agreement the unreasonable effect of allowing

Advantage to take advantage of the favorable terms of the agreement while

allowing Barnes to relitigate the same issues in the future.

       Advantage’s fourth issue claims that the district court’s denial of a second

continuance was a violation of its due process rights. We review the district

court’s denial of a continuance “under the standard of arbitrary abuse of

discretion, upon a showing of manifest injustice.”     Morrison Knudsen Corp. v.

Fireman’s Fund Ins. Co. , 175 F.3d 1221, 1229 n.4 (10th Cir. 1999) (quotation

omitted). We will not reverse the court’s decision on a continuance “unless we

conclude that the denial was arbitrary or unreasonable and materially prejudiced

the appellant.”   Id. (quotation omitted).

       When determining whether the denial of a continuance is unreasonable or

arbitrary, we look to several factors, including:

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      “[1] the diligence of the party requesting the continuance; [2] the
      likelihood that the continuance, if granted, would accomplish the
      purpose underlying the party’s expressed need for the continuance;
      [3] the inconvenience to the opposing party, its witnesses, and the
      court resulting from the continuance; [4] the need asserted for the
      continuance and the harm that appellant might suffer as a result of
      the district court’s denial of the continuance.”

United States v. Rivera , 900 F.2d 1462, 1475 (10th Cir. 1990) (   quoting United

States v. West , 828 F.2d 1468, 1470 (10th Cir. 1987)).

      The district court clearly informed Advantage that it needed to have new

counsel enter an appearance on or before November 30, 1999, and that the hearing

would go forward on December 13, 1999, without further continuance.

Advantage not only failed to obtain counsel within the court’s time restraints, it

requested an additional continuance while being aware that the court had

specifically stated no further continuances would be granted. Despite the court’s

clear pronouncement on further continuances, it did offer Advantage another

continuance conditioned upon Advantage’s agreement to reimburse the hearing

participants for their time and expenses. Advantage declined this offer.

Furthermore, Advantage made no showing as to how a continuance would have

accomplished its goals. The third factor, inconvenience to the parties and

witnesses, was stressed by the court as several participants, including counsel for

Advantage, had come from Kansas City at considerable expenditure of time and

money. Although Advantage asserts that the continuance was necessary to give

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its new counsel an opportunity to prepare for hearing, it fails to advise us how

further preparation would have affected the outcome of the hearing. Therefore,

we conclude that the district court’s denial of a second continuance was well

within the proper exercise of the court’s discretion.

       Although Advantage frames its final issue as asserting that it was under

duress and undue influence in agreeing to the terms of the settlement, its

argument appears to have little to do with duress or undue influence. The Kansas

Supreme Court has held that whether facts offered in a particular case “are

sufficient to constitute duress is a question of law” and that “[t]o constitute duress

there must be a wrongful act or wrongful threat which compels apparent assent by

another to a transaction without his volition.”    Hastain v. Greenbaum , 470 P.2d
741, 746 (Kan. 1970) (quotation omitted). Duress cannot be found where the

claiming party had the opportunity to reflect and had the benefit of counsel.    See

id. at 748; see also White v. General Motors Corp.     , 908 F.2d 669, 673 (10th Cir.

1990) (applying Kansas law to a determination of the existence of duress).

       Advantage does not identify any word or deed by any party to the

agreement or counsel which would fit within this definition of duress. The thrust

of its argument centers on its belief that its counsel did not adequately prosecute

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its motion to join Barnes as a party.    1
                                             Whether counsel’s advocacy of this motion

was adequate may or may not be adequate basis for a claim against counsel, but it

does not rise to the level of duress or undue influence. Advantage’s remaining

arguments on this issue are equally as unpersuasive.

                                        III. Conclusion

       “A trial court has the power to summarily enforce a settlement agreement

entered into by the litigants while the litigation is pending before it.”   Hardage ,

982 F.2d at 1496. Here, because there was a dispute as to the terms of the

agreement, the district court held an evidentiary hearing as required.      See id. In

so doing, the court was generously indulgent, giving Advantage every opportunity

to be adequately represented and to state its position and offer its evidence.

Advantage failed to avail itself of these opportunities.

       The record indicates that the parties entered into settlement negotiations in

good faith, and in reaching an agreement, Advantage had representation and the

benefit of counsel. All Barnes offered at the hearing was an expression of

displeasure with the terms of the agreement. Even if we were to conclude that

1
      We note that in its brief Advantage, citing to the record, states that its
former counsel admitted that the motion to join Barnes “was not well prosecuted.”
Appellant’s Br. at 27. We have read the hearing transcript carefully and can find
no instance where counsel made such an admission. In this light, we caution
counsel regarding taking undue liberties with representations of the record.

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this constituted conflicting evidence, the other evidence amply supports the

district court’s factual finding that there was a meeting of the minds as to the

terms of the agreement and that the parties entered into a valid oral contract to

settle the action. In this light, the court’s finding was not clearly erroneous,

see Fed. R. Civ. P. 52(a) and its order to enforce the contract as written was not

an abuse of discretion,   see Hardage , 982 F.2d at 1495.

       The judgment of the United States District Court for the District of Kansas

is AFFIRMED.

                                                      Entered for the Court

                                                      Robert H. Henry
                                                      Circuit Judge

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