Court Opinion

ID: 4435104
Source: CourtListenerOpinion
Date Created: 2019-08-30 19:09:08.191961+00
Date Added: 2024-06-11T14:27:37.000195
License: Public Domain

[Cite as Wilson v. Pride, 2019-Ohio-3513.]

                               COURT OF APPEALS OF OHIO

                             EIGHTH APPELLATE DISTRICT
                                COUNTY OF CUYAHOGA

KILEY WILSON, ET AL.,                              :

                 Plaintiffs-Appellants,           :
                                                            No. 107793
                 v.                                :

SPENCER PRIDE, ET AL.,                             :

                 Defendants-Appellees.             :

                                JOURNAL ENTRY AND OPINION

                 JUDGMENT: REVERSED AND REMANDED
                 RELEASED AND JOURNALIZED: August 29, 2019

            Civil Appeal from the Cuyahoga County Court of Common Pleas
                                Case No. CV-17-883441

                                             Appearances:

                 Fred D. Middleton, for appellants.

                 Ciano & Goldwasser, L.L.P., Andrew S. Goldwasser, and
                 Sarah E. Katz; Law Office of John J. O’Shea, P.L.C., and
                 John J. O’Shea, for appellees.

LARRY A. JONES, SR., J.:

                   This case stems from an automobile accident that occurred in 2013

when a Mack truck, driven by defendant-appellee Spencer Pride (“Pride”), collided

with a car driven by plaintiff-appellant Kiley Wilson. Wilson sustained injuries that

required surgery on both shoulders. The trial court enforced a settlement agreement
between the parties and this appeal followed. Finding merit to the appeal, we

reverse and remand the case to the trial court.

                           Procedural History and Facts

                In 2015, Wilson filed a complaint against Pride and his employer,

Ferris Process of Cleveland (collectively referred to as “Pride”). Also named as

plaintiffs in the complaint were two minors who were riding in Wilson’s vehicle at

the time of the accident and Wilson’s wife, Quavae Wilson (“Quavae” and the

plaintiffs are at times collectively referred to as “Wilson”). Wilson dismissed his

complaint but refiled it in 2017 against the same parties. In his complaint, Wilson

alleged: (1) Pride was at fault for the accident; (2) Pride’s employer was responsible

for Pride’s negligence; (3) Wilson incurred over $14,000 in medical expenses and

would continue to incur expenses; (4) each minor incurred $1,162 in medical

expenses; (5) Wilson incurred property damage in the amount of $5,355.42 and car

rental expenses totaling $1,057.84; and (6) a loss of consortium claim on behalf of

Quavae.1

                Trial for the case was set for Monday, September 10, 2018. Attorneys

for the parties engaged in settlement negotiations by phone the Thursday and Friday

prior to trial, September 6 and 7. Appellee’s attorney claimed that the parties did,

in fact, reach a settlement agreement on September 7, agreeing to settle the case for

$25,000. Approximately 20 minutes after the parties allegedly agreed on a $25,000

      1   Quavae’s claim was later dismissed pursuant to Civ.R. 41.
settlement, appellee’s attorney sent an email to the court, copying appellant’s

attorney, to inform the court that the parties had reached a settlement. Upon receipt

of the email, appellant’s attorney phoned the court, informing the court that the

parties had not reached a settlement.

              Wilson subsequently filed a motion to vacate the settlement. Pride

responded with a motion to enforce the settlement agreement. The settlement

agreement was never reduced to writing.

              In his motion to vacate the settlement agreement, Wilson stated that

his attorney never agreed to the $25,000 offer because there had not been a

“complete agreement as to the settlement for the children because [appellant’s]

counsel never had any discussion with the parents of the minor children regarding

the settlement or authority to settle their case.” In the motion to enforce, Pride

argued that a settlement agreement had been reached and Wilson should be bound

by their oral agreement.

              On September 10, the court issued a journal entry stating that the

parties had reached a settlement and ordered the parties to file a dismissal entry

within 30 days of the entry. The court also scheduled a hearing on the parties’

competing motions for the next day, September 11.

              The matter proceeded to a hearing on September 11. Appellee’s

attorney, Wilson, and the father of the two minor plaintiffs testified under oath and

were subject to cross-examination.

              The following evidence was adduced at the hearing.
                Appellee’s attorney testified that he contacted appellant’s attorney on

September 6, 2018, and extended a settlement offer for $25,000. Appellant’s

attorney countered with a demand for $75,000 to settle all claims.

                Later that day, appellee’s attorney again phoned appellant’s attorney

and told the attorney that he (appellee’s attorney) had spoken with the court’s staff

attorney and discovered that the court ruled on several pretrial motions in Pride’s

favor.    Appellee’s attorney requested that counsel for the appellant take the

settlement offer back to his client, stating that the offer might “no longer be on the

table” if appellee had to incur the cost of trial preparation.

                Specifically, appellee’s attorney testified that he called appellant’s

counsel on the morning of September 7 and

         informed him that the $25,000 settlement offer was still on the table
         and we would appreciate it if he would get back to us as soon as
         possible because we were in preparation for trial and due to the costs
         that the company was going to incur over the weekend, I would not ─
         could not guarantee that that money would still be available on [the
         day of trial].

                Appellee’s attorney testified that appellant’s attorney called him two

hours later, around 12:30 p.m., and agreed to the $25,000 settlement offer.

According to appellee’s attorney, appellant’s attorney proposed that the settlement

funds be apportioned as follows: $21,000 to Wilson and $2,000 to each minor

child. Appellant’s counsel then asked counsel for appellee about the Medicaid lien

─ Wilson’s injuries totaled over $40,000 in medical bills, approximately $15,000 of

which Medicaid paid the Cleveland Clinic. Appellee’s attorney testified:
      I informed him [appellant’s attorney] that I would need to check with
      the company regarding how they wanted to handle the Medicaid lien,
      because Medicaid paid certain medical bills and that I would call him
      back regarding the Medicaid lien after I spoke to [co-counsel] about
      how the company wanted to handle that particular matter, and I also
      told him that I would confirm in writing the settlement.2

                Appellee’s counsel admitted appellant’s attorney asked for a return

call regarding the Medicaid issue, but did not think it warranted further discussion

with regard to the proposed settlement: “I considered it to be how the company

wanted to treat the Medicaid payment on the settlement check.”

                On cross-examination, appellee’s attorney insisted that although

appellant’s attorney had asked for a return call to discuss the Medicaid payment and

he had not made the return call, any discussion of the Medicaid payments was not

“a further discussion of the settlement.” Appellee’s attorney testified:

      I did not consider it to be a further discussion of the settlement. I
      considered it to be how the company wanted to treat the Medicaid
      payment on the settlement check. In other words, whether the
      company was going to include Medicaid on the check or going to write
      a separate check to Medicaid, how that was going to be handled.

                Appellee’s attorney testified that he informed appellant’s attorney

that he was going to confirm the settlement in writing but did not tell appellant’s

attorney that he planned on emailing the court to say that the case had been settled.

Appellee’s attorney further admitted that he emailed the court without opposing

counsel’s knowledge. According to appellee’s attorney, appellant’s attorney called

him back shortly after they agreed to settle the case to say that Wilson had “changed

      2The   settlement was never reduced to writing.
his mind” and was not going to accept the $25,000 settlement offer. Appellee’s

attorney testified that counsel for appellant never indicated during settlement

negotiations that he did not have authority to accept a settlement offer on behalf of

his clients or that he needed to discuss the terms of the settlement with his clients

prior to accepting an offer.

               Appellee’s attorney stipulated during the hearing that appellant’s

counsel called the court’s staff attorney shortly after receiving appellee’s email notice

to the court, and stipulated that appellant’s counsel told the staff attorney that his

client was not willing to go forward with the settlement and no settlement had been

reached.

               Wilson testified that he did not discuss a $25,000 settlement offer

with his attorney, would not accept a settlement in that amount, had outstanding

medical bills, and wanted to proceed with trial. The father of the two minor plaintiffs

testified that neither he nor the children’s mother agreed to a $4,000 settlement,

would not settle for that amount, and wanted to proceed with trial.

               Following the hearing, the court issued an opinion denying Wilson’s

motion to vacate and granting Pride’s motion to enforce the settlement agreement:

      Plaintiffs failed to present any evidence to rebut [appellee attorney’s]
      testimony that [appellant’s attorney] accepted the $25,000
      settlement offer on behalf of his clients. [Appellant’s attorney] chose
      not to testify. Neither of Plaintiffs’ witnesses were parties to the
      telephone call between [opposing counsel] on Friday 9/7/2018 at
      12:30 p.m. Plaintiffs’ motion to vacate settlement is not evidence that
      plaintiffs can rely upon to support [appellant attorney’s] version of
      events.
      ***

      Plaintiffs presented no evidence regarding the phone call that took
      place between [opposing counsel] on Friday 9/7/2018 at
      approximately 12:30 p.m. The only evidence before the court
      regarding this phone call is the testimony of [appellee’s attorney],
      leaving no factual dispute for this court to resolve.

      The parties have entered into a binding settlement agreement because
      there was a meeting of the minds as to the essential terms of the
      contract. There was sufficient particularity in the oral settlement
      agreement to form a binding contract. A party cannot refuse to
      proceed due to a mere change of mind. Plaintiffs’ counsel accepted
      the defendants’ offer of settlement as the agent of all plaintiffs and
      therefore had apparent authority to finalize the terms of the
      settlement agreement.

              It is from this decision that Wilson appeals, raising the following

assignments of error for our review:

      I. The court erred when it ordered settlement based on “undisputed
      evidence” despite plaintiff’s denial they entered an agreement for
      settlement of the case and refused to have a hearing to consider
      plaintiff’s filed motions to vacate the order of settlement.

      II. The court erred by excluding the direct, circumstantial evidence
      and stipulated evidence that plaintiff never accepted an offer or made
      the oral contract.

      III. The court erred when it forced a settlement on parties who did not
      accept or approve the settlement.

      IV. The court erred when it failed to find the alleged agreement did
      not state all the necessary terms to create a binding contract.

                                  Law and Analysis

              In the first assignment of error, Wilson claims that the trial court

erred when it granted Pride’s motion to enforce without considering Wilson’s
motion to vacate the settlement agreement. Specifically, Wilson argues that the trial

court ignored his motion and only considered Pride’s motion. We disagree.

               Before the hearing started, the trial court noted on the record:

“[Appellant’s attorney] filed a motion to vacate settlement of the case and closing

case judgment entry. On behalf of the defense, there was a motion to enforce the

settlement[,] * * * we are going to hear arguments from both parties in this case.”

               The trial court proceeded to do just that ─ hear arguments from both

parties. Wilson’s attorney decided not to testify in support of his motion to vacate,

telling the court, “I’d rather not [testify] as the counsel.” In its September 13, 2018

journal entry granting Pride’s motion, the trial court stated “Defendant’s motion to

enforce settlement, filed 09/10/2018 is granted. Plaintiff’s motion to vacate journal

entry of settlement, filed 09/09/2018, is denied.”

               Although Wilson contends that the court failed to consider his

motion, it is clear that the trial court considered both motions and found Wilson’s

motion to be without merit.

               Accordingly, the first assignment of error is overruled.

               In the second assignment of error, Wilson contends that the trial

court erred by failing to consider evidence that his attorney did not accept the

$25,000 settlement agreement.

               Wilson claims that the trial court should have considered statements

his attorney made in his motion to vacate as “persuasive evidence” because the trial

court stated at the hearing that the “hearsay rules” would be relaxed. We disagree.
Unlike the testimony given at the hearing, the statements appellant’s attorney made

in his motion to vacate were not under oath or subject to cross-examination and

were not in affidavit form. Wilson’s attorney chose not to testify at the hearing,

telling the court “I’d rather not [testify] as the counsel.”

               Under Ohio law, arguments of counsel are not evidence to be

considered by the trier of fact. See Grove v. Fresh Mark, Inc., 156 Ohio App. 3d 620,

626, 808 N.E.2d 416 (8th Dist.2004) (“Passionate argument of counsel is not

evidence.”) In this case, each party had an opportunity to present witnesses and

submit exhibits into evidence. Wilson’s counsel chose not to testify. Thus, he chose

not to submit his version of events as factual evidence in this case.

               In light of the above, the second assignment of error is overruled.

               In the third assignment of error, Wilson contends that the trial court

erred in enforcing the settlement agreement. In the fourth assignment of error,

Wilson contends that the settlement agreement was not enforceable because “there

was no meeting of the minds.” We consider these assignments of error together.

               A settlement agreement is a contract designed to terminate a claim by

preventing or ending litigation. Rayco Mfg. v. Murphy, 2018-Ohio-4782, 117
N.E.3d 153, ¶ 32 (8th Dist.), citing Continental W. Condominium Unit Owners Assn.

v. Ferguson, 74 Ohio St. 3d 501, 660 N.E.2d 4317 (1996). Like any other contract, a

settlement agreement requires an offer, acceptance, consideration, and mutual

assent between two or more parties with the legal capacity to act. Rayco at id. The

burden of establishing the existence and terms of a settlement agreement lies with
the party who claims it exists. Id., citing Turoczy Bonding Co. v. Mitchell, 8th Dist.

Cuyahoga No. 106494, 2018-Ohio-3173, ¶ 19, citing Nilavar v. Osborn, 127 Ohio

App.3d 1, 11, 711 N.E.2d 726 (2d Dist.1998).

               An oral settlement agreement may be enforceable if there is sufficient

particularity to form a binding contract. Kostelnik v. Helper, 96 Ohio St. 3d 1, 2002-

Ohio-2985, 770 N.E.2d 58, ¶ 15, citing Spercel v. Sterling Industries, Inc., 31 Ohio

St.2d 36, 39, 285 N.E.2d 324 (1972). Oral settlement agreements may be binding

and enforceable even though the settlement terms are negotiated without the trial

court’s assistance. Walland v. Rinehart, 8th Dist. Cuyahoga Nos. 51935 and 52672,

1987 Ohio App. LEXIS 6805, 4 (Mar. 26, 1987). “The agreement need not be in

writing and no funds are required to be exchanged in order to establish the existence

of the settlement contract.” Id.

               In Ivanicky v. Pickus, 8th Dist. Cuyahoga No. 91690, 2009-Ohio-37,

this court noted:

      It is preferable that a settlement be memorialized in writing. However,
      an oral settlement agreement may be enforceable if there is sufficient
      particularity to form a binding contract. Terms of an oral contract may
      be determined from words, deeds, acts, and silence of the
      parties. * * *

      To constitute a valid settlement agreement, the terms of the
      agreement must be reasonably certain and clear * * *.

(Citations omitted). Id. at ¶ 9, quoting Kostelnik at ¶ 15, 17.

               A settlement agreement may also be enforced regardless of whether

it has been reduced to writing so as long as the terms of the agreement can be
established by clear and convincing evidence.        Carkido v. Sweeney, 8th Dist.

Cuyahoga No. 107383, 2019-Ohio-460, ¶ 15, citing Shetler v. Shetler, 9th Dist.

Wayne No. 00CA0070, 2001 Ohio App. LEXIS 2289, 3 (May 23, 2001). Clear and

convincing evidence “is that which will provide in the mind of the trier of facts a firm

belief or conviction as to the facts sought to be established.” Shetler at id., citing

Cincinnati Bar Assn. v. Massengale, 58 Ohio St. 3d 121, 122, 568 N.E.2d 1222 (1991).

               This court has held that that “[o]nce a settlement offer has been

accepted, the settlement agreement is mutually binding; the settlement agreement

cannot be set aside simply because one of the parties later changes its mind.” Rayco,

2018-Ohio-4782, 117 N.E.3d 153, at ¶ 31; see also Turoczy Bonding Co., 8th Dist.

Cuyahoga No. 106494, 2018-Ohio-3173, at ¶ 18 (“Once there is * * * a meeting of the

minds, one cannot refuse to proceed with settlement due to a mere change of

mind.”). This court has also recognized that when a client authorizes his or her

attorney to negotiate a settlement and the attorney negotiates a settlement within

the scope of that authority, the client is bound by it. Rayco at id.; see also Bromley

v. Seme, 2013-Ohio-4751, 3 N.E.3d 1254, ¶ 25 (11th Dist.) (holding that a party may

be bound by the conduct of his or her attorney in reaching a settlement).

               The standard of review applied when reviewing a ruling on a motion

to enforce a settlement agreement depends on the question presented. Carkido at

¶ 15; Rayco at ¶ 29. If the question is a factual or evidentiary one, the reviewing

court will not overturn the trial court’s finding if there was sufficient evidence to

support the finding. Turoczy at ¶ 15, citing Chirchiglia v. Ohio Bur. of Workers’
Comp., 138 Ohio App. 3d 676, 679, 742 N.E.2d 180 (7th Dist.2000). If the issue is a

question of contract law, the reviewing court must review the agreement de novo to

determine whether the trial court’s order is based on an erroneous standard or a

misconstruction of the law. Turoczy at id. Wilson raises a factual issue on appeal:

Did Wilson’s attorney, on behalf of the plaintiffs, agree to the defendants’ settlement

offer? Wilson also raises a legal issue, which we review de novo: Did the parties

agree upon all the essential terms of the alleged oral settlement agreement? See

Kinnett v. Corporate Document Solutions, Inc., 1st Dist. Hamilton No. C-180189,

2019-Ohio-2025, ¶ 27.

               Pride contends that Wilson is bound by the settlement agreement

because Wilson’s attorney had full authority to settle the claims on Wilson’s behalf

and Wilson belatedly changed his mind about accepting the settlement offer.

According to Wilson, he did not change his mind. Rather, there was no meeting of

the minds as to the essential terms of the settlement agreement, specifically, the

parties had not agreed on what would be done with the Medicaid reimbursement.

               It is uncontested that the attorneys for the parties discussed a

$25,000 settlement offer. Appellant’s attorney questioned the effect the Medicaid

reimbursement would have on the settlement, and appellee’s counsel conceded he

never “got back” to appellant’s counsel on the matter. Appellee’s counsel also never

told appellant’s counsel that he would inform the court of the settlement; he only

told appellee’s counsel that he would confirm the settlement in writing, which he

never did. As soon as appellant’s attorney discovered that appellee’s counsel had
emailed the court to say the parties had reached a settlement, appellee’s counsel

phoned the court to say that there had not, in fact, been an agreement.

              Wilson and the father of the two injured minors testified that they had

not agreed to settle for $25,000. Although “[a] party cannot avoid a settlement that

was negotiated through counsel by claiming that his [or her] attorney lacked actual

authority to enter into the settlement,” Rayco, 2018-Ohio-4782, 117 N.E.3d 153, at

¶ 31, Wilson testified that he only told his attorney “to fight as well as you can and

let me know.” Wilson further argues that his attorney called Pride’s attorney on

September 7, 2018, to ask for clarification with regard to Medicaid reimbursement,

not to accept the $25,000 settlement offer.

              Pride relies on this court’s holding in Rayco, where this court upheld

the trial court’s enforcement of a settlement agreement. Rayco is distinguishable

from the case at bar. In Rayco, the settlement agreement was “evidenced by writings

on all sides, including the mutual exchange of drafts of the written settlement

agreement that set forth the essential terms of the settlement.” Id. at ¶ 40. Here,

the alleged agreement was never reduced to writing. As Pride stipulated to during

the hearing, as soon as appellant’s attorney became aware of appellee’s email to the

court, appellant’s attorney called the court to say that no settlement had been

reached.

              Other Ohio cases we reviewed involve either settlement agreements

that had been reduced to writing, see Kostelnik, 96 Ohio St. 3d 1, 2002-Ohio-2985,

770 N.E.2d 58, parties who testified that they initially agreed to the oral settlement
offer but then changed their mind, see Brilla v. Mulhearn, 168 Ohio App. 3d 223,

2006-Ohio-3816, 859 N.E.2d 578 (9th Dist.); in-court settlement agreements, see

Kolar v. Shapiro, 11th Dist. Lake No. 2007-L-148, 2008-Ohio-2504, ¶ 21, or

settlement agreements where there was a passage of time between the alleged

acceptance and revocation of the acceptance, see, generally, Ivanicky, 8th Dist.

Cuyahoga No. 91690, 2009-Ohio-37.

              In light of the above, there was insufficient evidence to support the

trial court’s finding that the parties had reached a settlement. Based on the parties’

testimony and the trial court record, the terms of the alleged agreement were not

stated with sufficient particularity and Wilson’s assent to those terms were not

established by clear and convincing evidence. A more logical explanation based on

the evidence before this court is that Pride offered to settle for $25,000 and Wilson

needed more clarification as to what effect the Medicaid reimbursement would have

on the settlement amount ─ would Pride’s employer reimburse Medicaid or would

the Medicaid reimbursement come out of the settlement proceedings? This is

evidenced by counsel for appellee’s testimony at the hearing:

      I considered [the discussion] to be how the company wanted to treat
      the Medicaid payment on the settlement check. In other words,
      whether the company was going to include Medicaid on the check or
      going to write a separate check to Medicaid, how that was going to be
      handled.

              We find that, contrary to Pride’s claim, the effect a $15,000 Medicaid

reimbursement would have on a $25,000 settlement offer was a material part of the
agreement.3 Pride never offered that clarification and instead emailed the court

stating the case had been settled a mere 20 minutes after Wilson’s alleged

acceptance. Once Wilson discovered Pride’s email, he contacted the court to clarify

that no settlement had been reached. Thus, there was no meeting of the minds. In

reaching this conclusion, we have also considered the amount of time that passed

between the offer of settlement on September 6 and the alleged acceptance on

September 7 and the amount of time, a couple of hours, that passed between the

alleged acceptance, appellee counsel’s email to the court that the offer had been

accepted, and appellant attorney’s call to the court to dispute that an agreement had

been reached.

                In light of the above, the trial court erred in granting Pride’s motion

to enforce the settlement agreement and denying Wilson’s motion to vacate the

settlement agreement.

                The third and fourth assignments of error are sustained.

                Judgment reversed; case remanded for proceedings consistent with

this opinion.

      It is ordered that appellants recover from appellees costs herein taxed.

      The court finds there were reasonable grounds for this appeal.

      3Using a 30% contingency fee as an example, if Wilson settled the case for $25,000,

with $4,000 going to the minor claimants and his attorney receiving 30% of the total
settlement amount, Wilson would recover around $14,700, which is less than what was
owed to Medicaid.
      It is ordered that a special mandate be sent to said court to carry this judgment

into execution.

      A certified copy of this entry shall constitute the mandate pursuant to Rule 27

of the Rules of Appellate Procedure.

LARRY A. JONES, SR., JUDGE

PATRICIA ANN BLACKMON, P.J., and
RAYMOND C. HEADEN, J., CONCUR