Court Opinion

ID: 9898051
Source: CourtListenerOpinion
Date Created: 2023-11-14 19:28:06.913581+00
Date Added: 2024-06-11T09:14:52.647834
License: Public Domain

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          IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

           BRIANNA GARZA and MARIO GARZA,
           wife and husband ,                             DIVISION ONE

                                Respondents,              No. 83377-4-I

                        v.                                PUBLISHED OPINION

           MATTHEW PERRY, an individual,

                                Defendant.

                          and

           AMERICAN FAMILY INSURANCE
           COMPANY,

                       Appellant Intervenor.

                DWYER, J. — Brianna Garza and her spouse Mario Garza filed a lawsuit

          against Matthew Perry premised on injuries she sustained in an automobile

          collision. Two months prior to the scheduled trial date, the Garzas and Perry

          reached a settlement agreement by which the Garzas obtained a covenant

          judgment against Perry in the amount of $2.5 million. Perry’s insurer, American

          Family Insurance Company (AmFam), intervened in the action in an attempt to

          nullify the settlement agreement based on the language of a mutual release

          clause contained within the written memorialization of the agreement. The trial

          court denied AmFam’s request and found that the settlement agreement was

          reasonable. Finding no error, we affirm.
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          No. 83377-4-I/2

                                                           I

                  On March 27, 2018, Matthew Perry caused an automobile collision that

          injured Brianna Garza. Perry was solely at fault for the collision. Brianna1

          suffered extensive injuries as a result of the collision, including a traumatic brain

          injury (TBI). The TBI caused a complete personality change in Brianna: she now

          experiences memory problems, cannot multitask, becomes unexpectedly

          emotional, and is frequently anxious or irritable. Her personal and professional

          relationships have suffered as a result.

                  The Garzas filed suit against Perry on April 10, 2019. The Garzas

          extended multiple offers to AmFam to settle the matter, but AmFam declined

          them all.

                  After almost two years of failed settlement attempts, the Garzas

          approached Perry with an offer to settle in exchange for an assignment of rights.

          Both AmFam and Tyson & Mendes, the law firm it had appointed to represent

          Perry, advised Perry that he might wish to seek independent legal advice

          concerning the offer. Perry did so, hiring attorney Patrick Trudell to represent

          him.

                  On December 23, 2020, Perry and the Garzas entered into a settlement,

          agreeing to a covenant judgment in the amount of $2.5 million. AmFam was not

          a party to the settlement and played no role in its negotiation.

                  Paragraph 20 of the written memorialization of the settlement agreement

                  1 Because Brianna Garza and Mario Garza share the same last name, we refer to them

          individually by using their first names. We intend no disrespect.

                                                           2
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          No. 83377-4-I/3

          reads as follows:

                 This Settlement Agreement shall be provided to Defendant’s
                 insurers for review so that Defendant’s insurers may consider
                 whether to fully protect Defendant from the claims of plaintiff for
                 injuries and damages Plaintiffs sustained in the crash at issue. If,
                 within 30 days from the date that this Settlement Agreement is
                 signed, Defendant’s insurers provide written proof to Defendant,
                 and to Plaintiffs’ attorneys, that Defendant’s insurers will pay all
                 injuries and damages sustained by Plaintiffs in the crash at issue
                 for which defendant may be found liable, and to fully indemnify
                 defendant for any final judgment which may be entered against him
                 for these claims, then the parties mutually release each other from
                 all terms and conditions of this Settlement Agreement and all
                 benefits and obligations of both parties to this agreement, including
                 refund by Plaintiffs to Defendant of any payments made by
                 Defendant pursuant to this Settlement Agreement.

                 The parties filed a notice of settlement the same day, striking the jury trial

          scheduled for February 8, 2021. Brian Sullivan, counsel for the Garzas, sent an

          e-mail to Tyson & Mendes notifying the firm that it had reached a settlement with

          Perry. A copy of the settlement agreement was attached to the e-mail. In the e-

          mail, Sullivan asked Tyson & Mendes to relay one final settlement offer to

          AmFam:

                 Please tell American Family the following: if we are forced to litigate
                 this matter further, the floor value of this case will be $2.5M. With
                 the assigned bad faith, consumer protection act, and other claims,
                 the final value is much higher. My client wants resolution and
                 hereby makes the following offer to American Family: she will agree
                 to dismiss all potential claims arising from the crash, as well as her
                 claims pursuant to the settlement and covenant judgment, for
                 $2,500,000 if paid in full to my office within 10 business days (4:30
                 PM Pacific time on January 8, 2021).

                 On December 31, 2020, AmFam sent a letter to Sullivan and Trudell,

          informing them that it “agrees that it will waive the applicable limits of $250,000

          so that the matter can proceed to trial. Should a verdict be returned in excess of

                                                    3
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          No. 83377-4-I/4

          $250,000 American Family will fully indemnify Mr. Perry and pay the full

          judgment.” In this letter, AmFam further stated, “We understand by waiving the

          limits in this manner, the parties to the Settlement Agreement have now mutually

          released each other from all terms and conditions of the Settlement Agreement

          and all benefits and obligations of both parties to the Settlement Agreement.”

                Sullivan responded to AmFam’s letter, informing AmFam that its

          interpretation of the settlement agreement was at odds with the parties’ intent.

          On January 14, 2021, the parties to the settlement agreement, the Garzas and

          Perry, executed a document entitled “Supplement to 12/23/2020 Settlement

          Agreement.” The document reads in relevant part as follows:

                14.The parties’ intent for paragraph 20 was not for American Family
                   to force a trial and formal judgment to be entered against Mr.
                   Perry, but instead for the Court to approve the reasonableness
                   of the Settlement Agreement with this Supplemental Agreement
                   incorporated, for American Family to promptly pay the approved
                   settlement, with the agreement to pay the approved settlement
                   the triggering event to release further actions by the parties,
                   such as of the assigned claims for bad faith and the required
                   cooperation of Mr. Perry in that subsequent action.

                15.The parties did not anticipate the issue that has arisen as a
                   result of the drafting of Paragraph 20, and now acknowledge
                   that Paragraph 20 of the Settlement Agreement has created
                   confusion and by its plain language is subject to interpretation in
                   a manner at odds with the intent of the parties.

                16.Therefore, the parties agree, pursuant to Paragraph 21 of the
                   Settlement Agreement that the contents (and any releases) of
                   Paragraph 20 from the Settlement Agreement are hereby
                   stricken from the December 23, 2020 Settlement Agreement,
                   and replaced as follows:

                       The Settlement Agreement shall be provided to
                       Defendant’s insurers for review so that Defendant’s
                       insurers may consider whether to fully protect

                                                   4
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          No. 83377-4-I/5

                       Defendant from the claims of Plaintiffs for injuries and
                       damages Plaintiffs sustained in the crash at issue.
                       Plaintiffs will be noting a reasonableness hearing to
                       approve the Settlement Agreement with the Superior
                       Court. If, within 10 business days of the Court’s
                       Order on the reasonableness hearing, American
                       Family pays the approved amount to Plaintiffs’
                       Counsel, in trust for the Garza Family, then the
                       parties agree to mutually release each other from all
                       claims and to end all claims and litigation over the
                       March 27, 2018 crash forever.

                On January 11, 2021, AmFam moved to intervene in the lawsuit between

          the Garzas and Perry. The trial court granted the motion.

                On January 22, 2021, the Garzas filed a “Motion for Court Approval of the

          Reasonableness of Settlement.” The Garzas requested that the motion be heard

          on January 28, 2021.

                Three days later, AmFam filed a motion to either strike or continue the

          hearing on the Garzas’ motion. In its motion, AmFam indicated that it would be

          filing a motion “to enforce the contract between AmFam, the Garzas, and Mr.

          Perry that formed when AmFam unambiguously accepted the terms and

          conditions of Paragraph 20.” AmFam argued that a continuance of the

          reasonableness hearing would prevent the parties from incurring expenses in

          preparing for what could be a moot issue and would allow it time to conduct

          necessary discovery. AmFam further argued that responding to the

          reasonableness motion would require it to disclose Tyson & Mendes’ litigation

          strategy, which, if the trial court granted AmFam’s motion to enforce and returned

          the matter to the trial calendar, would provide the Garzas with an unfair

          advantage in the ongoing proceedings.

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          No. 83377-4-I/6

                 AmFam also filed a motion for partial summary judgment, asking the trial

          court to enforce the original paragraph 20 of the settlement agreement and reset

          the matter for trial. This motion was set to be heard on February 23, 2021.

                 On January 29, 2021, Judge David Kurtz of the Snohomish County

          Superior Court struck the reasonableness hearing from the calendar. In his

          order, Judge Kurtz deemed the reasonableness hearing “premature” in light of

          the multiple competing motions filed by the Garzas and AmFam. Judge Kurtz did

          not set a new date for the reasonableness hearing.

                 Although Judge Kurtz had already stricken the reasonableness hearing,

          AmFam nonetheless filed a reply in support of its motion to strike on February 1,

          2021. Therein, AmFam reiterated its request to authorize a period of discovery

          and asked the court to schedule the reasonableness hearing for no earlier than

          45 days after the court’s decision on its motion for partial summary judgment.

                 On February 2, 2021, Judge Richard Okrent issued a ruling resetting the

          reasonableness hearing for March 2, 2021. Judge Okrent’s order reads in

          relevant part as follows:

                 2. Having reviewed the filings of the parties, the Court concludes
                    that the reasonableness hearing should be continued 30 days.
                    However, there will be no further continuances without good
                    cause shown.
                 3. The motion to strike pleadings is denied.
                 4. The reasonableness hearing shall take place before Judge
                    Okrent on March 2nd at 3:00 pm. If that date and time is
                    unavailable for the parties, they may contact Judge Okrent’s law
                    clerk to reschedule.

                 AmFam subsequently filed a notice of disqualification for Judge Okrent.

          On March 1, 2021, Judge Okrent entered an order denying AmFam’s request to

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          No. 83377-4-I/7

          disqualify him. On March 30, 2021, AmFam filed a notice for discretionary

          review, asking this court to accept review of its proposed interlocutory appeal of

          Judge Okrent’s order refusing to disqualify himself. On April 16, 2021, our

          commissioner entered a ruling denying discretionary review. The commissioner

          so ruled because “it appears Judge Okrent did more than resetting the

          reasonableness hearing.”

                     On April 20, 2021, the trial court entered an order denying AmFam’s

          motion for partial summary judgment.

                     The trial court conducted a three-day reasonableness hearing starting on

          June 23, 2021.2 The trial court heard testimony from multiple lay and expert

          witnesses concerning the underlying dispute and the possible outcome were the

          matter tried to a jury. Following the hearing, the trial court found that the $2.5

          million settlement was reasonable.3

                                                             II

                     AmFam first asserts that Judge Okrent erred by not recusing himself after

          AmFam filed a notice of disqualification. We disagree.

                     Disqualification of a single judge without a showing of prejudice is a right

          granted to parties by statute. Harbor Enters., Inc. v. Gunnar Gudjonsson, 116

          Wn.2d 283, 285, 803 P.2d 798 (1991); see RCW 4.12.050. We review issues of

          statutory construction de novo. Pub. Util. Dist. No. 2 of Pac. County v. Comcast

                     2 The reasonableness hearing was continued due to discovery disputes between the

          parties.
                     3 The Garzas ask us to take judicial notice of a complaint filed by AmFam against the

          Garzas and Perry in federal court. Because the existence of outside litigation is not relevant to
          our decision on appeal, we decline to do so.

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          No. 83377-4-I/8

          of Wash. IV, Inc., 8 Wn. App. 2d 418, 449, 438 P.3d 1212 (2019).

                 RCW 4.12.050(1)(a) provides that any party may disqualify one judge from

          taking action in a case so long as the notice of disqualification has been “filed

          and called to the attention of the judge before the judge has made any

          discretionary ruling in the case.” The limited exceptions to this rule are

          enumerated in the statute:

                 Even though they may involve discretion, the following actions by a
                 judge do not cause the loss of the right to file a notice of
                 disqualification against that judge: Arranging the calendar, setting a
                 date for a hearing or trial, ruling on an agreed continuance, issuing
                 an arrest warrant, presiding over criminal preliminary proceedings
                 under CrR 3.2.1, arraigning the accused, fixing bail, and presiding
                 over juvenile detention and release hearings under JuCR 7.3 and
                 7.4.

          RCW 4.12.050(2). If the notice of disqualification is timely filed, the judge must

          recuse from the case. Godfrey v. Ste. Michelle Wine Ests. Ltd., 194 Wn.2d 957,

          961-62, 453 P.3d 992 (2019).

                 On February 2, 2021, Judge Okrent issued an order setting the

          reasonableness hearing, previously stricken by Judge Kurtz, for March 2.

          AmFam characterizes this order as an order “setting a date for a hearing” that did

          not cause the loss of its right to disqualify Judge Okrent. However, it is not the

          form of the motion that determines whether the judge’s ruling thereon falls within

          the statutory exemption; rather, it is the “substance and impact” of the motion that

          controls. State v. Lile, 188 Wn.2d 766, 778, 398 P.3d 1052 (2017). Reviewing

          the totality of the matters considered and resolved in Judge Okrent’s order, it is

          apparent that the order did far more than simply set a date for a hearing.

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          No. 83377-4-I/9

                 In its “Motion to Strike or Continue Plaintiffs’ Motion for Court Approval of

          Reasonableness of Settlement,” AmFam argued that the reasonableness hearing

          should not take place on the scheduled date because it intended to file a motion

          for summary judgment, which, if granted, would unwind the settlement

          agreement and moot the reasonableness determination. AmFam also argued

          that if it had to litigate the reasonableness of the settlement first, it would have to

          divulge its litigation strategy, which in turn would be highly prejudicial if its

          summary judgment motion were granted and the matter proceeded to trial.

          Further, AmFam requested that the reasonableness hearing be set for no sooner

          than 45 days from the date of the order because it wished to conduct discovery.

          Thus, AmFam was not merely asking the trial court to pick a new date on the

          calendar. Instead, to impose order on the sprawling set of contradictory requests

          for relief and related matters it was necessary for Judge Okrent to familiarize

          himself with all of the various arguments and issues pending before the court and

          prioritize the various issues, including whether the parties were entitled to

          discovery and whether any motion needed to be ruled on in the order.

                 That Judge Okrent’s order was not merely a scheduling order is further

          evidenced by AmFam’s reply in support of its motion. On January 29, Judge

          Kurtz entered an order striking the scheduled date for the reasonableness

          hearing. This was the relief that AmFam sought in its initial motion, which should

          have ended the dispute. Instead, while acknowledging that the reasonableness

          hearing had already been stricken, AmFam filed a reply asking the trial court to

          hear its summary judgment motion before any other proceedings and to grant it a

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          No. 83377-4-I/10

          minimum 45-day period in which to conduct discovery.

                  Judge Okrent’s ruling on AmFam’s motion thus required him to decide

          whether the reasonableness hearing should occur before or after the summary

          judgment motion scheduled for February 23, 2021, and decide if AmFam should

          be allowed to conduct discovery and, if so, how much time AmFam should be

          allowed to do so. These issues, in turn, required consideration of what rights

          AmFam had as an intervenor in the action. The decision rendered bears little

          resemblance to the typical order setting a hearing date, which requires only that

          the court check its schedule and verify the availability of the parties. As it

          required him to prioritize the issues and assess the rights of an intervening party,

          Judge Okrent’s order was not a mere calendaring order of the type exempted

          from RCW 4.12.050. Accordingly, Judge Okrent did not err by declining to

          recuse himself.

                                                          III

                  AmFam next asserts that the trial court erred by denying its motion for

          summary judgment and declining to enforce paragraph 20 of the settlement

          agreement entered into by Garza and Perry and to reset the matter for trial.4

          This is so, AmFam asserts, because when it was notified of the settlement

          agreement, paragraph 20 was intended as a contractual offer to AmFam.

          AmFam contends that it subsequently accepted that offer, thereby creating a

                   4 Because Garza and Perry had stricken the jury trial on reaching a settlement, AmFam

          correctly conceded at oral argument that it would have been left to the trial court’s discretion
          whether AmFam would have received a jury or a bench trial. Mount Vernon Dodge, Inc. v.
          Seattle-First Nat’l Bank, 18 Wn. App. 569, 581, 570 P.2d 702 (1977).

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          No. 83377-4-I/11

          contract between it and the settling parties. We disagree.

                We review a trial court’s order on summary judgment de novo. Boyd v.

          Sunflower Props., LLC, 197 Wn. App. 137, 142, 389 P.3d 626 (2016). If

          reasonable minds cannot differ as to whether language constitutes an offer,

          judgment is appropriate as a matter of law. See Swanson v. Liquid Air Corp.,

          118 Wn.2d 512, 522, 826 P.2d 664 (1992). Ordinarily, the legal effect of a

          document presents a question of law. Yeats v. Est. of Yeats, 90 Wn.2d 201, 204,

          580 P.2d 617 (1978).

                                                  A

                A covenant judgment is a form of settlement agreement that transfers the

          right of action against the defendant’s insurer in exchange for entry of judgment

          against the defendant and the plaintiff’s promise not to enforce that judgment

          against the defendant’s assets. Bird v. Best Plumbing Grp., LLC, 175 Wn.2d

          756, 764-65, 287 P.3d 551 (2012) (citing Besel v. Viking Ins. Co. of Wis., 146

          Wn.2d 730, 736-38, 49 P.3d 887 (2002)). A covenant judgment is binding on the

          insurer in the sense that the amount awarded in the covenant judgment is the

          presumptive measure of damages in any subsequent bad faith action against the

          insurer. Bird, 175 Wn.2d at 765.

                A covenant judgment creates a presumptive amount of damages not

          because it forms a contract with the insured, but because a tortfeasor should not

          be able to benefit from its wrongdoing. Greer v. Nw. Nat’l Ins. Co., 109 Wn.2d

          191, 204, 743 P.2d 1244 (1987). Covenant judgments are not entered for the

          benefit of the insurer and are not intended to release the insurer from any

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          No. 83377-4-I/12

          contractual obligations it owes to the insured. Kagele v. Aetna Life & Cas. Co.,

          40 Wn. App. 194, 198, 698 P.2d 90 (1985). Indeed, the purpose of covenant

          judgments is to protect the insured from the bad faith of his insurer, not to form

          an agreement with the insurer. Thus, the mere existence of a covenant judgment

          does not form a contract between the injured party and the tortfeasor’s insurer.

                                                   B

                 Nonetheless, AmFam avers that a contract was formed between it and the

          Garzas and Perry because paragraph 20 of the written memorialization of the

          settlement agreement constituted an offer that AmFam accepted by issuing a

          “blue sky” letter to Perry assuring him that it would pay any judgment entered

          against him that resulted from a trial even if the amount of the judgment

          exceeded the policy limits. We disagree.

                 For a contract to be formed, there must be both an offer and acceptance.

          Weiss v. Lonnquist, 153 Wn. App. 502, 511, 224 P.3d 787 (2009). “An offer

          consists of a promise to render a stated performance in exchange for a return

          promise being given.” Pac. Cascade Corp. v. Nimmer, 25 Wn. App. 552, 556,

          608 P.2d 266 (1980). “[A]n intention to do a thing is not a promise to do it.”

          Meissner v. Simpson Timber Co., 69 Wn.2d 949, 957, 421 P.2d 674 (1966). As

          we have previously explained:

                       “If from a promise, or manifestation of intention, or from the
                 circumstances existing at the time, the person to whom the promise
                 or manifestation is addressed knows or has reason to know that the
                 person making it does not intend it as an expression of his fixed
                 purpose until he has given a further expression of assent, he has
                 not made an offer.”

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          No. 83377-4-I/13

          Nimmer, 25 Wn. App. at 557 (quoting RESTATEMENT OF CONTRACTS § 25 (1932)).

                 Contracts—and by extension, purported offers—are to be read as a

          whole. Bellevue Square, LLC v. Whole Foods Mkt. Pac. Nw., Inc., 6 Wn. App. 2d

          709, 717, 432 P.3d 426 (2018). AmFam reads paragraph 20 in isolation, as if it

          were the only written words at issue. However, the Garzas did not send

          paragraph 20 to AmFam in isolation. Rather, as required by law, the Garzas sent

          AmFam a copy of the entire written settlement agreement between them and

          Perry.5

                 The written agreement, when read as a whole, makes it clear that it was

          intended to memorialize the agreement made solely between the Garzas and

          Perry. The first page of the document defines the parties as Brianna Garza,

          Mario Garza, and Matthew Perry. The settlement agreement also lays out its

          purposes and not once does it mention any intent to contract with or provide a

          benefit to the insurer:

                 The purposes of this Settlement Agreement are to (a) provide for a
                 settlement with prompt payment of the applicable insurance
                 proceeds and other sums to Plaintiffs for their medical,
                 rehabilitation and other needs, and to assure adequate
                 compensation for the harm they have sustained; (b) to protect
                 Defendant’s personal savings, property, assets, credit and
                 reputation from further judgments and verdicts in favor of Plaintiff;
                 (c) to afford protection to Defendant from having to make payments
                 and execution on judgments in excess of the insurance limits; and
                 (d) to minimize the costs, delays, stress and uncertainties of
                 continued litigation, to Defendant, his business interests, and to
                 Defendant’s family, and to Plaintiffs.

                 5 The Garzas were statutorily required to provide AmFam with a copy of the written

          settlement agreement. See RCW 4.22.060(1).

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          No. 83377-4-I/14

          The only mentions of Perry’s insurer outside of paragraph 20 concern the parties’

          intent to provide notice of the settlement and reasonableness hearing to the

          insurer.

                 Furthermore, the Garzas sent a copy of the written settlement agreement

          to AmFam as an attachment to an e-mail. Documents that are part of the same

          transaction or conveyance should be interpreted together. Boman v. Austin Co.,

          2 Wn. App. 581, 586, 469 P.2d 199 (1970). The body of the e-mail did, in fact,

          make an offer to AmFam, but not the offer that AmFam claims it accepted.

          Rather, the language of the offer was as follows:

                 Please tell American Family the following: if we are forced to litigate
                 this matter further, the floor value of this case will be $2.5M. With
                 the assigned bad faith, consumer protection act, and other claims,
                 the final value is much higher. My client wants resolution and
                 hereby makes the following offer to American Family: she will agree
                 to dismiss all potential claims arising from the crash, as well as her
                 claims pursuant to the settlement and covenant judgment, for
                 $2,500,000 if paid in full to my office within 10 business days (4:30
                 PM Pacific time on January 8, 2021).

          (Emphasis added.) Thus, the Garzas’ intent was clear: they intended to release

          the covenant judgment only if AmFam paid the Garzas $2.5 million, not if it made

          a promise to Perry to indemnify a jury verdict. Thus, read in context of all the

          writings supplied to AmFam in that e-mail and attachment, paragraph 20 plainly

          did not constitute an offer to AmFam that was capable of foisting on the Garzas

          and Perry an unwanted independent contract.

                 Even were we to read paragraph 20 in isolation (as AmFam urges us to

          do), those words would still not constitute an offer to AmFam. Paragraph 20

          provides that if, within 30 days, AmFam provided written proof to the parties of its

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          No. 83377-4-I/15

          intent “to fully indemnify defendant for any final judgment which may be entered

          against him for these claims, then the parties mutually release each other from all

          terms and conditions of this Settlement Agreement.” Notably, paragraph 20 does

          not say anything about resetting the matter for trial or reinstituting the present

          litigation. Nor does the paragraph promise anything to AmFam other than to

          provide it with the copy of the agreement as statutorily required. This paragraph

          of the agreement was simply a statement by the parties expressing their

          understanding of what would happen should it not be necessary to pursue a bad

          faith claim against AmFam. That AmFam, a stranger to the agreement, might

          ascribe a different meaning to it is wholly irrelevant.6

                                                           C

                  If there was any confusion as to the purpose and effect of paragraph 20,

          that was cleared up by the parties in their “Supplement to 12/23/2020 Settlement

          Agreement.” AmFam characterizes the “Supplement” as an attempt by the

          parties to create a new contract to escape their obligations to AmFam. This

          argument is without merit.

                  Contracts are not reformed; writings are. A & A Sign Co. v. Maughan, 419

          F.2d 1152, 1156 (9th Cir. 1969) (“Reformation is an appropriate remedy to

                  6 Furthermore, even if paragraph 20 did constitute an offer, AmFam did not accept it.    To
          form a valid contract, the terms of acceptance must be identical to the offer. Sea-Van Invs.
          Assocs. v. Hamilton, 125 Wn.2d 120, 126, 881 P.2d 1035 (1994). An “acceptance” that is
          conditional or otherwise alters the terms of the offer is considered a counter-offer, and no contract
          is formed unless the original offeror accepts the altered terms. Sea-Van, 125 Wn.2d at 126.
          Here, the letter issued by AmFam following its receipt of the settlement agreement qualified its
          purported acceptance by stating that “[t]he agreement to accept Paragraph 20 and waive the
          $250,000 limits of the Policy does not otherwise waive any duty or right under the Policy by Mr.
          Perry or American Family.” Because paragraph 20 contained no such limitation, AmFam’s letter
          was, at most, a counter-offer.

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          No. 83377-4-I/16

          correct a written instrument when the words it contains do not express the

          meaning the parties agreed upon.”). A written instrument may be reformed when,

          by mutual mistake of the parties, the writing fails to correctly express the parties’

          agreement. John Hancock Mut. Life Ins. Co. v. Agnew, 1 Wn.2d 165, 176, 95

          P.2d 386 (1939); accord W. Coast Pizza Co. v. United Nat’l Ins. Co., 166 Wn.

          App. 33, 41, 271 P.3d 894 (2011). Although reformation is most commonly

          thought of as an equitable remedy awardable by the court, the parties to a

          contract may voluntarily reform a written instrument to reflect their agreement

          without resort to litigation. See St. Paul Mercury Ins. Co. v. Foster, 268 F. Supp.

          2d 1035, 1043 (C.D. Ill. 2003) (collecting cases enforcing voluntary reformations).

                  This is precisely what occurred here.7 The “supplement” executed by the

          Garzas and Perry acknowledges that the mutual agreement of the parties was to

          fully and finally end the litigation between them and that they had unartfully

          included language in the writing memorializing their agreement that could be

          read as expressing a contrary intent. The Garzas and Perry then struck the

          writing’s paragraph 20 and replaced it with a paragraph that more accurately

          reflected their actual agreement, specifying that if AmFam agreed to pay the

          judgment deemed reasonable by the court, they would mutually release one

          another from all claims. This was a valid reformation executed by the parties to

          alter the writing (not to alter their contract), and is fully enforceable. As such, it

                  7 We include this explanation because our Supreme Court has made clear that a court’s

          “obligation to follow the law remains the same regardless of the arguments raised by the parties
          before it.” State v. Quismundo, 164 Wn.2d 499, 505-06, 192 P.3d 342 (2008).

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          did not negate any purported offer to AmFam. Accordingly, the trial court did not

          err by denying AmFam’s motion for summary judgment.

                                                   IV

                 AmFam last argues that the trial court abused its discretion by finding the

          covenant judgment agreed to between the Garzas and Perry to be reasonable

          and not the product of collusion. Again, we disagree.

                 Settlement contracts including covenant judgments entered into by the

          parties to a suit are subject to a determination of reasonableness by the trial

          court. RCW 4.22.060(1); Bird, 175 Wn.2d at 767. The burden of proving

          reasonableness is on the settling parties. RCW 4.22.060(1); Chaussee v. Md.

          Cas. Co., 60 Wn. App. 504, 510, 803 P.2d 1339, 812 P.2d 487 (1991). Once the

          court has determined that the covenant judgment is reasonable, the burden shifts

          to the insurer to show that it was a product of fraud or collusion. Besel, 146

          Wn.2d at 739.

                 Courts determine whether a covenant judgment is reasonable by

          examining what are known as the Glover/Chaussee factors. Those factors are

          as follows:

                 “‘[T]he releasing person’s damages; the merits of the releasing
                 person’s liability theory; the merits of the released person's defense
                 theory; the released person’s relative faults; the risks and expenses
                 of continued litigation; the released person’s ability to pay; any
                 evidence of bad faith, collusion, or fraud; the extent of the releasing
                 person's investigation and preparation of the case; and the interests
                 of the parties not being released.’”

          Besel, 146 Wn.2d at 738 (alteration in original) (quoting Glover v. Tacoma Gen.

          Hosp., 98 Wn.2d 708, 717-18, 658 P.2d 1230 (1983)). “No one factor controls

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          and the trial court has the discretion to weigh each case individually.”

          Chaussee, 60 Wn. App. at 512. “A trial court’s finding of reasonableness is a

          factual determination that will not be disturbed on appeal when supported by

          substantial evidence.” Brewer v. Fibreboard Corp., 127 Wn.2d 512, 524, 901

          P.2d 297 (1995). Substantial evidence is defined as “that ‘quantum of evidence

          sufficient to persuade a rational fair-minded person the premise is true.’” In re

          Dependency of A.M.F., 23 Wn. App. 2d 135, 141, 514 P.3d 755 (2022) (quoting

          Sunnyside Valley Irrig. Dist. v. Dickie, 149 Wn.2d 873, 879, 73 P.3d 369 (2003)).

                 Here, AmFam challenges the trial court’s findings on only two of the

          Glover/Chaussee factors: the releasing person’s damages and the lack of bad

          faith, collusion, or fraud.

                 First, AmFam asserts that the trial court’s finding on the releasing person’s

          damages is not supported by the evidence because Brianna’s damages do not

          justify an award of $2.5 million. In support of this argument, AmFam advances

          two contentions: first, that the trial court’s statements at the hearing indicate that

          there was no basis for the $2.5 million settlement amount and, second, that the

          Garzas’ litigation expert’s testimony was not credible.

                 AmFam’s first argument fails because a trial court’s oral statements,

          unless explicitly incorporated into its factual findings or order, are “no more than

          a verbal expression of his informal opinion at that time” and have “no final or

          binding effect.” Ferree v. Doric Co., 62 Wn.2d 561, 566-67, 383 P.2d 900 (1963).

          Any statement made by the trial court during its oral ruling “when at variance with

          the findings, cannot be used to impeach the findings or judgment.” Ferree, 62

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          Wn.2d at 567; see also Thompson v. Thompson, 9 Wn. App. 930, 934, 515 P.2d

          1004 (1973). Here, the trial court’s order did not incorporate any of its

          utterances. Thus, we assign no significance to the trial court’s utterances at the

          reasonableness hearing.

                 AmFam’s second argument also fails. This is so because we do not

          reassess the credibility of trial court witnesses. Substantial evidence review

          requires us to view the evidence in the light most favorable to the prevailing

          party, “‘a process that necessarily entails acceptance of the factfinder’s views

          regarding the credibility of witnesses.’” Freeburg v. City of Seattle, 71 Wn. App.

          367, 371-72, 859 P.2d 610 (1993) (quoting State ex rel. Lige & Wm. B. Dickson

          Co. v. County of Pierce, 65 Wn. App. 614, 618, 829 P.2d 217 (1992)). As such,

          “[t]he trial court’s credibility findings are not subject to review on appeal.” In re

          Marriage of DewBerry, 115 Wn. App. 351, 362, 62 P.3d 525 (2003). Because we

          cannot question the trial court’s determinations of credibility, AmFam’s argument

          is unavailing. In light of the trial court’s credibility determinations, its finding that

          $2.5 million was a reasonable estimate of Brianna’s damages is supported by

          substantial evidence.

                 Additionally, AmFam argues that the trial court’s finding of an absence of

          bad faith, collusion, or fraud as between the Garzas and Perry was not supported

          by substantial evidence and thus does not support the trial court’s determination

          of reasonableness. In so arguing, AmFam presents the evidence that it claims

          supports a finding of collusion, while ignoring the maxim that substantial

          evidence review “is ‘deferential and requires the court to view the evidence and

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          reasonable inferences in the light most favorable to the party who prevailed’

          below.” State v. Living Essentials, LLC, 8 Wn. App. 2d 1, 14, 436 P.3d 857

          (2019) (internal quotation marks omitted) (quoting Mansour v. King County, 131

          Wn. App. 255, 262-63, 128 P.3d 1241 (2006)).

                 When reviewing the evidence in the light most favorable to the Garzas and

          Perry, there is substantial evidence to support the trial court’s finding that the

          settlement was not the product of collusion. Trudell, the attorney Perry hired

          based on the advice of AmFam to seek independent counsel, had no affiliation

          with AmFam, the Garzas, or their respective attorneys. In his declaration, Trudell

          testified that he interviewed Perry about the collision and the current status of the

          litigation. Trudell declared that given the information he received from Perry, his

          conversation with Sullivan, and his own experience litigating TBI cases, he

          believed that $2.5 million was an accurate assessment of the value of the case.

          Trudell further declared that he reviewed the proposed covenant judgment and

          directed the Garzas’ attorney to remove a clause that would have awarded loss

          of consortium damages to Mario. Trudell stated the same to the trial court, and

          further stated that he would not have simply signed off on whatever number the

          Garzas’ attorney came up with. From this evidence, a reasonable person could

          conclude that the covenant judgment was not the product of collusion. The trial

          court did not abuse its discretion in finding the settlement agreement reasonable.

                                                    V

                 The Garzas request an award of attorney fees on appeal pursuant to the

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          Consumer Protection Act8 (CPA), Insurance Fair Conduct Act9 (IFCA), and

          Olympic Steamship.10 These authorities provide for the award of fees to a party

          that prevails on a claim for a CPA violation, an IFCA violation, or insurance bad

          faith, respectively. RCW 19.86.090; 48.30.015; Olympic S.S., 117 Wn.2d at 52.

          This matter involves no such claims. Accordingly, we decline to award fees to

          the Garzas.

                Affirmed.

          WE CONCUR:

                8 Ch. 19.86 RCW.
                9 Ch. 48.30 RCW.
                10 Olympic S.S. Co. v. Centennial Ins. Co., 117 Wn.2d 37, 811 P.2d 673 (1991).

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