Court Opinion

ID: 9918667
Source: CourtListenerOpinion
Date Created: 2024-01-16 15:01:05.042465+00
Date Added: 2024-06-11T08:04:22.906293
License: Public Domain

[DO NOT PUBLISH]
                              In the
         United States Court of Appeals
                   For the Eleventh Circuit

                    ____________________

                           No. 22-11988
                     Non-Argument Calendar
                    ____________________

CONNIE L. MORRIS,
                                               Plaintiﬀ-Appellant,
versus
BESSEMER CITY BOARD OF EDUCATION,

                                             Defendant-Appellee,

KEITH A. STEWARD,
individually and in his oﬃcial capacity as
Superintendent of the Bessemer Board
of Education,
2                      Opinion of the Court                22-11988

                                                         Defendant.

                     ____________________

           Appeal from the United States District Court
              for the Northern District of Alabama
              D.C. Docket No. 2:19-cv-01231-AMM
                    ____________________

Before JORDAN, JILL PRYOR, and BRANCH, Circuit Judges.
PER CURIAM:
       Connie Morris appeals from the dismissal of her lawsuit fol-
lowing the district court’s order granting a motion to enforce a set-
tlement agreement. Ms. Morris argues that the district court mis-
applied Alabama contract law when it found that the parties had an
enforceable contract. Upon review, we agree with Ms. Morris and
reverse.
                                  I
        On August 1, 2019, Ms. Morris ﬁled a complaint against her
employer, the Bessemer City Board of Education, and Keith Stew-
ard, the Superintendent of the Bessemer Board of Education, al-
leging claims of age and gender discrimination and a claim for a
violation of a right to a due process hearing. Both defendants
moved for summary judgment. The district court granted Super-
intendent Steward’s motion and dismissed him from the case. The
district court granted the Board’s motion in part and ordered Ms.
Morris and the Board to mediation. The parties attended
22-11988              Opinion of the Court                        3

mediation on February 9, 2022, where they agreed to settle the
matter. To that end, the terms of a “settlement proposal” were set
forth in a document the parties labeled a “Memorandum of Under-
standing.” The Memorandum provided, in part, as follows:
      The settlement proposal contemplated in this memo-
      randum of understanding will be subject to a majority
      vote of the Board of Education.
      For a 24-month period beginning on July 1, 2022,
      Plaintiff will be paid at Step 27 of the director pay
      scale. During this period, Plaintiff will receive any
      raises and bonuses applicable to other employees at
      her position on the pay scale and will continue to
      accrue vacation and sick leave. . . .At the end of this
      period, Plaintiff’s employment will terminate,
      through her retirement or otherwise. Defendant shall
      have no obligation to employ or re-employ Plaintiff
      thereafter. Plaintiff will be able to redeem unused
      vacation pay at the end of the period.
      The parties’ fuller agreement incorporating these and
      more detailed terms will include a mutual
      nondisparagement clause, a comprehensive release of
      all claims, a no admission of liability clause, and other
      terms and provisions ordinarily included in a
      comprehensive settlement and release.
D.E. 125-1 at 1. Ms. Morris and at least one representative for the
Board signed the Memorandum.
      A few days after mediation, Ms. Morris decided that she no
longer wanted to end her employment in the manner set forth in
4                     Opinion of the Court                22-11988

the Memorandum. On February 14, 2022, counsel for Ms. Morris
informed the Board’s counsel of Ms. Morris’ decision. The next
day, on February 15, 2022, the Board voted to approve the terms set
forth in the Memorandum. On February 21, 2022, the Board ﬁled
a motion to enforce a settlement agreement. Ms. Morris opposed
the motion.
       The district court granted the Board’s motion, concluding
that the Memorandum constituted a valid, enforceable contract
from which Ms. Morris could not withdraw. The Memorandum,
the district court explained, was subject only to the Board’s ap-
proval—not Ms. Morris’ second thoughts, and if the parties in-
tended to make the settlement “also subject to a revocation option
for” Ms. Morris, they would have done so. The district conse-
quently granted the Board’s motion and dismissed Ms. Morris’ suit
with prejudice. Ms. Morris timely appealed.
        On appeal, Ms. Morris argues that the district court wrong-
fully concluded that the memorandum constituted an enforceable
contract. According to Ms. Morris, the Memorandum simply re-
ﬂected the terms of an oﬀer to settle, which she was free to with-
draw at any time before the Board voted because the representa-
tives who signed the Memorandum had no authority to bind the
Board to the terms set forth therein. Although the Board agrees
that its representatives had no authority to execute a binding con-
tract, it argues that it subsequently ratiﬁed the agreement when it
voted on February 15, 2022.
                                II
22-11988                Opinion of the Court                            5

        We review a district court’s order enforcing a settlement
agreement for an abuse of discretion. Hayes v. Nat’l Serv. Indus., 196
F.3d 1252, 1254 (11th Cir. 1990). The construction and enforceabil-
ity of a settlement agreement is governed by state law. See id. And
we review the interpretation of a settlement agreement de novo. See
Managed Care Advisory Group, LLC v. CIGNA Healthcare, Inc., 939
F.3d 1145, 1153 (11th Cir. 2019). See also Resnick v. Uccello Immo-
bilien GMBH, Inc., 227 F.3d 1347, 1350 (11th Cir. 2000) (“Principles
governing general contract law apply to interpret settlement agree-
ments.”).
                                   III
       Settlement agreements are contracts and are thus subject to
traditional principles of formation and enforcement of contracts.
See Norfolk S. Corp. v. Chevron, U.S.A., Inc., 371 F.3d 1285, 1290 (11th
Cir. 2004) (citation omitted). The parties agree that Alabama law
governs the construction and enforcement of the Memorandum at
issue here.
          “No contract is formed without an offer, an acceptance,
consideration, and mutual assent to terms essential to the con-
tract.” Steiger v. Huntsville City Bd. of Educ., 653 So. 2d 975, 978 (Ala.
1995). See also Mantiply v. Mantiply, 951 So. 2d 638, 656 (Ala. 2006)
(same). Generally speaking, the acceptance of an offer is valid only
if it is done by one with authority to accept the offer, or if it is rati-
fied before the offer is revoked. See Restatement (Second) of Con-
tracts § 52 cmt. c (1981) (“Even an acceptance by a purported agent,
acting without agency power, may in appropriate cases be ratified
6                      Opinion of the Court                 22-11988

by the offeree. Ratification must occur, however, before the offeror
manifests withdrawal from the transaction and before the termina-
tion of the offeree’s power of acceptance.”).
        The parties agree that, despite their signatures on the Mem-
orandum, the Board’s representatives had no authority to accept
the “settlement proposal” or bind the Board to the terms set forth
in the Memorandum. Only a majority of the Board, after a public
vote, could accept and bind the Board to the terms set forth in the
Memorandum. See Ala. Code § 36-25A-5(b). The Board, however,
argues that this crucial defect should be ignored because the Board
“ratified” the agreement a few short days after mediation. The
problem with this argument is that any so-called ratification oc-
curred after Ms. Morris informed the Board that she was no longer
interested in settling the matter according to the terms set forth in
the Memorandum.
       It is a basic tenet of Alabama contract law that no contract is
formed without an offer and an acceptance. It is also well-estab-
lished that revocation of an offer terminates the power of ac-
ceptance. The Board could not accept the terms of the proposed
agreement (the Memorandum) until a public vote occurred. And
Ms. Morris communicated her revocation before the Board voted.
Consequently, there was no contract on the table to accept when
the Board voted. See Shoals Community College v. Colagross, 674 So.
2d 1311, 1315 (Ala. Civ. App. 1995) (“[W]e note that all of the drafts
of the ‘settlement agreement’ contain a specific provision stating
that the agreement is ‘subject to the approval of Attorney General
22-11988               Opinion of the Court                         7

James Evans.’ However, the record is devoid of any evidence that
Attorney General Evans approved the agreement. Based on the
foregoing reasons, it appears that there was no valid ‘settlement
agreement’ for the trial court to enforce.”); DeWitt v. Gainous, 601
So. 2d 103, 105 (Ala. Civ. App. 1992) (“A prospective resignation
that is not unconditionally accepted may be withdrawn prior to its
effective date. Here, Gainous’s acceptance of DeWitt’s resignation
could be effective only if the Board gave its final approval. By sub-
mitting his letter of rescission prior to the Board’s October 25 meet-
ing, DeWitt successfully withdrew his resignation before its uncon-
ditional acceptance.”).
       While it is true that settlement agreements are favored and
will be summarily enforced, “the parties must first enter into a valid
and binding settlement agreement before it will be enforced.” Sag-
amore Ins. Co. v. Sudduth, 45 So. 3d 1286, 1290 (Ala. Civ. App. 2010)
(quoting Mays v. Julian LeCraw & Co., 807 So. 2d 551, 554 (Ala. Civ.
App. 2001)). Because there was no acceptance before Ms. Morris’
revocation, there was no valid and binding settlement agreement.
                                     IV
       For the reasons set forth above, we reverse and remand for
further proceedings consistent with this opinion.
      REVERSED AND REMANDED.