Court Opinion

ID: 2716519
Source: CourtListenerOpinion
Date Created: 2014-08-08 18:03:05.516295+00
Date Added: 2024-06-11T12:54:03.900782
License: Public Domain

IN THE
            ARIZONA COURT OF APPEALS
                        DIVISION TWO

    DON C. ROBERTSON, AS SUCCESSOR TRUSTEE OF THE VIOLA I.
ROBERTSON TRUST DATED OCTOBER 1, 2009; CHARLOTTE G. HARDY AS
   SUCCESSOR TRUSTEE OF THE VIOLA I. ROBERTSON TRUST DATED
  OCTOBER 1, 2009; JAMES H. HARDY AND CHARLOTTE G. HARDY,
HUSBAND AND WIFE; BONITA SUE ESCOBEDO AND JAMES D. SUMPTER,
   AS SUCCESSOR TRUSTEES OF THE SUMPTER TRUST; W. MICHAEL
  ADDINGTON AND CHERYL ADDINGTON, HUSBAND AND WIFE AND
  TRUSTEES OF THE W. MICHAEL AND CHERYL ADDINGTON TRUST,
                      Plaintiffs/Appellees,

                              v.

ROBERT E. ALLING AND JACQUELINE R. ALLING, INDIVIDUALLY AND AS
   HUSBAND AND WIFE; MELISSA L. MOORE, INDIVIDUALLY; DOYLE K.
 WARNER AND DEANNA K. WARNER, INDIVIDUALLY AND AS HUSBAND
AND WIFE; HARRY L. VIEZENS AND MARCIA L. VIEZENS, INDIVIDUALLY
 AND AS HUSBAND AND WIFE AND AS TRUSTEES OF THE VIEZENS TRUST;
FREDERICK AND CALISTA WASHBURN, INDIVIDUALLY AND AS HUSBAND
AND WIFE; MGF FUNDING, INC., AN ARIZONA CORPORATION; BRIAN A.
     MORTENSEN AND OXANA MORTENSEN, INDIVIDUALLY AND AS
      HUSBAND AND WIFE; ROBERT R. HICKS AND NICOLE HICKS,
 INDIVIDUALLY AND AS HUSBAND AND WIFE; KARL F. KOHLHOFF AND
 JOAN M. KOHLHOFF, INDIVIDUALLY AND AS HUSBAND AND WIFE AND
      AS TRUSTEES OF THE KOHLHOFF FAMILY TRUST; WILLIAM D.
    LAWRENCE, INDIVIDUALLY; LAWRENCE PROPERTIES, A GENERAL
  PARTNERSHIP; WILLIAM GLAUNSINGER AND LORNA GLAUNSINGER,
  INDIVIDUALLY AND AS HUSBAND AND WIFE; THOMAS GRAHAM AND
     REGINA GRAHAM, INDIVIDUALLY AND AS HUSBAND AND WIFE;
   GRAHAM HOMES, LLC, AN ARIZONA LIMITED LIABILITY COMPANY;
GERALD L. GRAHAM, INDIVIDUALLY AND AS TRUSTEE OF THE GRAHAM
           FAMILY TRUST, AND VELMA GRAHAM, HIS WIFE,
                       Defendants/Appellants.
               ROBERTSON, ET AL. v. ALLING, ET AL.
                      Opinion of the Court

                        No. 2 CA-CV 2013-0148
                         Filed August 5, 2014

             Appeal from the Superior Court in Gila County
                           No. CV201100165
                 The Honorable Peter J. Cahill, Judge

 REVERSED AND REMANDED IN PART; VACATED IN PART

                              COUNSEL

Grasso Law Firm, P.C., Chandler
By Robert Grasso, Jr. and Jenny J. Winkler
Counsel for Plaintiffs/Appellees

Clark Hill PLC, Scottsdale
By Russell A. Kolsrud and Mark S. Sifferman
Counsel for Defendants/Appellants

                              OPINION

Judge Howard authored the opinion of the Court, in which Judge
Vásquez and Judge Miller concurred.

H O W A R D, Judge:

¶1           Appellants, collectively “the Allings,” appeal from the
trial court’s grant of a motion to enforce settlement in favor of
Appellees, collectively “the Robertsons.”1 On appeal, the Allings
argue that the trial court erred in concluding their attorney had
authority to settle the matter, that Rule 80(d), Ariz. R. Civ. P., was

      1For brevity, we refer to the appellants and appellees by the
last name of the first party from each group.

                                  2
             ROBERTSON, ET AL. v. ALLING, ET AL.
                    Opinion of the Court

inapplicable, and that material facts of the agreement were not in
dispute. Because we conclude reasonable minds could differ about
whether the Allings’ counsel had apparent authority to settle the
case based on the undisputed facts presented, and whether Rule
80(d) applies, we reverse in part, vacate in part, and remand for
further proceedings.

                Factual and Procedural Background

¶2           We view the facts in the light most favorable to the
Allings, the nonmoving party on the motion to enforce the
settlement. See Canyon Contracting Co. v. Tohono O’Odham Hous.
Auth., 172 Ariz. 389, 390, 837 P.2d 750, 751 (App. 1992) (summary
judgment standard of review applies to grant of motion to enforce
settlement). In 2011, the Robertsons sued the Allings to quiet title,
for a prescriptive easement, and for a permanent injunction
regarding the Allings’ real property through which a diversion ditch
and water pipe drew water from Bonita Creek to the Robertsons’
properties. Pretrial litigation continued until January 29, 2013, when
the parties attended a settlement conference. The Robertsons
expressly conditioned attending the settlement conference on all of
the Allings’ presence, and all of the Allings or their representatives
with settlement authority were present. Although the parties did
not reach a settlement agreement at the conference, the Allings and
their counsel agreed, through the mediator, to leave its last
conveyed settlement offer open for an additional forty-eight hours.
That offer expired on January 31 without an acceptance from the
Robertsons.

¶3           The Allings’ counsel sent an e-mail to the Allings on
February 2 recommending that, although their offer had expired,
they leave the offer open until he had a further opportunity to speak
with opposing counsel. On February 4, however, five of the twenty-
seven Allings e-mailed their counsel, telling him they no longer
wished to settle with the terms they had offered at the settlement
conference. The Allings’ counsel received the e-mail and “may have
seen it” but “did not read it.” Thus, on February 6 when asked by
the Robertsons’ counsel on the telephone, the Allings’ counsel stated
that “the offer was still open for acceptance.”

                                  3
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

¶4           The Robertsons’ counsel e-mailed the Allings’ counsel
after their phone conversation to confirm that the offer was still
open and listed the terms of the offered settlement. The Allings’
counsel responded simply, “Confirmed.” On February 8, the
Robertsons’ counsel e-mailed and faxed the Allings’ counsel the
Robertsons’ acceptance of the offer. The Robertsons’ counsel filed a
notice of case resolution with the trial court, which was distributed
to counsel for all parties, and the court vacated the April trial date.

¶5           Several weeks later, the Allings’ counsel responded to
the acceptance and inquiries from opposing counsel regarding draft
settlement documentation with a “counter-draft” and explained that
some of the Allings had been disputing his settlement authority.
The Robertsons then filed the motion to enforce the settlement.
After oral argument, but without an evidentiary hearing, the trial
court ruled that the February 6 e-mail exchange constituted a
reoffering of the first offer from the Allings, and granted the motion
to the extent necessary to enforce the settlement described in that
exchange.

¶6            In its conclusions of law filed after the hearing, the court
determined that the attempted revocation of authority was
ineffective, and therefore the Allings’ counsel had both the actual
and apparent authority of his clients to settle the matter. Thus, the
court concluded the settlement was enforceable against the Allings
and the Allings were estopped to claim otherwise. It also concluded
Rule 80(d) did not apply or was satisfied by an e-mail exchange
between counsel on February 6 and 8. We have jurisdiction over the
Allings’ appeal pursuant to A.R.S. §§ 12-120.21(A)(1) and 12-
2101(A)(1).

                         Standard of Review

¶7         Regarding the Rule 80(d) arguments of the parties, 2 we
review de novo the interpretation and application of court rules.

      2Rule  80(d) states: “No agreement or consent between parties
or attorneys in any matter is binding if disputed, unless it is in
writing, or made orally in open court, and entered in the minutes.”

                                    4
             ROBERTSON, ET AL. v. ALLING, ET AL.
                    Opinion of the Court

Haroutunian v. ValueOptions, Inc., 218 Ariz. 541, ¶ 22, 189 P.3d 1114,
1122 (App. 2008). We review the grant of a motion to enforce a
settlement using the same standards as for summary judgment.
Canyon Contracting, 172 Ariz. at 390, 837 P.2d at 751. Under that
standard, we determine de novo whether the trial court correctly
applied the law and whether any genuine disputes exist as to any
material fact. See Dayka & Hackett, LLC v. Del Monte Fresh Produce
N.A., 228 Ariz. 533, ¶ 6, 269 P.3d 709, 712 (App. 2012). The trial
court should grant summary judgment when “the moving party
shows that there is no genuine dispute as to any material fact and
the moving party is entitled to judgment as a matter of law.” Ariz. R.
Civ. P. 56(a). Summary judgment is inappropriate, however, where
“conflicting inferences are possible” from the undisputed facts.
Orme Sch. v. Reeves, 166 Ariz. 301, 308, 309, 802 P.2d 1000, 1007, 1008
(1990).

¶8           The Robertsons, however, claim this court is bound by
the trial court’s findings of fact under Rule 52(a), Ariz. R. Civ. P.,
unless they are clearly erroneous. But Rule 52(a) applies “[i]n all
actions tried upon the facts without a jury or with an advisory jury.”
The trial court here did not conduct a trial, but an oral argument.
And, under Canyon Contracting, the summary judgment standard
applies.3 172 Ariz. at 390, 837 P.2d at 751.

¶9           The Robertsons further assert the Allings failed to
identify any facts in dispute and never requested the trial court to
take evidence. But the Allings do identify a factual dispute
concerning apparent authority in their brief and, at the hearing
below, specifically told the trial court, “This is akin to a motion for
summary judgment proceeding where there are so many issues of
fact. There are disputed issues of fact, there are verbal things that
the parties disagree about.” Accordingly, we review the arguments

      3At oral argument, the Robertsons cited Reed v. Reed, 154 Ariz.
101, 740 P.2d 963 (App. 1987), in support of their position. But Reed
requires “an[] adversarial hearing or proceeding at which the trial
court hears evidence and resolves disputed factual issues” before
Rule 52 applies. Id. at 103, 740 P.2d at 965. No such hearing
occurred here.

                                  5
             ROBERTSON, ET AL. v. ALLING, ET AL.
                    Opinion of the Court

on appeal as though the court’s ruling was one granting summary
judgment, despite language in the court’s ruling to the contrary. See
John Munic Enters., Inc. v. Laos, 235 Ariz. 12, ¶ 9, 326 P.3d 279, 283
(App. 2014) (“[C]ourts look to substance not labels.”).

                 Summary of Rule 80(d) Decision

¶10          Due to the intertwined nature of the requirements of
Rule 80(d) and the determination of apparent authority, we
summarize our analysis of that issue before proceeding. We
conclude that a genuine dispute of material fact exists concerning
the Allings’ attorney’s authority to extend the time for the
Robertsons to accept the settlement offer and prevented the entry of
summary judgment. That conclusion normally would require us to
vacate the summary judgment and remand the case for trial or
evidentiary hearing on the disputed factual issue or other
proceedings. But we further conclude that the genuine dispute of
fact means the agreement is “in dispute” and makes Rule 80(d)
applicable. Because the Allings’ assent to the contract is not in
writing, the requirements of Rule 80(d) were not met, and the
agreement is unenforceable as a matter of law. See Canyon
Contracting, 172 Ariz. at 392-93, 837 P.2d at 753-54. This conclusion
requires reversing the judgment in favor of the Robertsons on that
issue and not a remand for proceedings on the issue of the Allings’
counsel’s authority. We explain these conclusions below, analyzing
the issue of the Allings’ attorney’s authority within the context of
Rule 80(d).

               Settlement Authority and Rule 80(d)

¶11          The Allings first argue their attorney had no actual or
apparent authority to settle the case, and the trial court erred in
concluding otherwise and enforcing the settlement. The Allings also
argue that because the requirements of Rule 80(d) were not met, the
settlement agreement is unenforceable as a matter of law, and the
court erred in finding the rule inapplicable. The Robertsons contend
that the Allings’ attorney had either actual or apparent authority,
and that neither the existence nor terms of the agreement are in
dispute, only its enforceability, and therefore Rule 80(d) is
inapplicable.

                                  6
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

Applicability of Rule 80(d)

¶12           Rule 80(d) provides that “[n]o agreement or consent
between parties or attorneys in any matter is binding if disputed,
unless it is in writing, or made orally in open court, and entered in
the minutes.” The rule applies to settlement agreements. Canyon
Contracting, 172 Ariz. at 391, 837 P.2d at 752. But where “the
existence of the settlement agreement and its terms are not in
dispute,” the rule does not apply. Hays v. Fischer, 161 Ariz. 159, 166,
777 P.2d 222, 229 (App. 1989). We therefore determine first whether
Rule 80(d) applies.

¶13          In Canyon Contracting, in determining whether an
agreement was “disputed” and therefore whether Rule 80(d)
applied, our examination included whether a genuine dispute of
material fact existed regarding the attorney’s authority to settle the
case. 172 Ariz. at 392, 837 P.2d at 753. Because we concluded a
factual dispute existed, we determined that Rule 80(d) applied. Id.

¶14          We further determined that where the attorney’s
settlement authority was subject to a genuine dispute of material
fact, Rule 80(d) required the writings to include the written assent of
the principal. Id. at 393, 837 P.2d at 754. We reasoned that “[i]n
order to effectuate Rule 80(d)’s policy of avoiding difficult issues of
proof in the context of enforcing settlement agreements, we hold
that the manifestation of assent, as well as the terms of the
agreement, must be in writing.”4 Id. Because one party’s assent to

      4Although   the plain language of Rule 80(d) does not require
the assent to be in writing, see Fragoso v. Fell, 210 Ariz. 427, ¶ 7, 111
P.3d 1027, 1030 (App. 2005) (we usually look to plain language of
rule to determine intent of drafters), in Canyon Contracting this court
interpreted the rule to include this requirement. We only overturn
long-standing precedent for compelling reasons. Young v. Beck, 227
Ariz. 1, ¶ 22, 251 P.3d 380, 385 (2011). Even though the burden is
lower with regard to court rules, see Wells v. Fell, 231 Ariz. 525, ¶ 11,
297 P.3d 931, 934 (App. 2013), the Robertsons have not argued we
should disagree with Canyon Contracting, no compelling reason
appears to overturn Canyon Contracting, and we decline to do so.

                                   7
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

the terms was not in writing, we reversed the trial court’s judgment
and remanded for further proceedings. Id.

¶15           Rule 80(d) thus requires an actual “dispute,” and the
party relying on Rule 80(d) must show at least a genuine dispute of
material fact concerning the agreement or the lawyer’s authority to
bind the party in the settlement of a lawsuit.5 Id. at 392, 837 P.2d at
753. The rule then specifies the procedure for proving an agreement
affecting litigation by requiring the agreement or consent and the
manifestation of assent to the agreement to be in writing; where the
attorney’s authority is disputed, the assent must come from the
principal directly. Id. at 393, 837 P.2d at 754; Rule 80(d). We
therefore determine next whether the Allings have raised a genuine
dispute concerning their attorney’s authority.

Attorneys’ Settlement Authority

¶16           In Arizona, an attorney’s authority to bind a client to a
settlement agreement has two governing principles. First, as a
general rule, lawyers have no inherent or implied authority to settle
a case. United Liquor Co. v. Stephenson, 84 Ariz. 1, 3, 322 P.2d 886, 887
(1958); Restatement (Third) of the Law Governing Lawyers § 22
(2000) (hereinafter “Lawyers”). Thus, ordinarily the attorney may
not settle or compromise a claim “without the client’s express, actual
authorization.” Garn v. Garn, 155 Ariz. 156, 160-61, 745 P.2d 604,
608-09 (App. 1987). Clients remain free to revoke their attorney’s
settlement authority at any time. Lawyers § 22(3) & cmt. c. Clients
are bound, however, “by a settlement reached by [their attorney]
before revocation.” Lawyers § 22 cmt. c.

¶17         Second, despite the general rule, principles of agency
law also govern the attorney-client relationship, and the actions of
the client may alter the general rule. See Panzino v. City of Phoenix,
196 Ariz. 442, ¶ 17, 999 P.2d 198, 203 (2000). Thus, “if the client
places the attorney in a position where third persons of ordinary

      5Because  Rule 80(d) is contained in the Arizona Rules of Civil
Procedure, it applies only to “suits,” see Ariz. R. Civ. P. 1, and is
limited to agreements or consents in litigation.

                                   8
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

prudence and discretion would be justified in assuming the attorney
was acting within his authority, then the client is bound by the acts
of the attorney within the scope of his apparent authority.” Ariz.
Title Ins. & Trust Co. v. Pace, 8 Ariz. App. 269, 271-72, 445 P.2d 471,
473-74 (1968).      Once cloaked with apparent authority, “the
termination of the lawyer’s [actual] authority does not terminate his
apparent authority as to third parties, i.e., adverse litigants.”
Panzino, 196 Ariz. 442, ¶ 17, 999 P.2d at 203; see also Restatement
(Third) of Agency § 3.11 cmt. c (2006) (hereinafter “Agency”) (“Once
such a manifestation has been made, it remains operative
independent of manifestations as between principal and agent that
terminate actual authority.”).

¶18            When an attorney acts within the apparent scope of his
authority, those acts “are binding on the principal as against a third
party who had formerly dealt with the principal through the agent
and who had no notice of the revocation, because such a third party
is justified in assuming the continuance of the agency relationship.”
Panzino, 196 Ariz. 442, ¶ 17 n.5, 999 P.2d at 203 n.5; see also Scott v.
Randle, 697 N.E.2d 60, 67 (Ind. Ct. App. 1998) (attorney may have
apparent authority to finalize settlement negotiations during
litigation where client places attorney “in the position of sole
negotiator on his behalf”); Nelson v. Consumers Power Co., 497
N.W.2d 205, 208-09 (Mich. Ct. App. 1993) (attorney has apparent
authority to bind client to settlement, and agreement binding if
made in writing and signed by attorney); Kaiser Found. Health Plan of
the Nw. v. Doe, 903 P.2d 375, 379 (Or. Ct. App. 1995) (attorneys can
bind clients to settlement when cloaked in apparent authority).

¶19           Apparent authority is established by conduct of the
principal that leads the third party to conclude the agent has
authority. Canyon Contracting, 172 Ariz. at 392, 837 P.2d at 753. The
third party’s reliance on this apparent authority still must be
reasonable in order to bind the principal to the agent’s acts. Miller v.
Mason-McDuffie Co. of S. Cal., 153 Ariz. 585, 590, 739 P.2d 806, 811
(1987). Thus, whether apparent authority exists is an issue of fact.
Hays, 161 Ariz. at 163, 777 P.2d at 226. Agency § 3.11 cmt. c explains
that it is not reasonable to assume the agent has authority when the

                                   9
             ROBERTSON, ET AL. v. ALLING, ET AL.
                    Opinion of the Court

“agent’s authority was limited in duration or to a specific
undertaking.”

¶20           In Canyon Contracting, we applied these principles to
determine whether an alleged settlement was enforceable. In that
case, an attorney and principal appeared together at a settlement
conference, but the parties later disputed whether a settlement was
reached, and the correspondence after the conference supported
conflicting inferences about the existence of the alleged settlement
agreement. 172 Ariz. at 392, 837 P.2d at 753. Based on those facts,
we concluded “[n]othing in the record presently before us compels a
finding that [the attorney] had apparent authority to settle the case
or that [the third party] reasonably relied upon such authority.” Id.
Additionally, we concluded “reasonable minds could differ
regarding the effect of [the principal]’s mere presence at that
[settlement] conference and his subsequent failure to notify [the
third party] directly that he had rejected the proposed terms.” Id.
We therefore found the effective grant of summary judgment on the
issue inappropriate and reversed and remanded for further
proceedings. Id. at 393, 837 P.2d at 754.

Actual Authority in this Case

¶21           The Allings’ and their counsel appeared together at the
settlement conference. No settlement was reached. Some of the
Allings revoked their attorney’s authority on February 4 in an e-mail
that he received but did not read. That revocation effectively
terminated his actual authority. See Agency § 1.04(4) (person has
notice of fact if person has reason to know fact or should know fact
to fulfill duty owed to another person); E.R. 1.4 & cmt. 2, Ariz. R.
Prof’l Conduct, Ariz. R. Sup. Ct. 42 (attorney has duty of reasonable
communication with client, particularly respecting settlement).
Accordingly, the Allings’ counsel had no actual authority and his
clients were not bound by the settlement on that basis. See Garn, 155
Ariz. at 160-61, 745 P.2d at 608-09. The court erred in concluding
otherwise.

¶22          The Robertsons argue, however, this notice was
ineffective to terminate the Allings’ counsel’s actual authority
because the Allings’ counsel did not read the e-mail. The argument

                                 10
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

is without merit, and none of the authorities the Robertsons cite
supports the proposition that an attorney who has received a client
communication but does not read it through neglect or inattention
may somehow avoid the legal consequences of the communication
with respect to his client. See Casey v. Ill. Cent. Gulf R.R., 687 F. Supp.
1112, 1115 (W.D. Ky. 1988) (because defendant bore risk of mistaken
factual assumption to settlement agreement, settlement enforceable
against defendant); Panzino, 196 Ariz. 442, ¶ 17 & n.5, 999 P.2d at 203
& n.5 (termination of lawyer’s actual authority does not terminate
apparent authority to third parties); Restatement (Second) of Agency
§ 124A (1958) (termination of actual authority does not terminate
apparent authority); Id. § 125 (conditions under which apparent
authority ends as to third parties); Restatement (Second) of
Contracts § 154 (1981) (hereinafter “Contracts”) (circumstances
under which party bears risk of mistake of fact); Lawyers § 27 cmt. d
illus. 3 (lawyer who fails to disclose lack of settlement authority at
conference cannot bind client to settlement).

¶23           The Robertsons also appear to argue that even if some
of the Allings effectively revoked their counsel’s authority, the
remaining Allings were bound by the settlement. But, as the Allings
pointed out at oral argument, although the other clients did not
explicitly revoke their attorney’s authority, they did not extend it
either. And the Robertsons offer no authority for the proposition
that where an attorney represents a group of parties in a matter, and
a significant number of them revoke authority to offer a settlement
that purports to provide global resolution of the litigation, the
attorney’s conduct still may bind the clients who did not revoke his
authority. We therefore do not consider the argument further. See
Ariz. R. Civ. App. P. 13(a)(6) (brief shall contain argument with
citations to authorities and statutes relied on); Ness v. W. Sec. Life Ins.
Co., 174 Ariz. 497, 503, 851 P.2d 122, 128 (App. 1992) (“Arguments
unsupported by any authority will not be considered on appeal.”).

¶24            The Robertsons further argue, for the first time on
appeal, that no deadline was included in the offer, either because a
deadline was not a material term or because it was not stated in the
offer itself, and therefore their acceptance constituted a counter-offer
that the Allings accepted through silence. But they stipulated at oral

                                    11
             ROBERTSON, ET AL. v. ALLING, ET AL.
                    Opinion of the Court

argument below that the parties agreed to the forty-eight hour
deadline ending January 31, 2013 at 5:00 p.m., and thus the deadline
was an explicit term of the offer made at the settlement conference.
They cannot change their position now. See Black v. Perkins, 163
Ariz. 292, 293, 787 P.2d 1088, 1089 (App. 1989) (“When a party by
pleading or stipulation has agreed to a certain set of facts, he may
not contradict them.”). Thus, once the deadline passed, they could
no longer accept that offer. Contracts § 41(1). To the extent they
argue the deadline was not a material term and therefore was not
binding, they offer no authority to support that argument. See Ariz.
R. Civ. App. P. 13(a)(6); Ness, 174 Ariz. at 503, 851 P.2d at 128.

¶25           We therefore also reject the Robertsons’ argument that
even if the offer expired, the Robertsons’ later acceptance constituted
a counter-offer that the Allings accepted through silence. As the
trial court correctly concluded at the hearing, the original offer
lapsed, the Allings’ counsel re-offered it, and the Robertsons
accepted the “new” offer. Because the Robertsons’ acceptance was
in response to the new offer, their acceptance was not a counter-offer
after a lapsed offer. Nor does this factual situation suggest that the
Allings had a duty to reply or be deemed to have accepted. Cf.
Swingle v. Myerson, 19 Ariz. App. 607, 609, 509 P.2d 738, 740 (1973)
(where offeree takes benefit of services under circumstances
indicating compensation expected, offeree can accept offer by
silence). Accordingly, the authority the Robertsons cite for their
argument on manifestation of assent to a counter-offer through
silence is inapposite.

Apparent Authority in this Case

¶26          The Robertsons additionally argue the trial court
correctly concluded the Allings’ counsel had apparent authority,
and absent notice from the Allings to the Robertsons of the
revocation, the Allings still were bound to the settlement by their
counsel’s actions. The court reached this conclusion as a matter of
law, based on the facts presented in the record. We therefore review
its conclusion de novo. See Dayka & Hackett, LLC, 228 Ariz. 533, ¶ 6,
269 P.3d at 712.

                                  12
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

¶27          Although close, we conclude that by viewing the
underlying facts in the light most favorable to the Allings, as we
must, this case is analogous to the facts of Canyon Contracting and
that reasonable minds could draw different inferences from the
undisputed facts. 172 Ariz. at 390, 837 P.2d at 751. The Allings and
their counsel attended the settlement conference together, as in
Canyon Contracting, and reasonable minds could differ on the effect
of the Allings’ presence there. The record does not show whether
the Allings’ counsel conducted the negotiations for his clients or
they participated directly with the mediator.             Indeed, the
Robertsons’ insistence that the Allings actually attend the conference
in person could indicate the Robertsons did not think the Allings’
counsel had unlimited, or any, settlement authority before the
conference, and the Robertsons do not explain what happened
during the conference that changed their understanding of the
Allings’ counsel’s authority.

¶28           The parties’ mutual agreement, albeit at the Robertsons’
suggestion, to place a forty-eight hour window on accepting the
offer further supports that inference. Once that time period lapsed,
the Allings were no longer present, and the settlement conference
was over, one could reasonably conclude that some new
manifestation from the Allings would be required before the
Allings’ counsel would have apparent authority to make or accept
any other offer. See Garn, 155 Ariz. at 160-61, 745 P.2d at 608-09 (by
default, attorneys have no inherent or implied authority to settle); see
also Contracts § 41(1) (offeree’s power of acceptance terminates at
time specified in offer).

¶29          Nevertheless, competing inferences exist regarding the
Allings’ counsel’s authority. The Allings were present at the
settlement conference and although the record does not indicate
whether their counsel or the Allings negotiated with the mediator,
the Allings ultimately allowed their counsel to work out the details
of the initial offer with opposing counsel. Having already given
their counsel authority to finalize the details of the same offer,
reasonable minds could conclude that the Allings had cloaked their
counsel with the apparent authority to re-offer, just days later, the
same offer from the settlement conference, and that the Robertsons

                                  13
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

reasonably relied on the Allings’ counsel’s representations of his
authority. See E.R. 4.1(1), Ariz. R. Prof’l Conduct, Ariz. R. Sup. Ct. 42
(attorneys have duty not to knowingly “make a false statement of
material fact or law to a third person” in course of representing
clients); Panzino, 196 Ariz. 442, ¶ 17, 999 P.2d at 203; Pace, 8
Ariz. App. at 271-72, 445 P.2d at 473-74; see also In re Artha Mgmt.,
Inc., 91 F.3d 326, 329 (2d Cir. 1996) (although based on different law
concerning attorney authority, because of “unique nature of the
attorney-client relationship” and “the public policy favoring
settlements,” court presumes “that an attorney-of-record who enters
into a settlement agreement, purportedly on behalf of a client, had
authority to do so”); Ackerman v. Sobol Family P’ship, LLP, 4 A.3d 288,
299-300, 304-05 (Conn. 2010) (after previously representing parties at
settlement conference, conferring publicly with clients after
conference, and assuring opposing counsel he had authority, lawyer
had apparent authority and could bind client to settlement).

¶30           Ultimately, these competing inferences required a
factual resolution and precluded the trial court from deciding the
issue as a matter of law. See Orme Sch., 166 Ariz. at 308, 309, 802 P.2d
at 1007, 1008; see also Shaffer v. Ins. Co. of N. Am., 113 Ariz. 21, 22, 545
P.2d 945, 946 (1976) (remanding for trial on issue of settlement
authority where statute allowed party to demand trial on disputed
fact). Given the lapse of the established time for acceptance of the
initial offer, the apparent need to secure the Allings’ physical
presence at the settlement conference to ensure the Allings’
counsel’s authority, and the lack of any further manifestations from
the Allings to the Robertsons after the settlement conference, we
cannot say as a matter of law that the Allings’ manifestations
invariably would have led others to believe their counsel had either
continuing settlement authority or the authority to re-offer the
lapsed offer with the same terms. Accordingly, a genuine dispute of
material fact exists with regard to the Allings’ attorney’s authority,
and Rule 80(d) applies. See Canyon Contracting, 172 Ariz. at 392, 837
P.2d at 753.

Rule 80(d) Compliance

¶31         Because Rule 80(d) applies, we must determine whether
its requirements were met here. As we noted above, where the
                                    14
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

attorney’s settlement authority was subject to a genuine dispute of
material fact, the writings were required to include written assent by
the principal in order to comply with Rule 80(d); any manifestations
of assent by the attorney could not be attributed to the client.
Canyon Contracting, 172 Ariz. at 393, 837 P.2d at 754. This
requirement supports the Rule’s purpose of avoiding difficult issues
of proof. Id.

¶32         Here, although the terms of the purported settlement
agreement are in writing, and the Allings’ counsel manifested his
assent, the Allings’ assent to the terms of the agreement was not
manifested in writing. As in Canyon Contracting, we conclude Rule
80(d) therefore precludes enforcement of the purported settlement
agreement. Id. Accordingly, the trial court erred in finding
compliance with the requirements of Rule 80(d).

¶33           The Robertsons argue, however, that even if Rule 80(d)
applies, its terms were met here, because the agreement was
sufficiently set forth in writing by counsel, relying on Hays, 161 Ariz.
at 166, 777 P.2d at 229. In Hays, we stated the record showed
unmistakably that the attorney represented the client and had the
client’s authority to enter into the settlement agreement. Id. We
then stated Rule 80(d) did not apply when “[t]he only issue was
whether [client] was bound by the settlement agreement” and the
agreement in question was not disputed. Id. But we distinguished
this situation in Canyon Contracting, reasoning that in Hays the
attorney’s settlement authority was not in question, only whether
the client was bound by the agreement before personally signing it,
which was a purely legal question. 172 Ariz. at 392, 837 P.2d at 753.
Thus, in Canyon Contracting, we concluded where a dispute over the
attorney’s authority exists, Rule 80(d) requires a direct manifestation
of assent from the principal. Id. at 393, 837 P.2d at 754. Because we
have concluded the Allings’ attorney’s authority was in dispute,
Hays does not support the Robertsons’ position.

¶34         At oral argument, the Robertsons suggested that this
case was identical to Perry v. Ronan, 225 Ariz. 49, 234 P.3d 617 (App.
2010), claiming in Perry the court had applied Hays to uphold a
settlement agreement accepted beyond the undisclosed expiration
date imposed by the clients. But in that case we concluded the offer
                                  15
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

could be accepted because of a delay in the communication of the
offer and did not decide the attorney had authority beyond that
authorized by his client. Id. ¶ 16 & n.3.

                               Estoppel

¶35          The Robertsons also argue that principles of estoppel
support enforcing the settlement agreement against the Allings even
in the absence of express or apparent authority. “We review a trial
court’s decision . . . to apply estoppel for an abuse of discretion.”
Flying Diamond Airpark, LLC v. Meienberg, 215 Ariz. 44, ¶ 27, 156 P.3d
1149, 1155 (App. 2007). A trial court abuses its discretion if it
commits an error of law in reaching a discretionary conclusion.
Grant v. Ariz. Pub. Serv. Co., 133 Ariz. 434, 455-56, 652 P.2d 507, 528-
29 (1982).

¶36           Equitable estoppel is an independent, common law
doctrine and thus not controlled by the enforceability of the
settlement agreement or the requirements of Rule 80(d). See St.
Joseph’s Hosp. & Med. Ctr. v. Reserve Life Ins. Co., 154 Ariz. 307, 317,
742 P.2d 808, 818 (1987). Under this doctrine, a person may “be held
liable as a party to a transaction purportedly done on his account as
a result of his manifestations to third parties that another is his agent
or as a result of his inaction if he knows third parties believe another
to be his agent and he does not take reasonable steps to notify them
otherwise.” Fuqua Homes, Inc. v. Grosvenor, 116 Ariz. 424, 426, 569
P.2d 854, 856 (App. 1977). The third party must rely to its detriment
on the apparent authority. Id. at 426-27, 569 P.2d at 856-57.

¶37          The trial court’s ruling on estoppel hinged on its
conclusion that the Allings’ counsel had apparent authority. But
because we have concluded based on the record before us that a
genuine dispute of fact exists concerning the Allings’ counsel’s
apparent authority, we also must conclude the court abused its
discretion in finding that equitable estoppel applied. We cannot say
as a matter of law that the Allings manifested apparent authority in
their counsel beyond the offer he extended at the settlement
conference. The Allings may not have known the Robertsons were
relying on the Allings’ counsel having continuing settlement
authority or that they were under an obligation to take reasonable

                                   16
              ROBERTSON, ET AL. v. ALLING, ET AL.
                     Opinion of the Court

steps to notify the Robertsons to the contrary. The Robertsons’
argument therefore must fail on appeal. To the extent the
Robertsons rely on Lawyers § 27 cmt. b for the proposition that the
Allings are estopped from challenging the settlement because of
their delay in making such notification, that section still first requires
a finding that the Allings had cloaked their attorney with apparent
authority, and so this argument also must fail. But although this
disputed factual issue cannot be resolved as a matter of law, the trial
court may find, after proceedings on remand, that the doctrine of
equitable estoppel requires enforcement of the settlement
agreement.

                              Disposition

¶38          For the foregoing reasons, we conclude the settlement
agreement is unenforceable under Rule 80(d). We further conclude
that, on this record, summary judgment was inappropriate on the
issue of estoppel. We therefore vacate the judgment concerning
estoppel and reverse the remainder of the judgment enforcing the
settlement. But we remand the case for further proceedings on the
estoppel issue and on the underlying claims and defenses, if
necessary. Finally, because the Robertsons were unsuccessful in this
appeal, we deny their request for attorney fees under A.R.S. § 12-
341.01. See Perry v. Ronan, 225 Ariz. 49, ¶ 19, 234 P.3d 617, 622 (App.
2010).

                                   17