Court Opinion

ID: 9493813
Source: CourtListenerOpinion
Date Created: 2023-08-05 15:20:14.672712+00
Date Added: 2024-06-11T17:56:03.017140
License: Public Domain

TERENCE T. EVANS, Circuit Judge,
concurring.
I can’t agree that the court-approved settlement order, which increased Hawkins’ obligation to $400,000 if he failed to make timely payments, is an unenforceable penalty clause. In fact, it seems to me that this sort of carrot-and-stick settlement agreement, blessed by a court in an order, is fairly routine. Surely, Checkers and Hawkins could have agreed to the entry of a judgment for $400,000, dis-chargeable as fully satisfied upon Hawkins paying $250,000 over 10 months. The court order here, in substance, isn’t any different. It is wrong, I submit, to characterize this agreement as one involving “damages.” It’s not. It involves an alternative entitlement if certain conditions are not met. And there is nothing wrong with that, especially here where we are dealing with big boys who ought to be able to freely agree on any mechanism for resolving what the court correctly describes as complicated and “lengthy commercial litigation.”
But that said, I join the court’s opinion because I think Checkers, by waiting to spring its $150,000 kicker until after it got all its money, waived its right to insist on strict compliance with the order’s timely payment provisions. So the court, in my view, is correct in rejecting Checkers’ claim (except for a pittance of interest), although I would do so for a different reason.