No Enforceable Settlement Where Attorney Had No Authority to Settle
Munroe v. U.S. Food Service, decided on 6/27/2008, illustrates the risks inherent in "settling" a case at mediation when one party's attorney doesn't have authority to do so. The parties in Munroe went to a mediation conference where they conditionally agreed to settle for $30,000.00. The problem was that the E/C’s attorney didn't actually have $30,000.00 in authority at the time. Nevertheless, he promised to obtain the necessary authority within 20 days which, in fact, he did. But by that time the claimant had changed his mind and decided not to settle for the agreed upon amount. The E/C then filed a motion to enforce the agreement because their attorney had timely obtained the authority within the allotted time, and the JCC granted the motion.
But on appeal the First District Court of Appeal reversed, holding that because the agreement was contingent upon the happening of some future event, no contract had been formed before the claimant elected to back out. The court also pointed out the rule which says that “failure. . .to appear at the mediation conference with full authority to resolve the issues may subject the party or attorney to sanctions.”
Note also that the First DCA doesn't defer to the ruling of the JCC in these types of cases. Whether there is an enforceable settlement agreement is a question that is reviewed de novo.
