Hansen v. Doan

Citations: 320 Ga. App. 609; 740 S.E.2d 338; 203 Fulton County D. Rep. 909; 2013 WL 1150623; 2013 Ga. App. LEXIS 247Docket: A12A1988

Court: Court of Appeals of Georgia; March 21, 2013; Georgia; State Appellate Court

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The appeal involves defendant Laura Doan enforcing a settlement agreement against plaintiff Lawrence Hansen in a personal injury case stemming from a motorcycle accident on June 22, 2011, where Hansen suffered severe injuries after being struck by Doan’s vehicle. Hansen’s attorney, Keith Bodoh, communicated with Liberty Mutual, Doan’s insurance carrier, beginning with a letter on July 1, 2011, indicating Hansen's serious injuries and requesting policy limits information under OCGA § 33-3-28. Liberty Mutual’s claims specialist, Brenda O’Rear, confirmed the $25,000 liability coverage and indicated minimal documentation was needed to process the claim.

On July 11, Bodoh submitted a time-limited settlement demand for the full $25,000, contingent upon specific conditions including the signing of a Limited Release and prompt payment. O’Rear later requested an interview and additional medical documentation from Hansen, but did not directly reference the settlement offer. During a recorded phone conversation on July 22, O’Rear communicated that the information provided was sufficient to tender the policy limits and confirmed Liberty Mutual’s agreement to pay the $25,000, stating they would also agree to a limited release. The conversation indicated Bodoh’s intent to finalize the settlement but highlighted potential issues with the release language. O’Rear’s subsequent fax confirmed their agreement to pay the policy limits and willingness to draft a limited release.

A limited release document is being tailored for a settlement, with a request for feedback on any changes. The demand letter specified that a check must be received within 12 days, which would be by July 25, 2011. Efforts were made to finalize the settlement details promptly, or alternatively, to arrange for mailing the check. The enclosed release included indemnification language, contrary to Bodoh’s demand. O’Rear attempted to contact Bodoh multiple times and ultimately sent a letter on July 25, confirming the check's delivery and reiterating the need to finalize the limited release. However, Bodoh indicated that the settlement offer was withdrawn due to Liberty Mutual's failure to accept it in time and the inclusion of indemnification in the release. Hansen subsequently filed a personal injury action against Doan, who moved to enforce the settlement agreement. The trial court granted Doan’s motion, leading to Hansen's appeal. The appellate court reviews settlement agreements based on mutual agreement and the necessity for clear acceptance of terms without modification. The burden of proof lies with the party claiming that a contract exists. Hansen argues that the trial court erred in enforcing the agreement due to Liberty Mutual's failure to provide a release without indemnification language.

An offer can be accepted through either a promise or the actual execution of the proposed action, and acceptance must align with the specified method in the offer. In this case, Liberty Mutual's delivery of a release with indemnification language, which contradicted Hansen’s settlement demand, was deemed an acceptance of the offer. Courts utilize an objective theory of intent to ascertain mutual assent, interpreting one party's intent as a reasonable person in the position of the other would understand it. Relevant circumstances and extrinsic evidence, such as correspondence and discussions, play a crucial role in determining mutual agreement. 

Liberty Mutual's initial response to Hansen's settlement offer was a request for additional information, which did not constitute a counteroffer. Subsequent communications included a call where Liberty Mutual expressed readiness to offer policy limits and indicated a willingness to accommodate Hansen’s release preferences. O’Rear, representing Liberty Mutual, suggested that Hansen could modify the release as needed and did not imply that the terms differed from Hansen's requests. There was no indication that the release was intended as a counteroffer or that Hansen had to accept it without modifications. The inclusion of an undesirable release form does not negate the existence of mutual consent regarding the settlement terms. Ultimately, it was established that Liberty Mutual accepted Hansen’s offer without any discrepancies.

Liberty Mutual's actions, specifically tendering policy limits and providing Hansen with a limited liability release, constituted acceptance of the offer, creating a binding contract despite the lack of mutual exchange of promises. The case of Kitchens v. Ezell is distinguished from the present case, as it did not involve an invitation for the plaintiff’s counsel to modify the proposed releases. Other cited cases (Frickey, McReynolds, Wyatt) are similarly distinguishable based on their specific circumstances regarding settlement requirements. Hansen concedes that the trial court's ruling on the timely acceptance of the check should be upheld under the "right for any reason" rule. The document emphasizes that for a contract to be enforceable, acceptance must be unequivocal and identical to the offer, and any new conditions would constitute a counteroffer. The burden of proving the existence and terms of a contract falls on the party asserting it.

Hansen argues that the trial court improperly enforced the settlement agreement because Liberty Mutual did not meet the specific condition of providing a limited release free of indemnification language. An offer can be accepted either through a promise or by performing the specified act, and acceptance must align with the terms of the offer. The core issue is whether Liberty Mutual's provision of a release including indemnification language contradicted Hansen's demand for a different release. The court concludes that this delivery constituted acceptance.

To determine mutual assent necessary for a contract, an objective theory of intent is applied, where a party's intentions are assessed based on how a reasonable person would interpret those intentions. The context of the contract formation, including communications and discussions, is relevant, allowing for consideration of extrinsic evidence. In this case, the communications between Hansen and Liberty Mutual are examined. Initially, Liberty Mutual's request for an interview regarding Hansen's medical bills did not constitute a counteroffer. Subsequently, an agent from Liberty Mutual, O’Rear, indicated she could provide the desired limited release but mentioned that the only version available might contain undesirable language. Hansen did not directly respond and opted to provide his fax number for future correspondence. O’Rear then faxed a letter summarizing their conversation, encouraging Hansen to modify the release as needed. Throughout these exchanges, O’Rear did not indicate any intent to propose different terms than those Hansen requested.

No evidence suggests that the release provided by O’Rear was intended to be a counteroffer, nor was Hansen required to sign it as a condition of settlement. O’Rear anticipated that Bodoh would modify any unacceptable portions of the release. Established legal precedent indicates that the presence of an unacceptable release form does not negate the existence of a mutual agreement regarding settlement terms. Liberty Mutual accepted Hansen’s offer clearly and without deviation, fulfilling the conditions for acceptance by tendering the policy limits and allowing Hansen's attorney to adjust the release. This led to the formation of a binding contract concerning mutuality. The case of Kitchens v. Ezell does not change this outcome, as it is not binding physical precedent and is factually different; it did not allow for changes to the release as this case does. Other cited cases are also distinguishable on similar grounds. Hansen's objection to the trial court's acceptance timing is conceded on appeal, affirming the trial court's ruling that Liberty Mutual met the deadline for delivering the check. The judgment is affirmed, with some judges dissenting. The trial court's decision is supported by relevant standards regarding settlement agreement enforceability.