Often plaintiffs must work towards settlement not only with a defense attorney, but also an insurer. One strategic area during a lawsuit is settlement offers. There can be an advantage to trying to settle early. However, offers must be extremely specific. This is why it is critical to secure the help of an experienced attorney before communicating with the insurer for the other side.
In a recent case, a defendant appealed the final judgment entered in favor of a wrongful death plaintiff. The plaintiff and her minor child were in a car when they were rear-ended by the defendant’s car. The impact pushed the plaintiff’s car into a moving train. This caused severe injuries to the plaintiff and killed her son.
The plaintiff’s attorney contacted the defendant’s insurer and offered to settle with the policy limits. The offer had a time limit for accepting and included a reference to restrictions on the nature of the release. The insurer responded to the offer, including some draft checks and proposed releases. The plaintiff’s attorney told the insurer that the releases violated the terms of the offer and that it would therefore consider the response a rejection and counteroffer.
The defendant’s answer and affirmative defenses filed in response to the complaint included the defense that the plaintiff had made a settlement offer which the defendant accepted. The plaintiff denied the settlement and filed for partial summary judgment, arguing that because the releases were inconsistent with her offer, there was no judgment as a matter of law.
The motion was granted by the court and the judge ruled there was no meeting of the minds–in other words, no acceptance of the offer. The jury awarded the plaintiff a judgment of over $10.5 million. The defendant appealed, arguing that the terms of the releases were not essential elements of the plaintiff’s offer to settle.
The appellate court explained that settlement agreements are decided in accordance with contract law. In Florida contract law, an acceptance of an offer must be absolute and unconditional, identical to the terms of the offer, and in the mode prescribed by the offer. Although settlements are favored, the party seeking judgment based on settlement must show assent and a meeting of the minds.
In this case, the plaintiff’s attorney had advised the insurer that he understood there was coverage of up to $10,000 per person and $20,000 per accident. He indicated settlement had to take place by Easter weekend. He asked that the insurer replace $650 worth of personal property. The offer specifically stated that only the insured would be released for bodily injuries and that the plaintiff would not agree to a release that had a hold harmless or indemnity agreement in it. It expressly stated that if a release was sent including a hold harmless/indemnity provision, it would serve as a rejection of the plaintiff’s offer.
When the insurer responded, the proposed releases included a full and final release including all past, present or future claims for subrogation, and a notation asking for notification if the plaintiff required modification of the release.
The defendant’s attorney wrote to the plaintiff’s attorney letting him know she would send the original affidavit that her client had signed and that she believed the matter was concluded. The plaintiff’s attorney told the insurer he considered the proposed releases a rejection because the reference to “subrogation claims” were effectively a hold harmless/indemnification clause.
The appellate court explained that the proposed releases had to meet the specifications of the offer and simply offering to alter the released language wasn’t enough to bind the plaintiff.
The appellate court explained that the plaintiff could not release the defendant from liability to third parties who he knew had a subrogation claim against him. In other words, if a third party compensated her for some of her losses, it would be possible for the third party to go after the defendant. In that case, the insurer’s proposed language could be the basis for another lawsuit by the defendant against the plaintiff. The appellate court affirmed the partial summary judgment and the final judgment in favor of the plaintiff.
If you are injured or a loved one is wrongfully killed because of somebody else’s negligence, call the experienced personal injury attorneys at Friedman, Rodman & Frank toll-free for a free consultation at (877) 448-8585.
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