Buckner v. Buckner , 294 Ga. 705 ( 2014 )

FINAL COPY
294 Ga. 705
S13F1561. BUCKNER v. BUCKNER.
BENHAM, Justice.
Acting pursuant to Rule 34 (4) of the Rules of the Supreme Court of
Georgia, we granted the application of appellant Angela Buckner (Wife) for
discretionary review of the trial court’s order denying her motion to set aside the
consent final judgment of divorce entered in the action filed by appellee Mark
Buckner (Husband) and denying her motion to rescind or reform the settlement
agreement the parties signed. The record reflects that on December 20, 2012,
the parties appeared for a final hearing on their divorce proceeding but
continued to negotiate in an attempt to reach a settlement. On that day, the
parties memorialized an agreement by using a letter that had been prepared by
Husband’s counsel as a prior settlement offer and modifying it with handwritten
notations in the margins and handwritten terms on additional pages. The
document was then signed by both parties and their counsel, and counsel
announced to the court that the parties had reached an agreement and executed
a settlement memorandum. The settlement document was filed with the clerk
but not read into the record.
The original settlement offer letter contained language granting Husband
the “marital abode” and that language was not marked out or modified.
Nevertheless, Wife claims that throughout the two-and-a-half year period in
which this action was pending, she unequivocally demanded to keep the marital
home, which she had acquired prior to the marriage, and she claims she never
consented to grant Husband the home at any time during the final settlement
negotiations. In fact, she claims the agreement reached was for Wife to keep the
home and that it was a mutual mistake that this term was not correctly reflected
on the settlement memorandum. Later in the day on which the parties
announced they had reached a settlement agreement, Husband’s counsel sent to
Wife’s counsel a draft of a proposed consent final judgment and decree of
divorce that contained not only the terms set out in the settlement memorandum,
including the award of the marital home to Husband, but also contained what
Wife asserts were additional substantive terms not addressed in the settlement
memorandum. Counsel for both parties continued to exchange proposed drafts
of the final order.
After Husband claimed the house was his own and attempted to gain
possession of the house, Wife’s counsel notified the trial court by letter on
2
January 17, 2013, that she intended to file a motion to set aside the settlement
because there were errors in the settlement document, namely, that the
agreement erroneously awarded the marital home to Husband. On January 22,
2013, Wife filed the motion titled “Motion to Set Aside Memorandum of
Settlement Not Representative of the Understanding of the Parties or in the
Alternative Motion to Withdraw from and Set Aside Agreement” along with
supporting affidavits. Minutes after Wife filed her motion, however, the trial
court entered an order titled “Consent Final Judgment and Decree,” to which the
disputed settlement memorandum was attached. The order reflects it was
prepared by Husband’s counsel and the space provided for Wife’s counsel to
indicate her consent to the order is not signed. It is apparently undisputed that
the proposed order was submitted ex parte. Wife then filed a motion to set aside
the judgment on the ground the settlement memorandum attached to the order
was signed by mutual mistake and did not represent a meeting of the minds. In
the brief supporting the motion, Wife also asserted the terms of the final decree
were neither fair nor equitable since it required her to forfeit valuable assets,
including the couple’s business and her premarital home, leaving her with a
large income tax liability and without an equitable award of marital assets.
3
After conducting an evidentiary hearing, the court denied the motion.
In the order granting Wife’s application for discretionary review, this
Court indicated it was particularly concerned with the following issues:
1. Did the parties enter into a settlement agreement? If so, what
were the terms of the agreement?
2. Did the trial court err in entering the decree of divorce based
on the purported settlement agreement?
3. Did the trial court err in refusing to set aside the decree of
divorce?
For the following reasons, we affirm that part of the order denying Wife’s
motion to rescind or set aside the settlement agreement but we reverse that part
of the order denying Wife’s motion to set aside the “Consent Final Judgment
and Decree,” and we vacate the final judgment.
1. With respect to whether the parties reached an enforceable settlement
agreement, both Wife and her counsel admitted they executed the document the
parties referred to as the memorandum of settlement. The settlement
memorandum contained various terms, including the term “[Husband] will get
the former marital abode and the shop,” and the term “[Husband] gets the
business.” It also stipulated which of the two parties would be awarded various
other personal and real property, including another house awarded to Wife. It
4
set forth a schedule of cash payments to be made by Husband to Wife and to her
counsel,1 pledged the cooperation of the parties in filing amended business tax
returns for the purpose of reducing Wife’s tax liability, and contained other
miscellaneous provisions.
The fact that the parties continued to negotiate various additional details
to the settlement agreement after they announced a settlement had been reached
by exchanging versions of a proposed consent order is not evidence, in this case,
that the parties had not reached an enforceable agreement regarding settlement
of the marital estate. The various drafts refined the details of the settlement,
such as the time and method for exchanging the awarded property and assigning
responsibility for the parties’ individual and business debts to the party who was
awarded the asset on which the debt was incurred. We do not construe this
assignment of debt to be a material term that alters the substance of the
agreement, particularly since the parties appeared to have agreed to this
assignment of debt in their exchange of various drafts of the proposed consent
order. The only significant difference between these drafts was that in each
1
The cash payments to Wife were increased in handwritten revisions by a total of
$22,000, which was approximately half the equity value of the marital abode.
5
draft proposed by Husband, the marital home was to be awarded to him, as
reflected in the settlement memorandum, and in each draft proposed by Wife,
the marital home was to be awarded to her. In this case, the original settlement
memorandum was not inadequate or unenforceable as a result of leaving
substantive matters for later resolution. Compare Moss v. Moss, 265 Ga. 802
(463 SE2d 9) (1995) (concluding a written settlement agreement was incomplete
and unenforceable because it left for future agreement the method for appraising
the property to be transferred from the husband to the Wife, which was a
material term). Likewise, except for the continued dispute over the award of the
marital home, the details supplied in the proposed consent orders the parties
exchanged after executing the settlement memorandum did not relate to material
matters that revised the agreement’s substantive terms. Consequently, we reject
the assertion that this exchange of documents supports the conclusion that the
parties had not reached an enforceable agreement. Compare DeGarmo v.
DeGarmo, 269 Ga. 480, 481 (1) (499 SE2d 317) (1998) (concluding a written
settlement agreement was incomplete and unenforceable as evidenced by the
fact that the parties continued to make multiple substantive revisions to it).
Settlement agreements in divorce cases are construed in the same manner
6
as all other contractual agreements. Jones v. Jones, 280 Ga. 712, 714 (1) (632
SE2d 121) (2006). Even a pro se litigant has the duty to read a contract before
signing it and by signing, the party is bound by its terms
unless [she] can show that an emergency existed at the time of
signing that would excuse [her] failure to read it, or that the
opposite party misled [her] by an artifice or device which prevented
[her] from reading it, or that a fiduciary or confidential relationship
existed between the parties upon which [she] relied in not reading
the contract.
Cochran v. Murrah, 235 Ga. 304, 305 (219 SE2d 421) (1975). No evidence was
presented in this case that would relieve Wife from being bound by the terms of
the document she and her counsel signed. Both Wife and her trial attorney
testified they were mistaken about the fact that the document they signed stated
the home would go to Husband and not to Wife, and they also testified the
parties did not agree to award the home to Husband but actually agreed the Wife
would get the home. Consequently, she argues mutual mistake. The credibility
7
of witnesses, however, is for the trial court sitting as the trier of fact, and we find
no error in the court’s conclusion that the evidence failed to show mutual
mistake. See Kennedy v. Kennedy, 243 Ga. 275 (253 SE2d 761) (1979).
Further, the mistake could have been discovered by exercising reasonable
diligence. See Primary Investments, LLC v. Wee Tender Care III, Inc., 323 Ga.
App. 196, 201 (2) (746 SE2d 823) (2013) (finding no error in the grant of
summary judgment against the party seeking to rescind and reform a contract
where that party had ample opportunity to read the draft of the agreement it
signed and to discover a change in one of the terms from a previous draft but did
not); Decision One Mortgage Co., LLC v. Victor Warren Properties, Inc., 304
Ga. App. 423, 425 (696 SE2d 145) (2010). We conclude the parties reached an
enforceable settlement agreement and that the trial court did not err in denying
Wife’s request to rescind or reform it.
2. The trial court erred, however, when it entered an order titled “Consent
Final Judgment and Decree” even though no record evidence exists that Wife
consented to its entry. The proposed order, presented ex parte to the trial court,
reflects that Wife’s counsel’s signature is missing from the space indicating her
consent. More importantly, Wife’s counsel notified the trial court by letter
8
several days prior to the date the order was entered that Wife believed there was
a “glaring error” in the settlement memorandum and asked the trial court not to
enter a final order in the case until she could be heard on a soon-to-be-filed
motion to set aside.
Here, Husband’s counsel knew Wife refused to abide by the terms of the
settlement memorandum. He knew Wife’s counsel had not consented to the
proposed order he drafted. Nevertheless, he submitted the proposed order to the
trial court ex parte, without notifying Wife’s counsel. “A lawyer who obtains
a judge’s signature on a decree in the absence of the opposing lawyer where
certain aspects of the decree are still in dispute, may have violated Rule 3.5:
Impartiality and Decorum of the Tribunal regardless of the lawyer’s good
intentions or good faith.” Comment 3B to Rule 3.5 of the Georgia Rules of
Professional Conduct. At the least, this conduct demonstrates a disappointing
lack of professionalism of Husband’s trial counsel.2 The better practice would
have been for Husband’s counsel to file a motion to enforce the settlement
agreement, to which Wife would have been afforded the opportunity to file a
response within 30 days, pursuant to Uniform Superior Court Rule 6.
2
Husband’s appellate counsel is not the attorney who executed the Consent Order.
9
In ruling on a motion to enforce, the trial court would have then been
required to determine whether the parties had reached an enforceable agreement
that was within the bounds of the law before entering a final judgment in the
matter. We recognize the trial court conducted an evidentiary hearing in this
case and correctly ruled that the settlement memorandum was enforceable. But
we do not find the erroneous denial of Wife’s motion to set aside the “Consent
Final Judgment” to be harmless error. In this case, since the trial court
apparently knew or should have known that the parties had not consented to the
proposed order, it should not have entered the order without further inquiry into
the equitable issues raised by Wife’s motion to set aside the final decree. At the
hearing on Wife’s motion to set aside the final judgment, the trial court
announced that the only issue it was hearing was whether there was a mutual
mistake that would permit the court to set aside the settlement agreement filed
in the case. Based upon its finding that there was no mutual mistake as to the
terms of the settlement memorandum executed by the parties, the trial court
concluded that no grounds exist upon which it may grant rescission of the
settlement agreement or grant the motion to set aside the final judgment. Wife’s
motion sought relief pursuant to the court’s inherent power, pursuant to OCGA
10
§ 15-1-3 (6), to exercise discretion to amend or set aside a judgment, which may
be done for any meritorious reason, provided the motion to set aside is filed
during the term in which the judgment was rendered.3 See Pope v. Pope, 277
Ga. 333, 334 (588 SE2d 736) (2003). In fact, the trial court should have
exercised its discretion to set aside the judgment because it should not have been
entered in the first place, at least not in the form of a consent order. Even in a
case in which the parties to a divorce action have reached a settlement
agreement, the trial court has a duty to make an independent determination of
“whether its contents are within the bounds of the law prior to its incorporation
into the final decree of divorce.” Page v. Page, 281 Ga. 155, 156 (635 SE2d
762) (2006). The trial court has the discretion to approve or reject a divorce
settlement agreement in whole or in part. See Arnold v. Arnold, 282 Ga. 246
(647 SE2d 68) (2007).
The record reflects the trial court failed to exercise its discretion in this
case and shows, instead, that the court entered a proposed “consent” order to
which the Wife did not consent. Further, by announcing the only purpose of the
3
It is undisputed that Wife’s motion was filed in the same term of court in which the final
judgment was entered.
11
hearing was to determine whether mutual mistake provided a ground for
rescinding the settlement agreement, it appears Wife was not afforded the
opportunity to present evidence in support of her assertion that the proposed
order, even though based upon the settlement agreement, would result in an
inequitable division of marital assets. Accordingly, the order denying Wife’s
motion to set aside the final judgment is reversed, and the final judgment is
vacated.
Judgment affirmed in part, reversed in part, and vacated in part. All the
Justices concur.
Decided March 3, 2014.
Domestic relations. Paulding Superior Court. Before Judge Osborne.
Candace E. Rader, Daniel B. Greenfield, for appellant.
Bryan R. Howard, Edward T. Murray, for appellee.
12