Jacob Todd v. Tonji Coleman and Amos Johnson , 119 N.E.3d 1137 ( 2019 )

FILED
Mar 08 2019, 6:04 am
CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court
ATTORNEYS FOR APPELLANT ATTORNEY FOR APPELLEES
Crystal G. Rowe Ryan D. Etter
Alyssa C.B. Cochran Ken Nunn Law Office
Kightlinger & Gray, LLP Bloomington, Indiana
New Albany, Indiana
Galen Bradley
Kightlinger & Gray, LLP
Merrillville, Indiana
IN THE
COURT OF APPEALS OF INDIANA
Jacob Todd, March 8, 2019
Appellant-Defendant, Court of Appeals Case No.
18A-CT-2138
v. Interlocutory Appeal from the Cass
Circuit Court
Tonji Coleman and Amos The Honorable Leo T. Burns,
Johnson, Judge
Appellees-Plaintiffs Trial Court Cause No.
09C01-1607-CT-19
Crone, Judge.
Court of Appeals of Indiana | Opinion 18A-CT-2138 | March 8, 2019 Page 1 of 9
Case Summary
[1] Tonji Coleman was injured in an automobile accident and filed a negligence
action against Jacob Todd. The parties’ attorneys engaged in negotiations and
made a verbal agreement to settle the case for $10,000. The trial court initially
ordered Coleman to comply with the settlement agreement but subsequently
granted Coleman’s motion to reconsider and rescinded the original order. In
this interlocutory appeal, Todd asserts that Coleman is bound by the settlement
agreement and that the trial court therefore erred in rescinding its order to
compel compliance. We reverse and remand.
Facts and Procedural History
[2] In July 2016, Coleman filed a negligence action against Todd stemming from
an August 2014 automobile accident in which she was injured.1 Over the next
eighteen months, the parties scheduled three mediation sessions but completed
none, due largely to Coleman’s nonattendance. In January 2018, Coleman’s
counsel (“Counsel 1”)2 negotiated with counsel for Todd’s insurer (“Insurer”) to
settle all claims. Insurer’s initial offer of $5000 was increased via counteroffer
to a $10,000 settlement of all claims. On February 2, 2018, Counsel 1 indicated
that Coleman had agreed to the $10,000 figure, and Insurer began preparing the
necessary documents. On February 12, 2018, Insurer filed a notice of
1
Amos Johnson is also a named plaintiff, but he is not participating in this appeal.
2
“Counsel 1” refers to Leeman Law Offices. Two attorneys worked on Coleman’s case, Kelly Leeman and
Amber Garrison. Appropriate distinctions between the two attorneys will be designated as necessary.
Court of Appeals of Indiana | Opinion 18A-CT-2138 | March 8, 2019 Page 2 of 9
settlement in the trial court. On February 21, 2018, Counsel 1 sent Insurer a
letter requesting that the settlement check be issued. Two days later, Counsel 1
discovered that Coleman had hired another law firm (“Counsel 2”) to represent
her. Meanwhile, Insurer sent the settlement documents to Counsel 1, who
informed Insurer about the change of representation and forwarded the
documents to Counsel 2 with a letter apprising Counsel 2 of the accepted
settlement offer.
[3] During the next couple months, Todd learned that Coleman no longer wanted
to settle the case. On April 19, 2018, Todd, through Insurer, filed a motion to
enforce the settlement agreement. The trial court granted Todd’s motion and
issued an order for Coleman to comply with the settlement agreement. A few
days later, Coleman filed a motion to reconsider, claiming that she neither
agreed to nor signed the $10,000 settlement agreement. She requested that the
trial court issue an order rescinding its previous order enforcing settlement. The
trial court conducted a hearing, during which Coleman and Counsel 1 testified.
Both attorneys from Counsel 1 testified that it was their understanding, based
on communications with Coleman, that they had authority to agree to the
$10,000 settlement. When questioned about the settlement negotiations and
why she decided to seek different representation, Coleman testified, “[Counsel
1] said, uh, how about five thousand dollars for your pocket, is what I heard the
first time and the second day it was ten thousand, so I am thinking the next day
it might be fifteen, so, I just was done at that point.” Tr. Vol. 2 at 14.
Court of Appeals of Indiana | Opinion 18A-CT-2138 | March 8, 2019 Page 3 of 9
[4] The trial court issued an order with findings of fact, specifically finding that
Counsel 1 had actual and apparent authority to enter into the settlement
agreement. Notwithstanding, the court granted Coleman’s motion and
rescinded its original order to compel compliance. This interlocutory appeal
ensued. Additional facts will be provided as necessary.
Discussion and Decision
[5] Todd contends that the trial court erred in granting Coleman’s motion to
reconsider. A trial court has the inherent power to reconsider, vacate, or
modify any previous order so long as the action remains in fieri, meaning that it
is “pending resolution.” Pond v. Pond, 700 N.E.2d 1130, 1135 (Ind. 1998);
Stephens v. Irvin, 734 N.E.2d 1133, 1135 (Ind. Ct. App. 2000), trans. denied
(2001). Here, the trial court’s order included specific findings of fact. When a
trial court issues specific findings sua sponte, the findings control our review
and the judgment as to the issues those findings cover; for all other issues, we
apply a general judgment standard. State Farm Ins. Co. v. Young, 985 N.E.2d
764, 766 (Ind. Ct. App. 2013). We apply a two-tiered standard of review,
determining first whether the evidence supports the findings and then whether
the findings support the judgment. Id. We review the findings for clear error
and will reverse when our review of the record leaves us with a firm conviction
that a mistake has been made. Id. We neither reweigh evidence nor reassess
witness credibility. Id. While we defer substantially to findings of fact, we do
not do so to conclusions of law. Id.Court of Appeals of Indiana | Opinion 18A-CT-2138 | March 8, 2019 Page 4 of 9
[6] Coleman sought and was granted rescission of the trial court’s previous order to
compel compliance with the $10,000 settlement agreement. This Court has
stated,
Indiana strongly favors settlement agreements and if a party
agrees to settle a pending action, but then refuses to consummate
his settlement agreement, the opposing party may obtain a
judgment enforcing the agreement. Settlement agreements are
governed by the same general principles of contract law as other
agreements. Generally, a settlement agreement is not required to
be in writing.
Sands v. Helen HCI, LLC, 945 N.E.2d 176, 180 (Ind. Ct. App. 2011) (citations
omitted), trans. denied.
[7] Here, the trial court found, in pertinent part, as follows:
3. Plaintiff, Tonji Coleman’s counsel Kelly Leeman, had actual
and apparent authority to enter into the settlement agreement
that is the subject of this dispute.
4. It is clear from the record of the proceedings that the Plaintiff,
Tonji Coleman, has never signed the terms of any settlement
agreement nor has she released any claims that she has, or may
have, against the Defendant.
5. The testimony provided by Plaintiff, Tonji Coleman, on July
3, 2018, made it clear to the Court that she is not prepared to
settle her dispute against the Defendant in this case.
6. Equally compelling is the testimony of Tonji Coleman’s
lawyers, Kelly Leeman and Amber Garrison [Counsel 1].
7. Mrs. Garrison’s testimony in open court convinces this Court
Court of Appeals of Indiana | Opinion 18A-CT-2138 | March 8, 2019 Page 5 of 9
that she maintained her professional responsibility to her client,
Tonji Coleman, in several conversations leading up to the
settlement offer of $10,000 which is a part of the record of this
proceeding.
8. The evidence is clear that Plaintiff, Tonji Coleman, did not
stay in regular contact with her counsel, moved her residence to a
different state and reached a point of frustration with the
litigation that compelled her to ask [Counsel 1], to “get the case
over with.”
9. Prior to making the settlement offer of $10,000, the evidence
supports a finding that Ms. Coleman did not fully cooperate in
the litigation of the matter, specifically, efforts to mediate the
case were continued on three separate occasions due to the
Plaintiff’s inability or refusal to follow the request of [Counsel 1]
and participate in scheduled mediation.
10. Notwithstanding the foregoing, Ms. Coleman has a right to
have her case against the Defendant tried to a jury with [Counsel
2], and forcing her to comply with the terms of the settlement
agreement would not adequately protect her due process rights.
11. Ms. Coleman … ha[s] the right to pursue this litigation to
conclusion on whatever terms are suggested by [Counsel 2],
including a trial of the issue to a jury.
….
13. This order should not be construed by any person or under
any set of facts as a conclusion that the Plaintiff, Tonji Coleman,
was not adequately represented by [Counsel 1].
Appealed Order at 1-2.
Court of Appeals of Indiana | Opinion 18A-CT-2138 | March 8, 2019 Page 6 of 9
[8] Todd maintains that finding 3, that Counsel 1 had actual and apparent
authority to enter into the settlement agreement on Coleman’s behalf,
contradicts the trial court’s ultimate decision to rescind its order compelling
Coleman to comply with the settlement agreement. We agree. “Actual
authority is created by written or spoken words or other conduct of the principal
which, reasonably interpreted, causes the agent to believe that the principal
desires him so to act on the principal’s account.” Fid. Nat’l Title Ins. Co. v.
Mussman, 930 N.E.2d 1160, 1165 (Ind. Ct. App. 2010), trans. denied (2011).
Actual authority focuses on the belief of the agent and may be express, implied,
or created by acquiescence. Id. With respect to apparent authority, there must
be a manifestation by the principal to support a reasonable belief and inference
of authority. Id.[9] Coleman relies on Bay v. Pulliam in asserting that her decision to retain Counsel
1 did not automatically constitute implied authority to settle her claim. 872
N.E.2d 666, 668 (Ind. Ct. App. 2007). It is well settled that an attorney may
not settle a claim without the client’s consent. Id. However, unlike in Bay, the
trial court here specifically found that Counsel 1 had “actual and apparent
authority to enter into the settlement agreement that is the subject of this dispute.”
Appealed Order at 1 (emphasis added). Moreover, in Bay, information as to the
conversations between the client and attorney was not presented through
testimony or any other type of evidence but was merely referenced during
counsel’s argument to the court. 872 N.E.2d at 668. In contrast, here,
Court of Appeals of Indiana | Opinion 18A-CT-2138 | March 8, 2019 Page 7 of 9
Coleman and both Counsel 1 attorneys testified at the hearing concerning the
settlement offers.
[10] Leeman testified that Coleman had authorized the firm to settle for $5000,
explaining, in relevant part,
[] Leeman: She got an offer for five (5) thousand dollars that was
submitted to her …. [B]ecause of her circumstances she wanted
to take it and told us to take the five (5) thousand. I made the
offer back, at least ten (10) thousand, so, cause if she was
desperate to get some money, five (5) thousand was way under
what it ought to be in my view and the amount of time and
money we had involved in it. But if her circumstances were such
that she wanted it done and over with then …
[PLAINTIFF’S COUNSEL]: You made that ten (10) thousand
dollar offer on you own then, if she want[ed] five (5) you just
tried to get more for her and you made the ten (10) thousand
dollar offer on your own?
[] Leeman: Yes.
Tr. Vol. 2 at 27.
[11] Garrison, the associate assigned to the case, testified, “it was my understanding
that Tonji was ready to put the case to bed, and yes, that she was fine with that
offer …. I did not have a doubt at the time …. [S]he was ready to be done.” Id.
at 34, 40. She also testified that her firm “did not just make an offer of ten
thousand (10,000) dollars … without discussing it with our client. We, I
discussed it [with] Tonji.” Id. at 44.
Court of Appeals of Indiana | Opinion 18A-CT-2138 | March 8, 2019 Page 8 of 9
[12] Finally, when asked if she ever told Counsel 1 to settle the case for $10,000,
Coleman responded, “I told them that they could do whatever they have been
doing to assist me []as my lawyers because I didn’t know what was going on
and it was a bit confusing[.]” Id. at 11. The foregoing evidence, which we may
not reweigh, is sufficient to support the trial court’s specific finding that Counsel
1 had actual and apparent authority to enter into the settlement agreement on
Coleman’s behalf. As for the second tier of our review, we conclude that the
trial court’s ultimate decision to rescind its original order is not supported by
the findings. Because the court’s order is internally contradictory, we reverse
and remand for proceedings consistent with this decision.
[13] Reversed and remanded.
Vaidik, C.J., and Mathias, J., concur.
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