Troy Jonas v. State Farm Life Insurance Company ( 2016 )


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  •                                                                                   FILED
    Mar 30 2016, 9:17 am
    CLERK
    Indiana Supreme Court
    Court of Appeals
    and Tax Court
    ATTORNEYS FOR APPELLANT                                   ATTORNEY FOR APPELLEE
    David F. McNamar                                          Dennis F. Cantrell
    McNamar & Associates, P.C.                                Cantrell Strenski & Mehringer
    Indianapolis, Indiana                                     LLP
    Indianapolis, Indiana
    Guy O. Kornblum
    Kornblum, Cochran, Erickson,
    Harbison, LLP
    San Francisco, California
    IN THE
    COURT OF APPEALS OF INDIANA
    Troy Jonas,                                               March 30, 2016
    Appellant-Plaintiff,                                      Court of Appeals Case No.
    29A02-1510-PL-1761
    v.                                                Appeal from the
    Hamilton Superior Court
    State Farm Life Insurance                                 The Honorable
    Company,                                                  Daniel J. Pfleging, Judge
    Appellee-Defendant.                                       Trial Court Cause No.
    29D02-1504-PL-2825
    Kirsch, Judge.
    [1]   Troy Jonas (“Jonas”) appeals the trial court’s order granting summary
    judgment in favor of State Farm Life Insurance Company (“State Farm”).
    Jonas raises the following restated issue for our review: whether the trial court
    erred when it determined that Jonas entered into a settlement agreement with
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016                     Page 1 of 16
    State Farm and then refused to follow through with the agreement, which
    constituted a breach of the settlement agreement.
    [2]   We affirm.
    Facts and Procedural History
    [3]   In May 2007, Jonas and his then-wife Jennifer Jonas (“Jennifer”) purchased
    reciprocal life insurance policies from State Farm. At that time, Jonas and
    Jennifer lived in Texas, and the policies were purchased there. Jonas owned
    the policy on his life with Jennifer as the primary beneficiary, and Jennifer
    owned the policy on her life with Jonas as the primary beneficiary. The
    couple’s children were the secondary beneficiaries on both policies. Pursuant to
    the policies, in the event of the death of either Jonas or Jennifer while insured
    under the policy, State Farm promised to pay death benefits with a face value of
    $1,000,000.00 to the beneficiary. In pertinent part, Jennifer’s policy (“the
    Policy”) provided as follows:
    OWNERSHIP PROVISIONS
    Owner. The Owner is as named in the Application, unless
    changed. You may exercise any policy provision only by
    Request and while the Insured is alive, subject to the rights of any
    assignee that we have on record and to the rights of any
    irrevocably designated Beneficiary. The Successor Owner will
    become the Owner of this Policy if you die while this Policy is in
    force.
    Change of Owner/Successor Owner. You may change the
    Owner or Successor Owner by Request while the Insured is alive
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016   Page 2 of 16
    and this Policy is in force. The change will take effect the date
    you sign the Request, but the change will not affect any action we
    have taken before we receive the Request. A change of Owner or
    Successor Owner does not change the Beneficiary Designation.
    Beneficiary Designation. This is as shown in the Application,
    unless you have made a change by Request. . . .
    Change of Beneficiary Designation. You may make a change
    by Request while the Insured is alive and while this Policy is in
    force. The change will take effect the date the Request is signed,
    but the change will not affect any action we have taken before we
    receive the Request.
    Appellant’s App. at 16-17; Appellee’s App. at 145-46. The Policy further stated:
    Method 1 (One Sum Method). We will pay the Proceeds in one
    sum. Interest will be paid from the date of the Insured’s death to
    the date of payment. The interest rate will be the greater of 2% a
    year or the interest rate required by law, if applicable.
    Appellant’s App. at 17; Appellee’s App. at 146.
    [4]   On August 9, 2011, Jonas and Jennifer were divorced by a court in Texas.
    Pursuant to the Final Decree of Divorce (“the Decree”), Jennifer was ordered
    to transfer ownership of the Policy to Jonas as part of the property distribution
    and to execute the necessary forms with State Farm within ten days of the
    Decree to do so. Appellant’s App. at 19; Appellee’s App. at 192. Jennifer did not
    execute the necessary forms with State Farm in compliance with either the
    Decree or the Policy. Shortly after the divorce was finalized, Jonas and the
    children moved to Carmel, Indiana.
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    [5]   On August 30, 2012, Jennifer died. On September 4, 2012, Jonas submitted a
    claim to State Farm for the Policy proceeds. Although State Farm agreed that
    the beneficiary of the Policy was entitled to the payment of the proceeds, it
    recognized that there was uncertainty under Texas law concerning how the
    Decree affected the manner of disbursement and to whom the Policy proceeds
    were to be paid. Therefore, on October 17, 2012, State Farm filed a
    “Complaint for Interpleader and Declaratory Relief” with the Southern District
    Court of Indiana. Appellee’s App. at 218-22. In that filing, State Farm stated it
    was willing to remit the Policy proceeds to the Clerk of the District Court and
    requested the District Court to direct State Farm to do so pending the District
    Court’s determination of the proper distribution of the proceeds to eliminate the
    risk of multiple liabilities for such payment. 
    Id. at 221.
    [6]   On May 1, 2013, State Farm filed a “Motion to Interplead Funds,” seeking an
    entry of an order authorizing it to interplead the Policy proceeds plus the
    Policy’s contractual interest calculated at 2% from the date of Jennifer’s death
    to the date of the District Court’s order “to be held for the benefit of the parties .
    . . until the Court makes a determination as to how the insurance proceeds shall
    be disbursed.” 
    Id. at 224.
    On June 11, 2013, the District Court issued an
    “Entry Regarding Pending Motions,” in which it granted State Farm’s Motion
    to Interplead Funds, ruling that, because the facts known to State Farm created
    a reasonable doubt as to who the proper beneficiary of the Policy was, it was
    proper under Texas law for State Farm to file an interpleader action instead of
    paying the proceeds to Jonas. Further, the District Court ordered that State
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016   Page 4 of 16
    Farm did not have to pay the 18% interest damages under Texas insurance law,
    as Jonas claimed, but only the 2% as provided under the Policy. 
    Id. at 232-33.
    On June 17, 2013, State Farm deposited the Policy proceeds in the amount of
    $1,016,216.78 per the District Court’s order with the Clerk of the Court.
    [7]   On October 22, 2013, State Farm filed a motion, seeking to be dismissed from
    the interpleader action with prejudice after complying with the District Court’s
    order to interplead the Policy proceeds. Jonas filed an objection to this motion,
    but the District Court granted State Farm’s motion and dismissed State Farm
    with prejudice from the action. In December 2013, Jonas and the guardian ad
    litem for the children entered into an agreement, in which Jonas agreed to
    disburse $150,000.00 into an irrevocable trust for the children. In February
    2014, after approving the agreement, the District Court entered a final judgment
    and ordered the Policy proceeds to be disbursed. On March 4, 2014, Jonas filed
    an appeal with the Seventh Circuit.
    [8]   On April 15, 2014, State Farm and Jonas reached a verbal settlement agreement
    to settle all of Jonas’s claims for $60,000.00. State Farm sent Jonas’s counsel a
    proposed Final Release Agreement, which included a confidentiality provision.
    On April 21, 2014, Jonas’s counsel sent the following email to State Farm:
    I have emailed the proposed release you sent me both to my
    client and to Rocco Spagna at the 7th Circuit. I advised him as
    to our disagreement about the confidentiality clause in this
    proposed agreement. My client desires me to withdraw our offer
    to settle and proceed with the appeal. I have asked him to hold
    off on that until the end of today. He also agrees with me as to
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016   Page 5 of 16
    the confidentiality clause. As a result, if we do not have an
    agreement by the end of business today, we will withdraw our
    offer to settle for the $60,000.00 and proceed to file our brief with
    this appeal. The settlement includes the removal of any
    confidentiality clause in the proposed release that you sent to me.
    Thank you.
    Appellee’s App. at 254. Later that day, State Farm’s counsel responded to the
    email and stated: “State Farm agrees to remove the confidentiality paragraph.”
    
    Id. A minute
    later, Jonas’s counsel emailed a response and replied: “Fine.
    When can my client expect to be paid?” 
    Id. [9] On
    April 28, 2014, State Farm’s counsel sent an email to Jonas’s counsel,
    stating, “I received the settlement check from State Farm and I am putting it in
    the mail to you now. Attached is the Release that we agreed upon. Please have
    it executed and please file the dismissal pleadings with the 7th Circuit.” 
    Id. at 256.
    On April 29, Jonas’s counsel emailed a response and informed State Farm
    that Jonas was withdrawing from the agreed-upon settlement. 
    Id. at 259.
    Jonas
    pursued his appeal with the Seventh Circuit, which vacated the judgment of the
    District Court and remanded the case with instructions to dismiss for lack of
    subject matter jurisdiction.
    [10]   On April 13, 2015, Jonas filed a complaint against State Farm in Hamilton
    Superior Court, alleging that State Farm owed him interest and attorney fees
    and that State Farm committed bad faith and owed punitive damages. Jonas
    filed a motion for partial summary judgment, requesting judgment in his favor
    regarding his claim for interest and attorney fees. State Farm filed a
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016   Page 6 of 16
    counterclaim against Jonas, alleging that Jonas breached the terms of the
    settlement agreement and seeking enforcement of the agreement. State Farm
    filed a cross-motion for summary judgment, requesting judgment in its favor to
    enforce the terms of the settlement agreement. After a hearing on the motions,
    the trial court issued its findings of fact and conclusions thereon, granting
    summary judgment in favor of State Farm. Jonas now appeals.
    Discussion and Decision
    [11]   When reviewing the grant of summary judgment, our standard of review is the
    same as that of the trial court. FLM, LLC v. Cincinnati Ins. Co., 
    973 N.E.2d 1167
    , 1173 (Ind. Ct. App. 2012) (citing Wilcox Mfg. Grp., Inc. v. Mktg. Servs. of
    Ind., Inc., 
    832 N.E.2d 559
    , 562 (Ind. Ct. App. 2005)), trans. denied. We stand in
    the shoes of the trial court and apply a de novo standard of review. 
    Id. (citing Cox
    v. N. Ind. Pub. Serv. Co., 
    848 N.E.2d 690
    , 695 (Ind. Ct. App. 2006)). Our
    review of a summary judgment motion is limited to those materials designated
    to the trial court. Ind. Trial Rule 56(H); Missler v. State Farm, 
    41 N.E.3d 297
    ,
    301 (Ind. Ct. App. 2015). Summary judgment is appropriate only where the
    designated evidence shows there are no genuine issues of material fact and the
    moving party is entitled to judgment as a matter of law. T.R. 56(C). For
    summary judgment purposes, a fact is “material” if it bears on the ultimate
    resolution of relevant issues. 
    FLM, 973 N.E.2d at 1173
    . We view the pleadings
    and designated materials in the light most favorable to the non-moving party.
    
    Id. Additionally, all
    facts and reasonable inferences from those facts are
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016   Page 7 of 16
    construed in favor of the non-moving party. 
    Id. (citing Troxel
    Equip. Co. v.
    Limberlost Bancshares, 
    833 N.E.2d 36
    , 40 (Ind. Ct. App. 2005), trans. denied).
    [12]   A trial court’s grant of summary judgment is clothed with a presumption of
    validity, and the party who lost in the trial court has the burden of
    demonstrating that the grant of summary judgment was erroneous. 
    Id. Where a
    trial court enters specific findings and conclusions, they offer insight into the
    rationale for the trial court’s judgment and facilitate appellate review, but are
    not binding upon this court. 
    Id. We will
    affirm upon any theory or basis
    supported by the designated materials. 
    Id. [13] The
    party moving for summary judgment bears the initial burden to
    demonstrate the absence of any genuine issue of fact as to a determinative issue.
    Hughley v. State, 
    15 N.E.3d 1000
    , 1003 (Ind. 2014). The burden then shifts to
    the non-movant to present contrary evidence showing an issue for the trier of
    fact. 
    Id. “Although the
    non-moving party has the burden on appeal of
    persuading us that the grant of summary judgment was erroneous, we carefully
    assess the trial court’s decision to ensure that he was not improperly denied his
    day in court.” McSwane v. Bloomington Hosp. & Healthcare Sys., 
    916 N.E.2d 906
    ,
    909-10 (Ind. 2009) (internal quotation marks omitted).
    [14]   Jonas argues that the trial court erred in granting summary judgment in favor of
    State Farm. He asserts that the trial court erroneously found that there was a
    valid settlement agreement between him and State Farm because there was no
    meeting of the minds and the agreement was not in writing or signed by the
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016   Page 8 of 16
    parties. Jonas also contends that State Farm waived any argument that there
    was a settlement agreement when it failed to raise the issue to the Seventh
    Circuit. He further alleges that all matters of settlement discussion in the
    Seventh Circuit proceedings were confidential, and State Farm violated these
    provisions when it raised the settlement issue to the trial court. Additionally,
    Jonas argues that Texas law clearly granted him the full amount of damages he
    requested, and the trial court erred in not awarding him the 18% interest and
    attorney fees he requested.
    [15]   “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.” Sands v. Helen
    HCI, LLC, 
    945 N.E.2d 176
    , 180 (Ind. Ct. App. 2011) (citing Georgos v. Jackson,
    
    790 N.E.2d 448
    , 453 (Ind. 2003)), trans. denied. Settlement agreements are
    governed by the same general principles of contract law as other agreements.
    
    Id. Generally, a
    settlement agreement is not required to be in writing. 
    Id. The existence
    of a contract is a question of law, and the basic requirements of a
    contract are offer, acceptance, consideration, and “a meeting of the minds of
    the contracting parties.” Batchelor v. Batchelor, 
    853 N.E.2d 162
    , 165 (Ind. Ct.
    App. 2006). When determining if a contract is enforceable, we must consider
    two interrelated areas: intent to be bound and definiteness of terms. 
    Sands, 945 N.E.2d at 180
    . In order to render a contract enforceable, only the essential
    terms need be included. 
    Id. Whether the
    parties intended to execute a
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016   Page 9 of 16
    subsequent written document is relevant to the determination of intent to be
    bound. 
    Id. [16] An
    agreement to settle a claim in federal court is enforced just as any other
    contract. Dillard v. Starcom Int’l, Inc., 
    483 F.3d 503
    , 506 (7th Cir. 2007). State
    law governs whether a contract to settle a case was made. 
    Id. While some
    litigants believe that “they can change their mind at any time before they
    actually sign the settlement agreement[,] . . . that perception is often unfounded
    in the law.” Pohl v. United Airlines, Inc., 
    213 F.3d 336
    , 337 (7th Cir. 2000)
    (affirming district court’s enforcement of settlement agreement).
    [17]   Here, the following evidence was designated to the trial court by State Farm.
    On April 15, 2014, State Farm and Jonas, through his counsel, reached a verbal
    settlement agreement to settle all of Jonas’s claims for $60,000. State Farm
    then sent Jonas’s counsel a proposed Final Release Agreement that included a
    confidentiality provision. On April 21, 2014, Jonas’s counsel sent an email
    response objecting to the inclusion of the confidentiality provision. In the same
    email, however, counsel for Jonas stated: “As a result, if we do not have an
    agreement by the end of business today, we will withdraw our offer to settle . . .
    .   The settlement includes the removal of any confidentiality clause in the
    proposed release that you sent to me.” Appellee’s App. at 254. Later that same
    day, State Farm’s counsel responded to the email and stated that, “State Farm
    agrees to remove the confidentiality paragraph.” 
    Id. Jonas’s counsel
    responded
    one minute later, stating, “Fine. When can my client expect to be paid?” 
    Id. On April
    28, 2014, State Farm’s counsel emailed Jonas’s counsel, attached the
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016   Page 10 of 16
    agreed-upon Final Release Agreement without the confidentiality provision,
    and informed him that the settlement check had been received and would be
    placed in the mail. The next day, Jonas’s counsel emailed a response, advising
    State Farm that Jonas was withdrawing from the agreed-upon settlement.
    [18]   In his response to State Farm’s motion for summary judgment, Jonas stated
    that, “[d]uring the time of rejection and [State Farm’s] reconsideration, [Jonas]
    decided that the offer of settlement was not a good one for him and therefore
    rejected it totally.” Appellee’s App. at 260. In support of this, Jonas cited to his
    affidavit, where he averred, “[w]hile I initially thought that I would accept an
    amount, after State Farm’s counsel inserted new matters into what they termed
    a ‘settlement agreement,’ I reconsidered and rejected their proposal.” Appellee’s
    App. at 280-81. Jonas’s evidence, however, does not rebut any of the evidence
    designated by State Farm. Therefore, the evidence was undisputed that Jonas
    entered into a settlement agreement with State Farm and agreed to all of the
    terms of the Final Release Agreement. Jonas’s designated evidence does not
    dispute that his counsel had the authority to bind Jonas to the agreement. The
    evidence established that Jonas agreed to all of the terms of the settlement
    agreement, and the evidence he presented merely showed that he refused to
    follow through with the settlement, which is a breach of the settlement
    agreement. State Farm was therefore entitled to judgment as a matter of law,
    and the trial court did not err in granting summary judgment in its favor.
    [19]   Jonas also argues that the settlement agreement was not enforceable because
    Indiana law requires mediated settlement agreements to be in writing and
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016   Page 11 of 16
    signed by the parties, citing to Vernon v. Acton, 
    732 N.E.2d 805
    , 809 (Ind. 2000)
    (“[W]hen a settlement agreement is reached in mediation, the mediation rules
    required that it shall be reduced to writing and signed.”). However, at the time
    the settlement agreement was reached between Jonas and State Farm, there was
    no pending lawsuit between the parties in any Indiana state court. As our
    Supreme Court stated in Vernon, “[t]he A.D.R. Rules apply only to ‘all civil and
    domestic relations litigation filed’ in Indiana trial courts, subject to certain
    exceptions not relevant to this 
    case.” 732 N.E.2d at 810
    n.5 (quoting Ind.
    Alternative Dispute Resolution Rule 1.4). The Indiana Alternative Dispute
    Resolution Rules (“ADR rules”) did not apply to the settlement agreement
    reached between Jonas and State Farm, and therefore, the settlement agreement
    was not required to be in writing or signed by the parties to be enforceable.
    [20]   Jonas further contends that, pursuant to the ADR rules, communications
    during negotiations are to be kept confidential, and State Farm was not
    permitted to use the negotiations between it and Jonas as evidence. The above
    analysis applies equally to this argument. The Indiana ADR Rules do not
    apply to the settlement negotiations in this case as there was no pending case in
    Indiana state court at the time of the negotiations.1
    1
    Jonas also contends that all matters of settlement discussion in the Seventh Circuit proceedings were
    confidential and could not be used in any other litigation, citing to the Seventh Circuit’s website discussing its
    settlement conference program. However, Jonas did not argue that State Farm violated these confidentiality
    provisions to the trial court and did not designate any evidence to support such an argument. Our review of
    a summary judgment motion is limited to those materials designated to the trial court. Ind. Trial Rule 56(H).
    We, therefore, cannot look to such evidence in our review.
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016                           Page 12 of 16
    [21]   Jonas additionally contends that State Farm was barred from enforcing the
    settlement agreement because it did not raise the issue of the settlement
    agreement to the Seventh Circuit. He argues that State Farm has waived the
    issue of enforcing the settlement agreement because it failed to take action to
    enforce the settlement agreement during the proceedings in the Seventh Circuit,
    and because it did not do so, State Farm should be barred from enforcing the
    agreement now.2 In particular, Jonas points to an email from the “‘settlement
    group’ of the Seventh Circuit” that acknowledges that “there was never a
    settlement of this case, that State Farm would not pursue a breach of contract
    suit,” and that the appeal would continue with briefing. Appellant’s Br. at 10.
    [22]   In Herrnreiter v. Chicago Hous. Auth., 
    281 F.3d 634
    (7th Cir. 2002), the Seventh
    Circuit stated that “[a]n appeal continues until either (a) the litigants sign a
    mutually satisfactory written agreement that entails the dismissal of the appeal
    under [Federal Rule of Appellate Procedure] 42(b), or (b) the appellant actually
    files a notice of dismissal under Rule 
    42(b).” 281 F.3d at 637
    . Neither of these
    actions occurred here, or could have occurred, as State Farm was not the
    appellant in the Seventh Circuit. Therefore, State Farm had no choice at the
    2
    Jonas also argues that State Farm should be barred from arguing the issue of enforcing the settlement
    agreement due to claim preclusion. “Claim preclusion is applicable when a final judgment on the merits has
    been rendered and acts to bar a subsequent action on the same claim between the same parties.” TacCo
    Falcon Point, Inc. v. Atl. Ltd. P'ship XII, 
    937 N.E.2d 1212
    , 1218 (Ind. Ct. App. 2010). In the present case, the
    Seventh Circuit did not render a judgment on the merits of the case; instead, it vacated the judgment of the
    District Court and dismissed the case for lack of subject matter jurisdiction. As the Seventh Circuit did not
    reach a decision on the merits, it did not render a judgment that acts “to bar a subsequent action on the same
    claim between the same parties.” 
    Id. Court of
    Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016                          Page 13 of 16
    Seventh Circuit but to allow Jonas’s appeal to continue. Herrnreiter further
    states that, even if State Farm could not seek specific performance of the
    settlement agreement during appeal, it was not precluded from pursuing a suit
    for damages on the oral agreement. 
    Id. at 637-38.
    However, although “oral
    settlement agreements are enforceable . . . and may form the basis for
    recovery[,] . . . because settlement agreements are contracts, and thus governed
    by state law, those suits must occur in state court unless the parties are of
    diverse citizenship and the stakes exceed $75,000.” 
    Id. at 638.
    State Farm
    therefore could not file a separate case in federal court to enforce the settlement
    agreement because the amount in controversy would not be met. Even if State
    Farm had filed a case to enforce the settlement agreement in state court, the
    state court would have had no jurisdiction to interfere with the federal appeal. 3
    [23]   Even if the doctrine of waiver was applicable, waiver is an intentional
    relinquishment of a known right, which can be done expressly or impliedly.
    Westfield Nat’l Ins. Co. v. Nakoa, 
    963 N.E.2d 1126
    , 1132 (Ind. Ct. App. 2012),
    trans. denied. Jonas cites to an email from the Seventh Circuit mediator that
    stated, “State Farm will defend the appeal and not pursue a breach of contract
    action.” Appellant’s App. at 26. This email was sent to Jonas and his counsel,
    but not to State Farm’s counsel. Additionally, the email misstated State Farm’s
    3
    Jonas cites to Welty Bldg. Co. v. Indy Fedreau Co., LLC, 
    985 N.E.2d 792
    (Ind. Ct. App. 2013) for his argument
    that State Farm waived its right to seek enforcement of the settlement agreement. That case, however, did
    not involve a question of enforcement of a settlement agreement; instead, it involved whether a party could
    waive a contractual right to arbitrate a matter after that party had filed a lawsuit for breach of that contractual
    agreement.
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016                            Page 14 of 16
    position. That is, in an email sent to the Seventh Circuit mediator from State
    Farm prior to the one sent to Jonas, State Farm stated, “State Farm has
    authorized us to instruct you that it will proceed with the appeal in response to .
    . . Jonas’s decision to not follow through with the settlement agreement.”
    Appellee’s App. at 295. That email from State Farm to the Seventh Circuit did
    not state that State Farm was not pursuing a breach of contract action.
    Therefore, we find that State Farm did not expressly relinquish its right to
    enforce the settlement agreement. The evidence also does not support an
    implied waiver as State Farm did not take any litigation action consistent with a
    waiver of its right. Jonas was the appellant in the Seventh Circuit, and when he
    made the decision to pursue an appeal, State Farm had to defend itself in the
    appeal.
    [24]   We, therefore, conclude that no genuine issue of material fact exists as to
    whether a valid settlement agreement existed between State Farm and Jonas
    and as to whether Jonas breached this settlement agreement. Consequently
    State Farm is entitled to judgment as a matter of law to enforce the settlement
    agreement. The trial court did not err in granting summary judgment in favor
    of State Farm.4
    4
    In his Appellant’s Brief, Jonas makes a lengthy argument that, under Texas law, he was entitled to the full
    amount of damages he requested, including penalty interest and attorney fees and relies heavily on the
    Seventh Circuit decision. However, the Seventh Circuit’s decision’s relevant holding was that the “judgment
    of the district court is vacated, and the case is remanded with instructions to dismiss for lack of subject matter
    jurisdiction.” State Farm Life Ins., Co. v. Jonas, 
    775 F.3d 867
    , 870 (7th Cir. 2014). When a federal court lacks
    jurisdiction, it cannot proceed to determine the merits of the case. Steel Co. v. Citizens for a Better Env’t, 
    523 U.S. 83
    , 94 (1998). Therefore, the Seventh Circuit’s decision could not, and did not, reach the merits of
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016                           Page 15 of 16
    [25]   Affirmed.
    [26]   Mathias, J., and Brown, J., concur.
    whether Jonas was entitled to penalty interest or attorney fees under Texas law. Further, because we have
    determined that Jonas breached an enforceable settlement agreement, we are not required to further analyze
    Jonas’s arguments as to why he believes he is entitled to interest and attorney fees under Texas law.
    Court of Appeals of Indiana | Opinion 29A02-1510-PL-1761 | March 30, 2016                     Page 16 of 16