Aker, W. v. Saunders, Q. ( 2019 )

J-S53033-19
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
WYATT AKER : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
:
v. :
:
:
QUABEER SAUNDERS AND : No. 426 EDA 2019
SUPERIOR COMFORT COMPANY :
SUPERIOR COMFORT HEATING AND :
COOLING, LLC AND SUPERIOR :
COMFORT PRODUCTS AND :
COMITALE NATIONAL :
DISTRIBUTORS, LLC A/K/A AND :
D/B/A SUPERIOR COMFORT :
PRODUCTS AND SUPERIOR :
COMFORT LLC AND SUPERIOR :
COMFORT LIMITED LIABILITY :
COMPANY
Appeal from the Order Entered December 31, 2018
In the Court of Common Pleas of Philadelphia County Civil Division at
No(s): February Term 2018 01019
BEFORE: OLSON, J., STABILE, J., and NICHOLS, J.
MEMORANDUM BY NICHOLS, J.: FILED NOVEMBER 04, 2019
Appellant Wyatt Aker appeals from the order granting the motion to
enforce settlement agreement filed by Appellees Quabeer Saunders and
Superior Comfort Company, Superior Comfort Heating and Cooling, LLC, and
Superior Comfort Products and Comitale National Distributors, LLC a/k/a and
d/b/a Superior Comfort Products and Superior Comfort LLC and Superior
Comfort Limited Liability Company. Appellant argues that (1) the settlement
and release were defective; (2) he rescinded the release one day after its
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execution; (3) the trial court should have conducted an evidentiary hearing to
develop the record; (4) Appellees failed to comply with Pa.R.C.P. 1030; and
(5) Appellees’ insurance carrier failed to satisfy its obligation of fair dealing.
We affirm.
The relevant facts and procedural history of this appeal are as follows.
This matter arises from a car accident Appellant was allegedly
injured in on February 13, 2016. On December 9, 2016, Appellant
settled with Appellee[s]. Appellant signed a release in exchange
for $12,855.00. [Specifically, the release discharged Appellees
Superior Comfort and Quabeer Saunders and their associates from
all claims related to the motor vehicle accident.] Appellant’s
[prior] attorney faxed a letter to Appellee[s’] insurance company,
with the signed release of liability attached, and asked the
insurance company to forward her a check for the settlement
amount. The next day, December 10, 2016, Appellant’s [prior]
attorney contacted the insurance company by telephone and
advised that Appellant wished to rescind the release. [In
response, Appellees’ insurance company stopped payment on the
check. New counsel] filed a writ of summons [on Appellant’s
behalf] on February 13, 2018. Appellant then filed a complaint on
August 15, 2018. Appellee filed a motion to enforce settlement
agreement on November 15, 2018. [On December 5, 2018,
Appellant filed a response in opposition to Appellees’ motion. The
trial] court entered an order granting Appellee[s’] motion on
December 31, 2018.
On January 28, 2019, Appellant filed a notice of appeal from [the
trial] court’s December 31, 2018 order. On January [30], 2019,
[the trial] court ordered Appellant to file a concise statement of
matters complained of on appeal pursuant to Pa.R.A.P. 1925(b)
within twenty-one days. Appellant filed a timely [Rule 1925(b)
statement] on February 19, 2019.
Trial Ct. Op., 4/15/19, at 1-2 (some capitalization omitted).
The trial court filed a responsive opinion on April 15, 2019. The trial
court concluded that (1) the issuance of settlement funds to Appellant’s
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attorney as his fiduciary did not render the settlement defective; (2)
Pennsylvania law does not require that the execution of a release be witnessed
or notarized to be enforceable; (3) although Appellant purported to rescind
his assent to the release, there was no fraud or other circumstances
warranting rescission; (4) Rule 1030 did not apply to Appellees’ motion to
enforce settlement; (5) an evidentiary hearing was not necessary to
determine whether the settlement agreement was binding under the
circumstances of this case; and (6) Appellant failed to substantiate his claim
that Appellees’ insurance carrier failed in its obligation of fair dealing.
Appellant now raises six issues for our review, which we have reordered
as follows:
1. The court erred or abused its discretion [in] not finding that
the settlement was defective because [Appellees’] insurer’s
settlement check was made payable to [Appellant’s] prior
attorney only and not to [Appellant] and his attorney.
2. The court erred or abused its discretion in not finding that
the Release was defective.
3. The court erred or abused its discretion in not finding that
the Release was rescinded and said rescission was ratified
by [Appellees’] insurance company.
4. The court erred or abused its discretion by not holding an
evidentiary hearing.
5. The court erred or abused its discretion in not finding
[Appellees] failed to plead an Answer or New Matter
containing the affirmative defense of “Release.”
6. The court erred or abused its discretion in not finding
[Appellees’] insurance carrier failed in its obligation of fair
dealing with [Appellant].
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Appellant’s Brief at 5-6.1
In support of his first two issues, Appellant claims that various defects
invalidated the settlement agreement. Id. at 12-13. Specifically, Appellant
alleges that Appellees’ insurance carrier made the settlement check payable
to Appellant’s prior attorney without including Appellant’s name on the check.
Id. at 12. Appellant argues that a settlement check “must be made out to
both plaintiff and his counsel,” and the settlement check here “was void on its
face.” Id.
Appellant also asserts that the release “included signature lines for two
witnesses and a notary.” Id. at 13. Appellant insists, however, that no one
actually witnessed the execution or notarization of the release, because the
signature lines for the witnesses are blank. Id. Appellant cites Shovel
Transfer & Storage, Inc. v. Pa. Liquor Control Bd., 739 A.2d 133, 136
(Pa. 1999), for the proposition that, generally, “signatures are not required
unless such signing is expressly required by law or by the intent of the
parties.” Id. (emphasis omitted). In light of these omissions, Appellant
concludes that the trial court erred in not finding that the release was
defective. Id.____________________________________________
1 Although Appellant’s statement of the questions involved presents six issues
for our review, Appellant’s argument section is divided into two parts. See
Pa.R.A.P. 2119(a) (stating that the argument shall be divided into as many
parts as there are questions to be argued). Appellant acknowledges this
discrepancy, claiming that “[s]ince the issues are intertwined, it is difficult to
segregate the issues.” Appellant’s Brief at 12. Nevertheless, we will address
each of the six claims independently.
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“The enforceability of settlement agreements is determined according
to principles of contract law. Because contract interpretation is a question of
law, this Court is not bound by the trial court’s interpretation.” Step Plan
Servs., Inc. v. Koresko, 12 A.3d 401, 408 (Pa. Super. 2010) (citation
omitted).
Our standard of review over questions of law is de novo and to
the extent necessary, the scope of our review is plenary as [the
appellate] court may review the entire record in making its
decision. With respect to factual conclusions, we may reverse the
trial court only if its findings of fact are predicated on an error of
law or are unsupported by competent evidence in the record.
Id. (citations and quotation marks omitted).
“There is a strong judicial policy in favor of voluntarily settling lawsuits.
The primary reason that settlement is favored is that it expedites the transfer
of money into the hands of a complainant. Further, settlement reduces the
burden on and expense of maintaining courts.” Felix v. Giuseppe Kitchens
& Baths, Inc., 848 A.2d 943, 946 (Pa. Super. 2004) (citations omitted).
In a settlement agreement, “[t]here is an offer (the settlement figure),
acceptance, and consideration (in exchange for the plaintiff terminating his
lawsuit, the defendant will pay the plaintiff the agreed upon sum).” Step Plan
Servs., 12 A.3d at 409 (citation omitted). “As with any contract, it is essential
to the enforceability of a settlement agreement that the minds of the parties
should meet upon all the terms, as well as the subject-matter, of the
agreement.” Mazzella v. Koken, 739 A.2d 531, 536 (Pa. 1999) (citation and
internal alterations omitted).
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“It is well settled that the fundamental rule in contract interpretation is
to ascertain the intent of the contracting parties. When the words of a contract
are clear and unambiguous, the intent of the parties is to be discovered from
the express language of the agreement.” Hornberger v. Dave Gutelius
Excavating, Inc., 176 A.3d 939, 944 (Pa. Super. 2017) (citations and
internal alterations omitted). “If parties agree upon essential terms and
intend them to be binding, a contract is formed even though they intend to
adopt a formal document with additional terms at a later date.” Compu
Forms Control, Inc. v. Altus Grp., Inc., 574 A.2d 618, 622 (Pa. Super.
1990) (internal quotation marks and citations omitted); see also Step Plan
Servs., 12 A.3d at 409 (stating that “[w]here a settlement agreement
contains all of the requisites for a valid contract, a court must enforce the
terms of the agreement” (citation omitted)).
Instantly, Appellant does not cite any authority to support his argument
that a settlement check must be made out to both the plaintiff and his counsel.
Further, in response to Appellees’ motion to enforce settlement, Appellant
acknowledged that it is a matter of “practice” for a check to be made payable
to the plaintiff and counsel, rather than something that is mandated by case
law, statute, or rule of court. See Resp. to Mot. to Enforce Settlement,
12/6/18, at ¶ 4.
Regarding the two blank lines on the release for witness signatures, the
release did not contain language mandating that witnesses be present for the
execution of the document. Rather, the “certificate of witnesses” section of
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the release merely states, “We certify that this release was signed in our
presence by the above who acknowledged that he/they understood it fully.”
Mot. to Enforce Settlement, 11/15/18, at Ex. A. Additionally, despite the blank
lines for the witness signatures, the release includes a notary’s signature and
seal, confirming that Appellant “personally appeared” and executed the
release in the notary’s presence. Id.Significantly, the defects alleged by Appellant do not establish that he
was somehow unaware of the material terms of the settlement agreement or
that the parties did not come to a meeting of the minds for all material terms.
See Mazzella, 739 A.2d at 536. Appellant’s reliance on Shovel Transfer &
Storage also merits no relief, as that case addressed the necessity of the
signatures of a party to the contract as opposed to a witness. See Shovel
Transfer & Storage, 739 A.2d at 137 (acknowledging that “[w]here the
written agreement contains the names of certain persons as parties, and one
or more do not sign while others do, the question of whether those who sign
are bound is to be determined by the intention and understanding of the
parties” (citation omitted)); see also Leyda v. Norelli, 564 A.2d 244, 245
(Pa. Super. 1989) (holding that that the failure to notarize a release, which
expressly provided that a notary public explain the “nature and legal effect”
of the document, did not invalidate the release; the parties seeking damages
signed the release, the signatures were viewed by a single witness, and the
release affirmed that the signatories “carefully read the foregoing release and
know the contents thereof, and we sign the same as of our own free acts”).
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Therefore, the trial court properly determined that the parties agreed
upon the essential terms, and the settlement agreement was enforceable.
See Step Plan Servs., 12 A.3d at 408. Accordingly, Appellant’s first two
issues fail.
In his third and fourth issues, Appellant contends that he rescinded his
acceptance of the release when he “notified Appellee[s] one day after signing
an incomplete release.” Appellant’s Brief at 19 (emphasis in original).
Appellant insists that “[t]here was either a mutual assent to rescind . . . or a
unilateral rescission” where Appellees’ insurance company stopped payment
on the settlement check. Id. at 20. Moreover, Appellant claims that
“Appellee[s] clearly assented to this rescission [due to] the fact that [they]
did not file a motion to enforce settlement for nearly two years.” Id. at 15.
Appellant also suggests that, “[a]t the very least, the validity of the
release should be subject to an evidentiary hearing.” Id. at 22. Appellant
emphasizes “that an evidentiary hearing into the existence and binding effect
of the settlement agreement is the appropriate procedure to be followed in
matters of contested settlement agreements.” Id. at 17 (citing Limmer v.
Country Belle Co-op Farmers, 286 A.2d 669 (Pa. Super. 1971)). Appellant
maintains that the validity of the settlement agreement remains contested in
this case, where the parties dispute the effectiveness of Appellant’s purported
rescission. Id. Moreover, Appellant contends that the trial court “drew
conclusions which were not warranted by the uncontested facts, i.e., fraud or
the absence thereof.” Id. at 19.
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Appellant concludes that the parties effectively rescinded the release,
and the trial court erred in granting Appellees’ motion to enforce the
settlement agreement. Id. at 26. In the alternative, Appellant requests that
this Court remand the matter for an evidentiary hearing regarding the
propriety of the settlement agreement. Id.
“Rescission, an equitable remedy, involves a disaffirmance of the
contract and a restoration of the status quo.” Umbelina v. Adams, 34 A.3d
151, 157 (Pa. Super. 2011) (citation omitted). “Contract rescission is
permitted only in limited circumstances. First, a contract can be repudiated
by mutual agreement of all parties to it.” In re Bridgeport Fire Litig., 8
A.3d 1270, 1282 (Pa. Super. 2010) (citation omitted); see also In re
Roberts’ Estate, 112 A.2d 394, 396 (Pa. 1955) (explaining that “[o]ne party
to a contract cannot force rescission on the other parties thereto, and the
mere failure to object to repudiation . . . is not a manifestation of assent”
(citation omitted)).
“A contract can also be avoided if it was procured by fraud or
misrepresentation that has been relied upon by the party seeking to rescind
the instrument.” Bridgeport Fire Litig., 8 A.3d at 1282 (citation omitted);
see also Umbelina, 34 A.3d at 158 (stating that “the only grounds upon
which equity will permit rescission of an executed contract are fraud, mistake,
failure of consideration, and quia timet” (citations omitted)). “Our courts have
ruled that executed contracts cannot be rescinded or annulled in the absence
of a showing [of] fraud or mistake simply because a party found the contract
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to be burdensome or a financial failure.” Umbelina, 34 A.3d at 160 (citation
omitted).
Regarding the need for an evidentiary hearing on a motion to enforce a
settlement agreement, this Court has stated:
Where the pleading raises an issue of fact relative to a purported
settlement, the trial court must conduct an evidentiary hearing;
and where the court fails to do so, its failure is not waived by a
party’s failure to object. The court may be required to determine
if an offer to settle was tendered, if it was accepted, if counsel had
authority to act, the terms of the settlement and possibly other
matters.
Christian v. Allstate Ins. Co., 502 A.2d 192, 194 (Pa. Super. 1985). “We
decline to impose such an obligation upon the trial court, however, if it is not
apparent from the record that the court was informed of the existence of
disputed issues concerning the settlement.” City of Carbondale v. Pa. Ins.
Guar. Ass’n, 636 A.2d 669, 671 (Pa. Super. 1994).
Instantly, Appellees’ motion to enforce settlement described the events
following Appellant’s execution of the release as follows:
6. [Appellant’s prior counsel] advised [Appellees’ insurance
company] over the telephone on December 10, 2016 that
[Appellant] was not happy with the settlement agreement
and wanted to rescind the offer and void the signed release.
7. [Appellees’ insurance company] stopped payment on the
check and the check for $12,855.00 was never cashed.
Mot. to Enforce Settlement at ¶¶ 5-7 (emphasis added). Importantly,
Appellant admitted these averments were true in his response to Appellees’
motion. See Resp. to Mot. to Enforce Settlement at ¶¶ 6-7. The trial court
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subsequently reviewed the parties’ filings and concluded that “Appellant
cannot claim the release and settlement agreement are defective because he
is now unhappy with the terms he bound himself to.” Trial Ct. Op. at 3.
Here, Appellant has failed to demonstrate that Appellees mutually
assented to the rescission merely because they waited two years to file the
motion to enforce settlement. See Roberts’ Estate, 112 A.2d at 396. To
the extent Appellant relies on the insurance company’s decision to stop
payment on the settlement check, we emphasize that the insurance company
was not a party to the case, and the record does not support the conclusion
that Appellees themselves actually assented to rescission. See Bridgeport
Fire Litig., 8 A.3d at 1282. Further, Appellant does not argue that some type
of fraud or misrepresentation existed to support his unilateral rescission.2 Id.On this record, Appellant cannot rescind the executed release simply
because he changed his mind about the desirability of the terms of the
settlement agreement. See Umbelina, 34 A.3d at 160. Further, the trial
court did not err in refusing to conduct an evidentiary hearing where the
record does not demonstrate any dispute about the existence of an
agreement. See City of Carbondale, 636 A.2d at 671. Therefore, Appellant
is not entitled to relief on his third and fourth issues.
____________________________________________
2 Rather than asserting fraud or misrepresentation, Appellant claimed that he
“did not understand that the settlement would not cover all of his losses
because he had not recovered from his personal injuries and had outstanding
bills” when he signed the release. See Resp. to Mot. to Enforce Settlement at
¶ 10.
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In his fifth issue, Appellant cites Rule 1030 for the proposition that the
affirmative defense of “release” must be pled in a responsive pleading under
the heading “new matter.” Appellant’s Brief at 21. Appellant baldly asserts
that Appellees “failed to plead the affirmative defense of ‘release’ pursuant to
[Rule] 1030,” and the trial court erred in determining that Appellees did not
need to comply with Rule 1030. Id. at 20.
Rule 1030 provides, in pertinent part, as follows:
Except as provided by subdivision (b), all affirmative defenses
including but not limited to the defenses of . . . release . . . shall
be pleaded in a responsive pleading under the heading “New
Matter”. A party may set forth as new matter any other material
facts which are not merely denials of the averments of the
preceding pleading.
Pa.R.C.P. 1030(a). “Under the Rule, if release is not pled as new matter, the
right to assert the defense has been waived. Nevertheless, our Rules of Civil
Procedure must be liberally construed so that actions are resolved in a just,
speedy and inexpensive manner consistent with [Pa.R.C.P.] 126.”
Blumenstock v. Gibson, 811 A.2d 1029, 1039 (Pa. Super. 2002) (citations
omitted).
Instantly, the trial court correctly noted that Rule 1030 applies to
responsive pleadings. See Trial Ct. Op. at 4; see also Pa.R.C.P. 1017 (listing
the pleadings that parties may file in a civil action). Appellees, however, did
not file a responsive pleading to Appellant’s complaint. Rather, Appellees filed
a motion to enforce settlement. See Camp Horne Self Storage LLC v.
Lawyers Title Ins. Corp., 150 A.3d 999, 1002 (Pa. Super. 2016) (stating
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that Pa.R.C.P. “229.1 confers authority on trial courts to, among other things,
enforce settlement agreements so long as the underlying cause of action has
not been discontinued”); see also Pa.R.C.P. 208.1 (explaining that, generally,
a motion is “any application to the court for an order made in any civil action
or proceeding”).
Here, the trial court had authority to address the motion to enforce
settlement, as the underlying cause of action was active when Appellees filed
their motion. See Camp Horne Self Storage, 150 A.3d at 1002. Moreover,
Appellant did not lack notice about the release, which he admitted to signing.
See Resp. to Mot. to Enforce Settlement at ¶ 5. Therefore, to the extent Rule
1030 may be applicable, Appellant’s rights were not prejudiced by Appellees’
failure to plead the defense of release prior to filing the motion to enforce
settlement. See Blumenstock, 811 A.2d at 1039 (holding that the trial court
need not strictly enforce Rule 1030 where the rights of the plaintiff are not
prejudiced). Accordingly, Appellant is not entitled to relief on his fifth issue.
In his sixth issue, Appellant claims that the trial court erred in not finding
that Appellees’ insurance carrier failed in its obligation of fair dealing with
Appellant. Appellant’s entire argument on this issue consists of the following
sentence: “Furthermore, [Appellees’ insurance carrier] is under an obligation
of fair dealing to [Appellant] pursuant to the insurance statutes of
Pennsylvania.” Appellant’s Brief at 25-26. Absent additional argument or any
citations to relevant authority, Appellant’s underdeveloped claim is waived.
See Umbelina, 34 A.3d at 161 (explaining that “[w]here an appellate brief
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fails to provide any discussion of a claim with citation to relevant authority or
fails to develop the issue in any other meaningful fashion capable of review,
that claim is waived” (citations omitted)). Accordingly, we affirm the order
granting Appellees’ motion to enforce settlement agreement.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 11/4/19
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