Warren Roberts v. Pacific Spine Specialists

FILED
NOT FOR PUBLICATION
DEC 18 2017
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
WARREN G. ROBERTS, M.D., No. 15-35943
F.A.A.N.S., an individual; ASPEN SPINE
AND NEUROSURGERY CENTER, P.C., D.C. No. 3:13-cv-01136-SI
an Oregon professional corporation,
Plaintiffs-counter- MEMORANDUM*
defendants-Appellants,
v.
PACIFIC SPINE SPECIALISTS, LLC, an
Oregon limited liability company;
TIMOTHY L. KEENAN, M.D.; ROBERT
L. TATSUMI, M.D.,
Defendants-Appellees,
LEGACY MERIDIAN PARK
HOSPITAL, INC., DBA an Oregon non-
profit corporation, an Oregon non-profit
corporation; ANDREW B. CRAMER, Dr.;
NORTHWEST NEUROSURGICAL
ASSOCIATES, LLC, an Oregon limited
liability company; FRANCISCO X.
SOLDEVILLA, M.D.,
Defendants-counter-
claimants-Appellees.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Appeal from the United States District Court
for the District of Oregon
Michael H. Simon, District Judge, Presiding
Argued and Submitted November 6, 2017
Portland, Oregon
Before: FERNANDEZ and W. FLETCHER, Circuit Judges, and TIGAR,** District
Judge.
Appellants Dr. Warren Roberts and Aspen Spine and Neurosurgery Center
(“Roberts”) appeal the district court’s order enforcing a “walkaway” settlement of
the litigation without compensation to any party. Roberts contends that he revoked
his lawyer’s authority to settle the case on those terms before Appellees accepted
the settlement offer. We have jurisdiction pursuant to 28 U.S.C. § 1291 and we
affirm.
Roberts acknowledges that on October 17, 2014, he gave his attorney, Mark
McDougal, authority to enter into a settlement dismissing all claims without
compensation.1 Roberts argues, however, that he revoked McDougal’s settlement
authority in a October 20, 2014 email stating,“I have now had a bit more time to
consider case options. I would like to speak with you about case abatement. Let
**
The Honorable Jon S. Tigar, United States District Judge for the
Northern District of California, sitting by designation.
1
Before the district court, Roberts contended that he had not given such
authority, but he has abandoned this argument on appeal.
2
me know a good time that works for you. Please do not dismiss case until we have
a chance to discuss this.”2
We need not decide whether the email revoked McDougal’s settlement
authority because Appellees were entitled to accept the offer in any event. Roberts
does not argue that any revocation or modification of the offer was communicated
to Appellees before their acceptance. At the time McDougal extended the
settlement offer, he had Roberts’ actual authority. At the time Appellees accepted
the offer, they had no reason to believe that McDougal had lost his authority to
deal on Roberts’ behalf, and they were therefore entitled to deliver their
acceptances to him. Restatement (Third) of Agency § 3.11 (2006) (“Apparent
authority ends when it is not longer reasonable for the third party with whom an
agent deals to believe that the agent continues to act with actual authority.”). In
other words, even if McDougal’s actual authority was terminated by the October
20, 2014 email, his apparent authority was unaffected. Id. All of the Appellees
accepted the settlement offer before they had any indication that the offer had been
withdrawn. At that point, the parties reached a binding settlement agreement.
2
We reject Appellees’ argument that this argument was not preserved for
appeal. Roberts raised the argument before the district court.
3
Roberts argues that Appellees’ counsel were not entitled to assume that
McDougal had Roberts’ authority to receive Appellees’ acceptances because
Oregon law “has long placed the burden on attorneys to inquire and discern the
extent of their counterparts’ authority in settlement negotiations,” citing Galbraith
v. Monarch Gold Dredging Co., 84 P.2d 1110, 1115 (1938). Galbraith does not
help Roberts. In that case, a defendant’s attorney entered into a confession of
judgment in the full amount sought by the plaintiff. Id. at 1110-11. The court set
aside the judgment on the ground that defendant had not consented to the
judgment. Id. at 1115-16. Defendant had never given such consent, and plaintiff
was aware that defendant not only did not consent, but actively objected to the
proposed settlement. Id. at 1114. Here, by contrast, it is not disputed that Roberts
authorized McDougal to offer a walkaway settlement to Appellees at the time the
offer was made. Appellees were entitled to rely on that offer, and did so. There is
no rule, located in Galbraith or otherwise, imposing a duty on Appellees to
ascertain McDougal’s authority before each subsequent communication with him.
AFFIRMED.
4