RANDY POSTMA and CARY, LLC v. CHRISTOPHER BAKER, PATRICIA BAKER and TRICIA'S PLACE, LLC

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
RANDY POSTMA and CARY, LLC,
Appellants,
v.
CHRISTOPHER BAKER, PATRICIA BAKER
and TRICIA’S PLACE, LLC,
Appellees.
No. 4D18-3232
[July 31, 2019]
Appeal from the Circuit Court for the Seventeenth Judicial Circuit,
Broward County; Carlos A. Rodriguez, Judge; L.T. Case No.
062017CA008716AXXXCE.
John J. Shahady of Shahady & Wurtenberger P.A., Fort Lauderdale, for
appellants.
Eric J. Horbey of Lazer, Aptheker, Rosella & Yedid, P.C., West Palm
Beach, for appellees.
KUNTZ, J.
In this appeal, we must interpret language in a settlement agreement
allowing a party to inspect a vehicle to “make sure the vehicle is to his
satisfaction.” The appellant, who had the right to inspect, argues the
provision allowed him to inspect the vehicle and determine whether he was
satisfied before purchasing the vehicle. The circuit court disagreed. We
reverse.
Background
In 2014, Christopher Baker, Patricia Baker, and Tricia’s Place LLC
bought a 2003 Marathon Prevost, a motorcoach, from Randy Postma and
Cary LLC for $365,000. 1 The Bakers allege that when they purchased the
motorcoach, Postma stated that it had never been “wrecked.”
1 We call the appellants Postma, and the appellees the Bakers.
Later, the Bakers learned that the motorcoach had been in an accident
and had been issued a salvage title. As a result, the Bakers filed a lawsuit,
alleging that Postma knew of the accident and misrepresented the
motorcoach’s condition.
At mediation, the parties signed a confidential settlement agreement.
The handwritten agreement stated that Postma would pay $315,000 to
repurchase the motorcoach. It also included a provision allowing Postma
to inspect the motorcoach:
Prior to purchase, Postma has the right to inspect the vehicle
and make sure the vehicle is to his satisfaction. Inspection
will take place within 30 days.
Weeks later, the Bakers moved to enforce the agreement, arguing that
Postma inspected the motorcoach after the mediation and told them it
“was in very good condition.” They also explained that they understood
the settlement agreement to mean that Postma was “to come out and see
the conditions of [the motorcoach] and make sure it wasn’t damaged or
wrecked or dented.”
Postma explained that he sold the motorcoach to the Bakers in 2014,
when it had 76,000 miles on it. At mediation, he learned that the Bakers
had driven the motorcoach 40,000 additional miles since they bought it
from him. So he agreed to purchase the motorcoach subject to his right
to inspect it. At the inspection, Postma allegedly found many issues and
declined to complete the purchase.
The circuit court granted the Bakers’ motion to enforce settlement. The
court noted that the parties entered into a voluntary settlement early in
the litigation. The court found that Postma “ask[ed] the Court to interpret
‘to his satisfaction’ as completely discretionary with [Postma]. Such an
interpretation,” the court found, “would render the settlement agreement
completely illusory.” The court held the Bakers complied with the
settlement agreement and granted their motion to enforce it.
Analysis
Postma argues the court erred in concluding the inspection clause in
the settlement agreement was not a condition precedent to enforcing the
agreement. The Bakers respond that the inspection clause was limited to
confirming the representations the Bakers made about the motorcoach at
mediation. We agree with Postma and reverse.
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The Bakers state that “[n]owhere do Appellants present any evidence
that demonstrates that the trial court’s determination as to the meaning
of the inspection clause was clearly erroneous,” and argue that we should
affirm unless the circuit court’s ruling was clearly erroneous. But
“settlement agreements are contractual in nature, [and] are interpreted
and governed by contract law.” Barone v. Rogers, 930 So. 2d 761, 763–64
(Fla. 4th DCA 2006) (citation omitted). So, as with contracts, our review
is de novo. Renny v. Bertoloti, 252 So. 3d 761, 765 (Fla. 4th DCA 2018)
(citation omitted).
If the language of a settlement agreement is clear and unambiguous,
“courts may not indulge in construction or modification and the express
terms of the settlement agreement control.” Commercial Capital Res., LLC
v. Giovannetti, 955 So. 2d 1151, 1153 (Fla. 3d DCA 2007) (quoting Sec.
Ins. Co. of Hartford v. Puig, 728 So. 2d 292, 294 (Fla. 3d DCA 1999)).
The Bakers argue that the language allowing Postma to inspect the
vehicle to “make sure the vehicle is to his satisfaction” did not allow him
to reject the vehicle based on his “dissatisfaction.”
But their argument is contrary to the clear and unambiguous language.
The settlement agreement allowed Postma the right to inspect the
motorcoach to “make sure the vehicle is to his satisfaction.” This provision
created a condition precedent to Postma’s obligation to repurchase the
motorcoach. See, e.g., Land Co. of Osceola Cty., LLC v. Genesis Concepts,
Inc., 169 So. 3d 243, 247 (Fla. 4th DCA 2015) (citations omitted).
Alternatively, the Bakers argue that even if Postma could reject the
motorcoach based on dissatisfaction, the rejection needed to be “‘genuine’
and in ‘good faith.’” See, e.g., Burger King Corp. v. Austin, 805 F. Supp.
1007, 1014 (S.D. Fla. 1992) (“Florida would conclude . . . that ‘a party
vested with contractual discretion must exercise that discretion
reasonably and with proper motive, and may not do so arbitrarily,
capriciously, or in a manner inconsistent with the reasonable expectations
of the parties.’” (quoting Dayan v. McDonald’s Corp., 466 N.E.2d 958, 972
(Ill. App. Ct. 1984))).
But we need not decide that issue, as the circuit court did not conclude
Postma failed to act in good faith. Instead, the court found the inspection
was limited to confirming the Bakers accurately described the condition of
the motorcoach at mediation.
Postma exercised his right to inspect and determined the motorcoach
was not to his satisfaction. Because he determined it was not to his
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satisfaction, he did not breach the agreement and the court erred in
granting the motion to enforce.
Conclusion
The court’s order enforcing the settlement agreement is reversed, and
the case is remanded for further proceedings.
Reversed and remanded.
LEVINE, C.J., and DAMOORGIAN, J., concur.
* * *
Not final until disposition of timely filed motion for rehearing.
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