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Dern v. Liberty Mutual Insurance Co.

United States District Court, D. Maryland, Southern Division

May 22, 2017

JANE DERN, Plaintiff,


          GEORGE J. HAZEL United States District Judge

         Plaintiff originally initiated this case against Defendant Liberty Mutual Insurance Company alleging breach of an insurance contract. See ECF No. 2: ECF No. 23. The case was eventually closed pursuant to a settlement agreement. ECF No. 35. Now pending before the Court is Plaintiffs Motion to Reopen Case, ECF No. 44, Defendant's Motion to Enforce the Settlement Agreement, ECF No. 41, a Motion to Withdraw as Attorney by Plaintiffs Counsel, ECF No. 40, and Defendant's Motion to Seal Defendant's Opposition to Plaintiffs Motion to Withdraw Settlement Claim, ECF No. 42. No hearing is necessary. See Loc. R. 105.6 (D. Md. 2016). For the following reasons. Plaintiffs Motion to Reopen Case is denied. Defendant's Motion to Enforce the Settlement Agreement is granted, the Motion to Withdraw as Attorney is granted, and the Motion to Seal is denied.

         I. BACKGROUND

         Plaintiff Jane Dern brought suit against Defendant Liberty Mutual Insurance Co. after her home, which was insured by Defendant, was damaged in a fire on May 22, 2014. See ECF No. 2. Dern alleged that "despite [her] good-faith efforts to resolve the matter. . . Defendant[] h[as] refused to move forward in good faith and h[as] continually pressured the Plaintiff to sign paperwork and settle the claim in such a way that would not appropriately cover the work that needs to be done . . ." Id. ¶ 8. Plaintiff brought claims for unfair claims settlement practices and breach of contract. Id. at 2-4.[1]In a Memorandum Opinion and Order dated December 11, 2015. the Court dismissed Count I with prejudice, but allowed Plaintiff to amend her Complaint with respect to Count II. Plaintiff filed an Amended Complaint on January 11, 2016. ECF No. 23.

         The Court issued an Order referring the case to Magistrate Judge Charles B. Day on July 25. 2016. ECF No. 33. A settlement conference was held on October 7, 2016. and following that settlement conference, the Court issued an Order dismissing the case and stating that "[t]his Court has been advised by the parties that the above action has been settled . . . The entry of this Order is without prejudice to the right of a party to move for good cause within 30 days to reopen this action if settlement is not consummated." ECF No. 35. On October 21. 2016. Dern filed correspondence with the Court, requesting to withdraw the settlement. ECF No. 36. Dern stated: "I'm requesting that the settlement claim I signed be withdrawn on the grounds of my complaint not being presented in full and my law[y]er not providing the courts with all the information to help my case accordingly and sufficiently." Id. She further stated that her attorney was "not being forthcoming on the information I have provided him with." Id[2]Plaintiffs attorney. Thomas McManus filed a Motion to Withdraw as Attorney on November 3, 2016. ECF No. 40. Dern moved to reopen the case on November 14, 2016, based upon the reasons stated in her October 21. 2016 correspondence. ECF No. 44.

         Defendant has opposed the Motion to Reopen, moving instead to enforce the settlement agreement. ECF No. 41. Defendant states that "[a]fter several hours of negotiation [at the October 7. 2016 settlement conference], the Parties reached an agreed upon settlement. Prior to concluding the settlement conference, the Parties memorialized the material terms of the settlement." Id. at 2. Defendant attaches the "material term sheet, " which includes twelve numbered, handwritten contractual provisions, and bears the signature of both parties.'[3] ECF No. 41-1 at 2-5. Defendant further states that the parties took several actions in furtherance of formalizing the settlement, including making arrangements for Defendant to send the settlement check to Plaintiffs counsel. See ECF No. 41 at 2. Because the Court finds that the parties reached a complete agreement with readily ascertainable terms, and that Plaintiff has not shown good cause to reopen the case, the Court will enforce the settlement agreement attached at ECF No. 41-1 at 2-5 and deny the motion to reopen.

         II. ANALYSIS

         A. Motion to Reopen and Motion to Enforce Settlement Agreement

         "When parties to litigation pending in district courts enter into agreements to settle their disputes, the courts "have inherent authority, derived from their equity power, to enforce settlement agreements."" Lopez v. XTEL Const. Grp.. LLC, 796 F.Supp.2d 693, 698-99 (D. Md. 2011) (citing Williams v. Prof I Tramp.. Inc.. 388 F.3d 127, 131-32 (4th Cir. 2004)). "If there is a factual dispute over the existence of an agreement, or over the agreement's terms, the district court may not enforce a settlement agreement summarily, ''' Hensley v. Atcon Labs.. Inc., 277 F.3d 535. 541 (4th Cir. 2002) (emphasis in original), but instead must conduct an evidentiary hearing. Williams. 388 F.3d at 132. Before the Court may enforce the agreement, it must determine that "the parties reached a complete agreement" and be able to discern the terms and conditions of that agreement. Lopez. 796 F.Supp.2d at 699 (citing Hensley, 277 F.3d at 540-41) (internal citations omitted). "Notably, the fact that a party may have second thoughts about the results of a valid settlement agreement does not justify setting aside an otherwise valid agreement." Id. (internal citations omitted).

         As a settlement agreement is a contract, the Court applies basic contract principles when considering a motion to enforce a settlement agreement. Bradley v. Am. Household Inc.. 378 F.3d 373. 380 (4th Cir. 2004). Maryland law provides that "[a] contract is formed when an unrevoked offer made by one person is accepted by another." Cty. Comm 'rs for Carroll Cly. v. Forty W. Builders, Inc.. 178 Md.App. 328, 377 (2008). An essential element in the formation of a contract is the "manifestation of agreement or mutual assent by the parties to the terms thereof; in other words, to establish a contract the minds of the parties must be in agreement as to its terms." Id. (citing Safeway Stores, Inc. v. Altman. 296 Md. 486. 489 (1983)). The manifestation of mutual assent requires "(1) intent to be bound, and (2) definiteness of terms." Cochran v. Norkunas. 398 Md. 1. 14 (2007).

         In this case. Plaintiff does not dispute that the settlement agreement exists. In fact, she readily admits that she attended the hearing and signed the settlement claim. ECF No. 36 at 1. Plaintiff also does not dispute the terms of the agreement, which are clearly stated in the unambiguous, albeit informal, agreement attached to the pleadings and signed by both parties. See ECF No. 41-1. The agreement provides that Defendant shall pay $150, 000 to the insured, any additional payees under the insurance policy, and Plaintiffs counsel. Id., at 2. It further states that there will be no admission of liability, the case will be dismissed with prejudice within 10 days after settlement payment is sent to Ms. Dern"s attorney, and that Ms. Dern will agree to release Defendants of all claims under the insurance policy and relating to the fire. Id. Of particular relevance here, the agreement also states that Ms. Dern "will represent that she is satisfied with representation of the counsel that she received in the matter/" Id. at 4. Thus, the terms of the agreement are readily ascertainable and definite. See Lopez v. XTEL Const. Grp, LLC, 796 F.Supp.2d 693, 699 (D. Md. 2011) (granting motion to enforce oral settlement agreement when terms were readily ascertainable). The agreement also bears the signature of both parties, indicating their intent to be bound. See Douglas v. First Sec. Fed. Sav. Bank, Inc., 101 Md.App. 170, 185 (1994) (noting that a party's signature indicates an intent to be bound by an agreement). Having ''second thoughts about the result of a valid settlement agreement does not justify setting aside an otherwise valid agreement." Lopez, 796 F.Supp.2d at 699. For these reasons, the Court finds the parties reached a complete agreement, and that the Plaintiff has not demonstrated good cause to withdraw from the agreement. The Court therefore denies Plaintiffs Motion to Reopen, and grants Defendant's Motion to Enforce the Settlement Agreement.

         B. Motion to Withdraw as Attorney

         Plaintiffs counsel has moved to withdraw as attorney, citing "irreconcilable differences" with the client, arising from the "tone and content of the Dern letter of October 21, 2016." ECF No. 40 at 2. The withdrawal of appearance by an attorney for an individual is governed by Local Rule 101.2(a), which provides:

[A]ppearance of counsel may be withdrawn only with leave of court and if (1) appearance of other counsel has been entered, or (2) withdrawing counsel files a certificate stating (a) the name and last known address of the client, and (b) that a written notice has been mailed to or otherwise served upon the client at least seven (7) days previously advising the client of counsel's proposed withdrawal and notifying the client either to have new ...

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