Alline M. Pond v. Kathleen M. Picard (2010)

MEMORANDUM OF DECISION

The defendant has moved (# 114) for judgment based upon her acceptance of the plaintiff's offer of compromise pursuant to C.G.S. § 52-192a.¹  The parties have submitted written briefs and a written stipulation of facts.   On May 24, 2010 the parties presented evidence and engaged in oral argument.

In this case the plaintiff, Alline M. Pond, alleges that she was injured as a result of defective premises owned and controlled by the defendant, Kathleen M. Picard.   Until recently, the plaintiff was represented by the law firm of Grady & Riley LLP.

During the course of standard discovery, the defendant certified that it had liability insurance coverage with Hartford Insurance Company (“The Hartford”) in the amount of $1,000,000, plus excess coverage of an additional $1,000,000.   Sometime prior to January 4, 2010, the plaintiff met with an attorney at Grady & Riley to discuss making an offer of compromise.   The attorney mistakenly told the plaintiff that the defendant had total insurance coverage $1,000,000.   At that meeting, the plaintiff authorized Grady & Riley to file an offer to compromise in the amount of $500,000.   On January 4, 2010 Grady & Riley filed an offer to compromise in the amount of $500,000.

Soon thereafter, an adjuster for The Hartford spoke by telephone with an attorney at Grady & Riley and made an offer to settle for $250,000.   Grady & Riley conveyed this offer to the plaintiff who rejected it.   Grady & Riley wrote to the adjuster at The Hartford on January 15, 2010 confirming a telephone message he had left on January 8, 2010 rejecting the $250,000 offer and stating, in part, that:  “it is my firm belief that is not accepted within the thirty (30) days provided by the Rules of Practice, this case may well exceed the value of the policy”;  and “no offer of less than $500,000 will be considered by Alline and your right to accept the Offer will expire on February 3, 2010.   I urge you to carefully consider whether or not to consider the Offer.”

Thereafter, Grady & Riley became aware that they had misinformed the plaintiff about the insurance limits.   When the plaintiff learned that the actual total insurance limit was $2,000,000, the plaintiff ordered Grady & Riley to withdraw the offer of compromise.   On January 18, 2010 Grady & Riley filed a withdrawal of the offer of compromise with the court.   On January 19, 2010 Grady & Riley wrote to the adjuster stating:  “Please note, pursuant to the instruction of the Plaintiff, I have withdrawn the Offer of Compromise in the amount of $500,000 dated January 4, 2010.   After discussion with Ms. Pond we believe the offer was premature.”   On February 2, 2010 counsel for the defendant filed with the court an acceptance of the January 4, 2010 offer of compromise.

On February 25, 2010 the firm of Moynahan & Minella LLC. appeared for the plaintiff in place of Grady & Riley.   They filed the current motion to enforce the settlement on March 30, 2010.   The plaintiff's objection was filed on April 19, 2010.

The issue presented to the court is whether the plaintiff had the power to withdraw the offer of compromise before the expiration of 30 days.   The argument made by the defendant in support of her motion to enforce is that the plaintiff had no power to withdraw the offer of compromise.   She argues that she had 30 days to accept the offer of compromise and that she accepted it within the 30-day period.   The plaintiff has two arguments.   First, she argues that she had an unrestricted right to withdraw the offer at any time, for any reason.   Second, she argues that the $250,000 offer made by The Hartford was equivalent to a rejection which terminated the offer.

The plaintiff has provided the court with Superior Court cases in support of her position.   Each case is very fact-specific and will be discussed separately.   The first case is Lutter v. Kay, Superior Court judicial district of Waterbury, Docket No. 000161393 (October 17, 2002, Holzberg, J.) [33 Conn. L. Rptr. 238].   In February of 2002 the plaintiff's counsel, apparently with the authorization of his client, filed an offer of judgment agreeing to stipulate to judgment in the amount of $250,000.   Through an oversight in his office, plaintiff's counsel failed to transmit the offer of judgment to the defendant.   In September of 2002, approximately 7 months after the offer of judgment had been filed with the court, plaintiff's counsel learned for the first time that the defendant had not received notice of the offer of judgment.   Plaintiff's counsel, apparently without discussing it with his client, immediately filed an amended certification with the court stating that the offer of judgment had been faxed to all counsel of record on September 24, and 25, 2002.   On the evening of September 25, 2002 plaintiff's counsel conferred with his client who directed him to attempt to revoke the offer of judgment faxed to other counsel on that day or the previous day.   On September 27, 2002 at 11:20 a.m. plaintiff's counsel filed with the court a withdrawal of the Offer of Judgment dated February 26, 2002.   On the same day, at 4:45 p.m., counsel for the defendant faxed to the clerk's office an acceptance of the offer of judgment dated September 25, 2002.   At 5:36 p.m. on the same day the defendant faxed to plaintiff's counsel the acceptance of offer of judgment previously faxed to the clerk's office.   Based upon these facts, the court made four conclusions:  1) the offer of judgment dated in February 2002 was ineffective because of the failure to serve the plaintiff;  2) the offer of judgment became effective and valid on September 24 and 25, 2002 when it was faxed to defendant's counsel;  3) plaintiff's withdrawal of the offer of judgment at 11:20 a.m. on September 17, 2002 preceded the defendant's acceptance of the offer at 4:45 p.m.;   and therefore, 4) the withdrawal of the offer of judgment was “valid, binding and effective prior to the defendant's acceptance of it.”   The court assumed, without analysis, that an offer of judgment could be withdrawn for any reason prior to the expiration of the 30-day period.   It is unclear whether this issue was even raised by the defendant.

The second case cited by the plaintiff is actually a subsequent decision in the Lutter v. Kay case following a jury verdict for the plaintiff in the amount of $1,325,000.   Lutter v. Kay, Superior Court judicial district of Waterbury, Docket No. 000161393 (February 18, 2004, Gallagher, J.) [36 Conn. L. Rptr. 517].   An additional fact is that on September 27, 2002 the plaintiff, after he had filed the withdrawal of the February offer of judgment, filed a new offer of judgment for $1,000,000.   Following the jury verdict, the plaintiff sought interest and attorneys fees pursuant to Practice Book § 17-18 and C.G.S. § 52-192a.   Because a plaintiff is only permitted to file one offer of judgment against the same defendant, the issue before Judge Gallagher was whether the offer of judgment filed on September 27, 2002 was first offer of judgment in the case despite the February 2002 offer of judgment.   Judge Gallagher went back to look at the facts which led to the revival of February offer of judgment on September 24 and 25, 2002 and its withdrawal on September 27, 2002.   Judge Gallagher determined that the plaintiff had not given her attorney authority to revive the offer of judgment by belatedly sending copies to the defendant's counsel and amending the certification of service.   Judge Gallagher relied on two other Superior Court cases (to be discussed below) for the proposition that a party is not bound by the terms of an offer of judgment made by her attorney without her authority.   Because, the plaintiff in Lutter v. Kay did not give her authority to revive the offer of judgment in September of 2002, the offer was, therefore, not valid.   Thus, the offer of judgment made on September 27, 2002 was the first offer of judgment in the file and the plaintiff was entitled to interest.

The two cases cited by Judge Gallagher in Lutter v. Kay are Porcu v. Moore, Superior Court, judicial district of Ansonia-Milford at Milford, Docket No. 95-00521368 (June 27, 1997, Flynn, J.) [19 Conn. L. Rptr. 666], and Porrini v. Bissionnette, Superior Court, judicial district of New Britain, Docket No. 00-499365 (June 28, 2001, Graham, J.).   In both cases, the attorneys for the plaintiffs filed offers of judgment without the knowledge or consent of their clients.   In Porcu, Judge Flynn found that the attorney who filed the offer of judgment went beyond his authority to the plaintiff who he was defending on a counterclaim.   Further, because there had been another offer of judgment filed by the attorney who represented the plaintiff on the complaint, the inconsistent filings would prejudice the plaintiff's original claim.   In light of these facts, the court granted the plaintiff's motion to withdraw the offer of judgment filed without authority.

In Porrini, the attorney representing the plaintiff mistakenly filed an offer of judgment in the wrong file;  he intended to file it in case of another client with a similar last name.   The attorney realized the error in time to withdraw the mistakenly-filed offer of judgment before the defendant accepted it within 30 days.   In his decision, Judge Graham mentioned that the parties briefed the issue of whether there is a general right to withdraw an offer of judgment before acceptance.   The parties cited cases from other jurisdictions which Judge Graham says are “generally split on the issue.”   However, Judge Graham concluded that:  “The court does not, and need not, reach the issue of whether a general right exists to plaintiffs to withdraw offers of judgment prior to their acceptance.   While the statute is silent as to that issue, it is not dispositive here.   Absent his client's consent, Moore [plaintiff's counsel] had no authority to file the offer.  Section 52-192a, when properly utilized results in a ‘stipulation for judgment’ of the case.   The plaintiff should be no more bound by an unauthorized offer to stipulate to judgment via an offer of judgment than by an unauthorized motion for stipulated judgment filed without a party's consent.”  (Citations omitted.)  Id.

Here, the facts do not permit the court to find that the offer of judgment filed by Grady & Riley on January 4, 2010 was unauthorized or filed by mistake.   Although the plaintiff had been misinformed about the limits of the insurance available, her attorneys knew the correct limits and had not been misled in any way by the defendant.   The plaintiff gave her consent to file an offer of compromise for $500,000 when she thought that the liability limit was $1,000,000.   The plaintiff did not explain to the court why her decision would have been any different if she had known that the limit was $2,000,000.   It is hard to believe that knowledge of the additional insurance coverage would have made a difference when she was willing to settle for only one-half of what she believed was the coverage.   In any event, the offer of compromise for $500,000 cannot be viewed as unauthorized or a mistake.

Nor, can the court avoid the main issue by finding that the defendant rejected the offer of judgment by calling the plaintiff's attorney and offering $250,000 after receipt of the plaintiff's offer to compromise for $500,000.   Subsequent to this conversation, plaintiff's attorney wrote to The Hartford confirming rejection of the $250,000 offer and reminding The Hartford that “no offer of less than $500,000 will be considered by Alline and your right to accept the Offer will expire on February 3, 2010.”   If the plaintiff had considered the $250,000 counter-offer a rejection of the offer to compromise for $500,000 the plaintiff should have made that clear at that time instead of affirming to The Hartford that the offer to settle for $500,000 remained open until February 3, 2010 when the 30-day statutory period expired.

There being no other ground to decide this motion, the court must determine whether, absent lack of authority to make the offer of compromise, the plaintiff has a general right to withdraw an offer to compromise prior to its acceptance by the defendant.   The plaintiff argues that because C.G.S. § 52-192a and Practice Book §§ 17-4 through 17-17 are silent as to whether an offer of compromise is freely revokable, the issue must be analyzed in accordance with the principles of general contract law which generally permits offers to be revoked before acceptance.   In opposition to the plaintiff's position, the defendant argues that, because the statute and Practice Book sections are silent about the right to revoke, it does not exist.

I agree with the plaintiff that general contract law applies to this situation.   The plaintiff effectively revoked her offer to compromise before it was accepted by the defendant.   Of assistance to the court is the case of Sobelman v. Mark, Superior Court judicial district of Hartford-New Britain, at New Britain, Docket No. 92-0519488 (May 17, 1993, Aronson, J.) [9 Conn. L. Rptr. 127], which confirms that it is appropriate to look to the law of contracts for resolution of issues involving C.G.S. § 52-192a.   In that case the issue was whether an amended offer of judgment, filed within the 30-day period after filing of the original offer of judgment, revoked the original offer.   Judge Aronson, finding no answer in the statute, turned to the law of contracts.   The decision provides:  “It is a ‘basic principle of contract law that an offeror is the master of his offer, and therefore, is not obligated to make an offer on any terms except his own.   It is also a basic proposition in contract law that an offer may be revoked at any time prior to acceptance ․ Even though the offeror specifies in his offer a definite time within which acceptance may be made, the offeror may, nevertheless, revoke his offer within that time period.   This is true even if the offer expressly states that it shall not be withdrawn;  revokation is still possible, since the promise not to withdraw the offer is not itself enforceable.”  (Internal citations and quotation marks omitted.)  Id.

For the reasons given, the court rejects the defendant's argument that withdrawal of an offer of compromise is not possible simply because it is not mentioned in § 52-192a.   The defendant is not prejudiced by this interpretation of the statute.   If the plaintiff chooses to withdraw an offer to compromise before the expiration of 30 days, she will not gain the benefits of the statute in the event of a verdict in excess of the amount of the offer.

The defendant's motion to enforce the settlement is denied.

BY THE COURT,

John W. Pickard

FOOTNOTES

FN1. C.G.S. Sec. 52-192a, and its equivalent Practice Book Sections, 17-14 through 17-18, have been amended frequently since its creation in 1976.   Prior to an amendment in 2005, it permitted the plaintiff to file an offer of judgment for a specific sum of money which, if accepted, would result in a judgment against the defendant for that sum.   The 2005 amendment changed the procedure so that the plaintiff may file an offer of compromise for a specific sum of money which, if accepted by the defendant with 30 days after being notified of the filing, results in a settlement for that sum.   The cases discussed in this opinion were all decided prior to the 2005 amendment and refer to an offer of judgment rather than an offer of compromise..  FN1. C.G.S. Sec. 52-192a, and its equivalent Practice Book Sections, 17-14 through 17-18, have been amended frequently since its creation in 1976.   Prior to an amendment in 2005, it permitted the plaintiff to file an offer of judgment for a specific sum of money which, if accepted, would result in a judgment against the defendant for that sum.   The 2005 amendment changed the procedure so that the plaintiff may file an offer of compromise for a specific sum of money which, if accepted by the defendant with 30 days after being notified of the filing, results in a settlement for that sum.   The cases discussed in this opinion were all decided prior to the 2005 amendment and refer to an offer of judgment rather than an offer of compromise.

Pickard, John W., J.