Opinion
C.A. No. 05C-04-087 CLS.
Date Submitted: May 9, 2011.
Date Decided: May 25, 2011.
On Plaintiffs' Motion to Enforce the Settlement Agreement. DENIED.
Amanda L.H. Brinton, Esq., Wilmington, DE. Attorney for Plaintiffs.
Richard D. Abrams, Esq., Wilmington, DE. Attorney for Defendant Progressive Insurance Company.
ORDER
Introduction
Before the Court is Plaintiffs' motion to enforce the settlement agreement. The Court has reviewed the parties' submissions. For the reasons that follow, the motion to enforce the settlement agreement is DENIED.
Facts
This case arises out of an automobile accident that occurred on May 10, 2002. Shonda Johnson and her insurance carrier, State Farm Mutual Automobile Insurance Company ("Plaintiffs"), filed this subrogation action on April 8, 2005, against David Dellorse and James Michael Rooney ("Defendant Rooney") seeking recovery of insurance benefits paid to or on behalf of Plaintiff Johnson as well as her deductible.On November 1, 2005, Plaintiffs added Angela F. Dellorse and Progressive Insurance Company ("Progressive") as Defendants. Plaintiffs allege Progressive was the liability carrier for the vehicle owned by David and Angela Dellorse. Progressive alleges the policy was cancelled for non-payment, or alternatively, Angela Dellorse was an excluded driver.
On August 27, 2008, default judgments were entered against Angela Dellorse and James Michael Rooney for failing to appear in the action. The judgment was in the amount of $222,986.67.
Progressive filed a motion for summary judgment that was scheduled to be heard on July 13, 2009. The motion was vacated in favor of settlement negotiations. Progressive's Adjuster, Colleen Rosati, stated in an email to counsel for Progressive that she was attempting to resolve the matter and had "again" advised Plaintiff's counsel that settlement required the release of all parties, including the defaulted Defendants. Plaintiffs contend the settlement was only for the two remaining Defendants, Progressive and Mr. Dellorse, even though her emails to counsel for Progressive indicate the release was for three of the Defendants. Defendant Rooney was excluded.
Defendant Progressive Ins. Co.'s Response to Plaintiff's Motion to Enforce Settlement Ex. A.
Progressive contends the requirement that all Defendants be released as part of the settlement was made clear from the beginning. Progressive eventually offered Plaintiffs the policy's limit of $25,000. Plaintiffs refused to release all Defendants unless Progressive paid $50,000. Progressive declined to pay that amount.
Progressive and its counsel continued to prepare for trial. Plaintiffs did not notify the Court or counsel for Progressive of the alleged settlement. A settlement check was never requested.
On September 30, 2009, Progressive's counsel filed three motions in limine. On October 1, 2009, counsel for Plaintiffs emailed counsel for Progressive asking if the settlement negotiations that have been occurring are no longer viable. The email did not allege a settlement had already been reached.
On October 23, 2009, counsel for Plaintiffs admitted she did not have written documentation of the alleged settlement. She later testified she did not have documentation about the settlement negotiations or the alleged settlement. Despite having no written documentation to support her allegation, counsel for Plaintiffs filed this motion to enforce the settlement agreement.
Discussion
There is no settlement agreement to enforce because a contract was never formed. The formation of a contract "requires a bargain in which there is manifestation of mutual assent to the exchange and consideration." Delaware follows the mirror image rule, requiring the acceptance to be identical to the offer. To be enforceable, all the material terms must be included in the contract. When the material terms are left open or uncertain, then an offer and acceptance did not occur. A contract cannot be formed unless there has been a valid acceptance.
Montgomery v. Achenbach, 2007 WL 1784080, at *2 (Del. Super. Ct.).
Ramone v. Lang, 2006 WL 905347, *10 (Del. Ch.) ( citing Wood v. State, 815 A.2d 350 (Del. 2003) (TABLE)).
Id. ( citing Friel v. Jones, 206 A.2d 232, 233-34 (Del. Ch. 1964), aff'd, 212 A.2d 609 (Del. 1965); PAMI-LEMB I Inc. v. EMB-NHC, L.L.C., 857 A.2d 998, 1015 (Del. Ch. 2004)).
Id. (citations omitted).
Id. at *11 ( citing Leeds v. First Allied Connecticut Corp., 521 A.2d 1095, 1101 (Del. Ch. 1986).
See Id.
There was no contract in this case because there was no acceptance to the offer or counteroffer. Acceptance did not occur because the parties did not agree on the number of Defendants to be released by the agreement, a material term to the contract. The parties agree that Progressive offered $25,000 and the release of the Defendants. The Defendants contend the offer was for the release of all four of the Defendants, including the defaulted Defendants. Plaintiffs contend the offer was for the release of two or three of the four Defendants. Plaintiffs' purported acceptance was actually a counteroffer to release two or three of the Defendants. Defendants rejected the counteroffer when it refused to settle for less than the release of all Defendants. Since Delaware requires the acceptance to be identical to the offer there was no acceptance to either Plaintiffs' offer to release two or three of the Defendants or the Defendants' counteroffer to release all four Defendants. A contract cannot be formed without an acceptance to the offer so there is nothing for the Court to enforce.
Conclusion
Based on the forgoing, Plaintiff's Motion to Enforce the Settlement Agreement is DENIED.
IT IS SO ORDERED.