"A motion to enforce a settlement agreement is essentially the same as a motion to enforce a contract." Allstate Fin. Corp. v. Util. Trailer of Ill., Inc., 936 F. Supp. 525, 528 (N.D. Ill. 1996); see Hyde Park Union Church v. Curry, 942 F. Supp. 360, 363 (N.D. Ill. 1996) (stating that a contract analysis must occur to determine whether a contract to settle was formed); Schaap v. Executive Indus., Inc., 760 F. Supp. 725, 726 (N.D. Ill. 1991) (stating that a court must find the traditional elements of a contract before it will enforce a settlement agreement). Because a settlement agreement is a contract, state contract law governs its construction and enforcement.
"A motion to enforce a settlement agreement is essentially the same as a motion to enforce a contract." Allstate Fin. Corp. v. Util. Trailer of Ill., Inc., 936 F. Supp. 525, 528 (N.D. Ill. 1996); see Hyde Park Union Church v. Curry, 942 F. Supp. 360, 363 (N.D. Ill. 1996) (contract analysis must be applied in order to determine whether the parties formed a contract to settle); Schaap v. Executive Indus., Inc., 760 F. Supp. 725, 726 (N.D. Ill. 1991) (traditional contract elements must be found before the court will enforce a settlement agreement). Because a settlement agreement is a contract, enforceability of a settlement agreement is governed by local contract law.
Put differently, `intent' in contract law is objective rather than subjective. . . ."). See also Allstate Fin. Corp. v. Utility Trailer of Illinois, Inc., 936 F. Supp. 525, 528 (N.D. Ill. 1996) (stating that a motion to enforce a settlement agreement is essentially the same as a motion to enforce a contract and ordinary contract construction rules apply); Hyde Park Union Church v. Curry, 942 F. Supp. 360, 363 (N.D. Ill. 1996) (stating that a contract analysis must occur to determine whether a contract to settle was formed); Schapp v. Executive Indus., Inc., 760 F. Supp. 725, 726 (N.D. Ill. 1991) (stating that the traditional elements of a contract must be present before a court will enforce a settlement agreement). The parties correctly agree that Illinois law applies to this dispute.
This is the standard practice. See, e.g., Kapco Mfg. Co. v. C O Enterprises, Inc., 886 F.2d 1485, 1489 (7th Cir. 1989) (per curiam); Red Ball Interior Demolition Corp. v. Palmadessa, 173 F.3d 481, 482 (2d Cir. 1999); Futernick v. Sumpter Township, 78 F.3d 1051, 1054 n. 3 (6th Cir. 1996); Murchison v. Grand Cypress Hotel Corp., 13 F.3d 1483, 1485 (11th Cir. 1994); Kelly v. Greer, 334 F.2d 434, 436 (3d Cir. 1964); Xorbox v. Naturita Supply Co., 101 N.M. 337, 681 P.2d 1114, 1115 (N.M. 1984); Hyde Park Union Church v. Curry, 942 F.Supp. 360, 361 (N.D.Ill. 1996). It should be followed in all cases. But there is no use crying over spilled milk. No point would be served by remanding the case for an evidentiary hearing at which the magistrate judge would testify to his recollection of the November 23 conference and the other participants would testify to their recollections.
The party seeking to enforce the settlement agreement has the burden of establishing the existence of an enforceable settlement agreement. Hyde Park Union Church v. Curry, 942 F.Supp. 360, 363-64 (N.D. Ill. 1996).
In general, a party moving to enforce an alleged settlement agreement bears the burden of establishing that the essential elements to a valid settlement agreement exist. Hyde Park Union Church v. Curry, 942 F. Supp. 360, 363-64 (N.D. Ill. 1996). "A settlement agreement is merely a contract between the parties to the litigation, wherein generally the defendants promise some partial remedy in exchange for the plaintiff's promise to dismiss the case and release the defendants from any future liability for their conduct that formed the basis of the dispute." Carr v. Runyan, 89 F.3d 327, 331 (7th Cir. 1996).
In order to enforce an oral settlement agreement, three elements must be shown: (1) an offer was made by one party, (2) accepted by the other, and (3) consideration was exchanged. Centurylink v. BBC Elec. Servs., Inc., 2013 WL 5461097, * 1 (N.D. Ind. Sept. 26, 2013); Hyde Park Union Church v. Curry, 942 F. Supp. 360, 363 (N.D. Ill. 1996). The parties must knowingly and voluntarily enter into the agreement either personally or by providing their attorneys with authority to settle.
In order to enforce an oral settlement agreement, three elements must be shown: (1) an offer was made by one party, (2) accepted by the other, and (3) consideration was exchanged. Centurylink v. BBC Elec. Servs, Inc., 2013 WL 5461097, * 1 (N.D. Ind. Sept. 26, 2013); Hyde Park Union Church v. Curry, 942 F. Supp. 360, 363 (N.D. Ill. 1996). The parties must knowingly and voluntarily enter into the agreement either personally or by providing their attorneys with authority to settle. Hartman v. Hook-Superx Inc., 42 F.Supp.2d 854, 855 (S.D. Ind. 1999).
As the parties seeking to enforce the Term Sheet, Defendants have the burden of establishing an offer, acceptance, and mutual assent to all of its material terms. See Kemp v. Bridgestone/Firestone, Inc., 625 N.E.2d 905, 909 (Ill. App. Ct. 1993) (citing Commonwealth Edison Co. v. Indus. Comm'n, 521 N.E.2d 159, 161 (Ill. App. Ct. 1988)); see also Cent. States, Se. & Sw. Areas Pension Fund v. Stewart, 2015 WL 7568390, at *3 (N.D. Ill. Nov. 25, 2015); Hyde Park Union Church v. Curry, 942 F. Supp. 360, 363-64 (N.D. Ill. 1996). However, because Plaintiff contends that the parties' signatures were conditions precedent to the enforcement of the Term Sheet, Plaintiff bears the burden of proving the parties intended this condition at the time of the contract.
It is clear under the circumstances that Plaintiff merely had a change of heart, which is not a reason not to enforce a valid settlement agreement. See Hyde Park Union Church v. Curry, 942 F. Supp. 360, 363 (N.D. Ill. 1996) ("[D]efeated expectations do not entitle a party to repudiate promises made to opposing parties or the court."); Glass, 788 F.2d at 454 ("A party to a settlement cannot avoid the agreement merely because he subsequently believes the settlement insufficient . . ."); In re Marriage of Maher, 420 N.E. 2d 1144, 1147 (Ill. App. Ct. 1981) ("[S]ettlements which have been assented to by the parties may not be cancelled solely upon the withdrawal of one party's assent prior to entry of the judgment.").