Thus, as a threshold matter, the trial court must determine whether the settlement is legally valid, i.e. , obtained with informed consent of the individual plaintiffs and without collusion or internal conflicts of interest. Johnson , 203 Ill.2d at 132, 271 Ill.Dec. 258, 784 N.E.2d 812 ; Knisley v. City of Jacksonville , 147 Ill.App. 3d 116, 122, 497 N.E.2d 883, 887–88, 100 Ill.Dec. 705 (1986). In determining whether a settlement agreement is legally valid, the court may consider a number of factors, including the nature of the good-faith proceedings, the manner in which the settling parties obtained approval of the settlement, the terms of the settlement, and whether the settlement was obtained with the informed consent of the individual plaintiffs and without internal conflicts of interest.
( Skinner, 172 Ill. App.3d 790.) An attorney may bind a client to a settlement agreement ( Knisley v. City of Jacksonville (1986), 147 Ill. App.3d 116, 120; Sheffield Poly-Glaz, Inc. v. Humboldt Glass Co. (1976), 42 Ill. App.3d 865, 869), and a settlement agreement based on an oral agreement is enforceable ( Sheffield Poly-Glaz, Inc., 42 Ill. App.3d at 868; Zamouski v. Gerrard (1971), 1 Ill. App.3d 890, 895). An attorney authorized to represent a client in litigation, however, does not necessarily have authority to conclude a settlement. ( Knisley, 147 Ill. App.3d at 120; Danziger v. Pittsfield Shoe Co. (1903), 204 Ill. 145, 149; Jones v. Engel (1953), 349 Ill. App. 423.)
The decision of whether to settle a civil matter is one of the most fundamental and important rights reserved to the client. Knisley v. City of Jacksonville, 147 Ill. App. 3d 116, 120-21 (1986). Viewing Rules 1.2 and 1.4 together, along with other general, well-settled principles of the attorney-client relationship, we conclude that a fee agreement that delegates settlement authority to the attorney, signed at the outset of the representation, is inconsistent with the Rules of Professional Conduct.
A settlement agreement is binding so long as there is clearly an offer to compromise and an acceptance, and there is a meeting of the minds as to the terms of the agreement. (165 Ill. App.3d at 427; Knisley v. City of Jacksonville (1986), 147 Ill. App.3d 116, 119.) Although counsel for a party may bind his client to a settlement agreement (147 Ill. App.3d at 120; Sheffield Poly-Glaz, Inc. v. Humboldt Glass Co. (1976), 42 Ill. App.3d 865, 869), the evidence presented at the hearing indicated that the July 15 letter from attorney Thomas Greenwald to attorney Howard Feldman did not reflect a "meeting of the minds."
It is no answer to say that Ms. Seymour's March 30th email to her lawyers was an "unequivocal rejection" of the allocation provision — a provision she had accepted two weeks earlier through her lawyers. Under basic principles of agency, that approval bound her. Knisley v. City of Jacksonville, 147 Ill.App. 3d 116, 120, 497 N.E.2d 883 (4th Dist. 1986); In re Marriage of Clarke, 194 Ill.App.3d 248, 252, 550 N.E.2d 1220 (1st Dist. 1990) (attorney's statements may bind the client to a settlement agreement even when the client later claims to have misunderstood the terms of the settlement). In addition to coming too late, Ms. Seymour's "rejection" was never communicated to the defendants, and a secret, undisclosed "mental reservation" on the part of one party to a settlement agreement is ineffectual.
The court notes that the Illinois courts follow the same rules when confronted with an unauthorized settlement of a plaintiff's claim. See Knisley v. City of Jacksonville, 147 Ill. App.3d 116, 100 Ill. Dec. 705, 497 N.E.2d 883 (1986), app. denied, 113 Ill.2d 575, 106 Ill.Dec. 47, 505 N.E.2d 353 (1987); Burton by Burton v. Estrada, 149 Ill. App.3d 965, 103 Ill.Dec. 233, 501 N.E.2d 254 (1986), and cases cited therein. Like the present action, the Knisley decision involved a large group of plaintiffs who agreed that no settlement would be entered without the consent of the majority.
The attorney of record is presumed to have authority to settle a case in open court unless rebutted by affirmative evidence showing that authority is lacking. See Brewer v. National R.R. Passenger Corp., 165 Ill.2d 100, 106, 208 Ill.Dec. 670, 649 N.E.2d 1331, 1334 (1995) (citations omitted); In re Marriage of Marr, 264 Ill. App.3d 932, 935, 202 Ill.Dec. 657, 660, 638 N.E.2d 303, 306 (1st Dist. 1990); Knisley v. City of Jacksonville, 147 Ill. App.3d 116, 120, 100 Ill.Dec. 705, 708, 497 N.E.2d 883, 886 (4th Dist. 1986), appeal denied, 113 Ill.2d 575, 106 Ill.Dec. 47, 505 N.E.2d 353 (1987). The law of principal and agent is generally applicable to the relationship between attorney and client.
Other jurisdictions have also determined that an exception to the aggregate settlement rule does not apply to non-class action cases because of the lack of Rule 23 safeguards. See, e.g. , Knisley v. City of Jacksonville , 147 Ill.App.3d 116, 100 Ill.Dec. 705, 497 N.E.2d 883, 887-88 (1986), appeal denied , 113 Ill.2d 575, 106 Ill.Dec. 47, 505 N.E.2d 353 (1987) (noting the distinction for the purposes of the aggregate settlement rule between class action suits and joinder actions because court approval of settlements is required in class actions and not in joinder actions); Tax Auth., Inc. v. Jackson Hewitt, Inc. , 187 N.J. 4, 898 A.2d 512, 514-15, 522 (2006) (determining that the aggregate settlement rule applied to a non-class action lawsuit pursued collectively on behalf of 154 plaintiffs). 2. Rule 8.4(c)
Other jurisdictions have also determined that an exception to the aggregate settlement rule does not apply to non-class action cases because of the lack of Rule 23 safeguards. See, e.g., Knisley v. City of Jacksonville, 497 N.E.2d 883, 887-88 (Ill.App.Ct. 1986), appeal denied, 505 N.E.2d 353 (Ill.App.Ct. 1987) (noting the distinction for the purposes of the aggregate settlement rule between class action suits and joinder actions because court approval of settlements is required in class actions and not in joinder actions); Tax Auth., Inc. v. Jackson Hewitt, Inc., 898 A.2d 512, 514-15, 522 (N.J. 2006) (determining that the aggregate settlement rule applied to a non-class action lawsuit pursued collectively on behalf of 154 plaintiffs). 2. Rule 8.4(c)
More than ten years later, the Appellate Court of Illinois reached a similar result. In Knisley v. City of Jacksonville,147 Ill.App.3d 116, 100 Ill.Dec. 705, 497 N.E.2d 883 (1986), appeal denied, 113 Ill.2d 575, 106 Ill.Dec. 47,505 N.E.2d 353 (1987), also decided under DR 5-106, the court invalidated a settlement agreement that had been approved by a majority of the plaintiffs. There, the sixty-one plaintiffs sought to enjoin the City of Jacksonville from issuing certain building permits.