Vandiver v. McFarland

346 S.E.2d 854, 179 Ga. App. 411
CourtCourt of Appeals of Georgia
DecidedJune 19, 1986
Docket72183
StatusPublished
Cited by22 cases

This text of 346 S.E.2d 854 (Vandiver v. McFarland) is published on Counsel Stack Legal Research, covering Court of Appeals of Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Vandiver v. McFarland, 346 S.E.2d 854, 179 Ga. App. 411 (Ga. Ct. App. 1986).

Opinions

Birdsong, Presiding Judge.

The defendant McFarland in this personal injury case filed a “Motion to Enforce Settlement Agreement and for Order of Judgment Thereon.” Plaintiffs’ attorneys filed a cross-motion in support of McFarland’s motion, with affidavits averring that a binding settlement agreement was entered into. Plaintiffs hired a new attorney. The trial court granted McFarland’s motion. On appeal, the plaintiffs contend the trial court erred in denying their objections and motions to strike the attorneys’ affidavits for insufficiency, and erred in enforcing the settlement.

The plaintiffs’ erstwhile attorney, Brown, swears by affidavit that he entered into the agreement with McFarland’s attorney, and that he had “express authorization from the plaintiff, Alan Dean Vandiver,” to settle as he did. Brown’s partner, D’Orazio, swore by affidavit that “[o]ur firm had and I exercised express authority ... to enter into the settlement agreement.”

In response, Alan Vandiver asserts by affidavit that he discussed a settlement but he did not authorize his attorneys to settle all claims; and that he “never [agreed] to settle [his] claim,” and informed his attorneys he would not settle, on the terms proposed. Elaine Vandiver averred she had no knowledge of the purported settlement, was not asked for and gave no consent and did not authorize the attorneys to settle her claims.

The attorney fee agreement provided: “[N]o settlement. . . may be made without the consent of the undersigned [plaintiffs].” (Emphasis supplied.)

The trial court found “that a [definite and certain] verbal settlement agreement was reached between counsel for the defendant and the [plaintiff’s attorneys]”; and further “that the [attorneys] had apparent authority by law to enter on behalf of the plaintiffs such settlement agreement. ...” Held:

[412]*412The Supreme Court held in Brumbelow v. Northern Propane Gas Co., 251 Ga. 674-675 (308 SE2d 544): “Under Georgia law an attorney of record has apparent authority to enter into an agreement on behalf of his client and the agreement is enforceable against the client by other settling parties. [Cits.] This authority is determined by the contract between the attorney and the client and by instructions given the attorney by the client, and in the absence of express restrictions the authority may be considered plenary by the court and opposing parties. [Cits.] The authority may be considered plenary unless it is limited by the client and that limitation is communicated to opposing parties. [Cits.] Therefore, from the perspective of the opposing party, in the absence of knowledge of express restrictions on an attorney’s authority, the opposing party may deal with the attorney as if with the client, and the client will be bound by the acts of his attorney within the scope of his apparent authority. . . .”

Accordingly, we must hold the trial court correctly granted judgment enforcing this settlement. Further, since under Brumbelow it is immaterial whether the attorney had authority to settle, any insufficiencies in the affidavits as to authority, are immaterial.

Brumbelow holds an attorney has plenary authority in fact to dispose of his client’s claim or defense without authority. The Supreme Court explains that the client’s remedy for unauthorized settlement is not to forbid such settlement in the first place, but to force the client to sue his own lawyer after the fact, under DR 7-102 (A) (9) of the Rules and Regulations of the State Bar of Georgia: “In his representation of a client, a lawyer shall not . . . institute, cause to be instituted or settle a legal proceeding or claim without obtaining proper authorization from his client.” But it seems to us this State Bar Rule means attorneys have no such apparent authority and have no right to presume others do.

The remedy proposed by the Supreme Court is an empty one: if after much trouble, litigation and expense the client succeeds in convincing a court or jury, over the attorney’s word, that the settlement was unauthorized and that the claim or defense thus disposed of was valuable, what if the attorney cannot pay?

In our experience, attorneys expect that an agreement by counsel to settle depends on the client’s approval, and offers and acceptances are generally made on that basis. By holding otherwise, the Brumbelow rule propagates litigation. It puts the burden on clients to prove that their attorney breached his trust; and not least, it sacrifices the delicate relation of trust between client and lawyer — all merely to give the opponent a bonus in the form of settlement he had no right to expect in the first place.

Considering what is lost here, what is the monumental burden in simply requiring attorneys to obtain special authority before settling [413]*413a case?

The main cases relied upon by Brumbelow for its rule of “apparent authority,” actually involved the special equity of detrimental reliance by the other party. General Communications Svc. v. Ga. Public Svc. Comm., 244 Ga. 855 (262 SE2d 96); Stone Mountain &c. Assn. v. Smith, 170 Ga. 515 (153 SE 209). Other cited authorities were Glazer v. J. C. Bradford & Co., 616 F2d 167, where the party asked his lawyer to settle and placed no limitations on his authority, and Davis v. Davis, 245 Ga. 233 (264 SE2d 177). In Glazer, the federal court also relied upon Davis v. Davis, supra, which relied upon Shepherd v. Carlton’s Nice Cars, 149 Ga. App. 749 (256 SE2d 113). Shepherd based its broad “apparent authority” statement upon Dean v. Jackson, 219 Ga. 552 (134 SE2d 601), which really involved only a stipulation as to the “management and direction of the client’s case” authorized by OCGA § 15-19-5. (See Davis v. First Nat. Bank, 139 Ga. 702, 706, 710 (78 SE 190): The statute concerning attorney’s authority to bind client, OCGA § 15-19-5, historically refers to the “conduct and management of the case” and does not imply authority to dispose of a claim or defense in spite of client’s instructions.) Further, the cases cited for Brumbelow’s holding that the attorney’s authority is plenary unless any restrictions are communicated to the opposing party, involved agreements that had gone to judgment which could be set aside only for fraud of the opponent. Reece v. McCormack, 188 Ga. 665 (4 SE2d 575); Elliott v. Elliott, 184 Ga. 417 (191 SE 465). But see Davis v. First Nat. Bank, supra, pp. 710-711; 7A CJS 214, p. 370; 7 AmJur2d, § 158.

It may be true that an agent can bind his principal if a third party is unaware of limitations on his authority, but only if some fact appears which would justify the third party in assuming the agent had such authority in the first place. See Shivers v. Barton & Ludwig, 164 Ga. App. 490, 491 (296 SE2d 749); Commercial Auto Loan Corp. v. Baker, 73 Ga. App. 534, 535 (37 SE2d 636); 1 EGL 469, 519, Agency, §§ 33, 119 (1977 rev.). The mere act of hiring an attorney does not imply to anyone that the attorney has authority to dispose of his client’s claim or defense. If the public were told that it did and that the attorney they hire can therefore dispose of their claims and defenses at will,

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Vandiver v. McFarland
346 S.E.2d 854 (Court of Appeals of Georgia, 1986)

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Bluebook (online)
346 S.E.2d 854, 179 Ga. App. 411, Counsel Stack Legal Research, https://law.counselstack.com/opinion/vandiver-v-mcfarland-gactapp-1986.