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Settlement Defense Squashed; Bad Release to Blame

A few weeks ago, the Fourth District Court of Appeal issued an opinion in a new settlement defense case.  Scott Thompson was a passenger in a car that spun out of control; the resulting accident caused the deaths of everyone in the car.  Thompson’s father, as personal representative of his son’s estate, made an offer to GEICO Insurance Company to settle the wrongful death claims.  In response, GEICO sent a letter that conditioned payment of the policy limit on the execution of an overly broad release.

Although the offer was directed only at GEICO’s insureds, GEICO added someone to its release that had not been included in the settlement offer.  It also put unusual hold harmless / indemnification language in the release that had never been bargained for.  The acceptance did not mirror the offer, but GEICO moved to enforce the settlement anyway, claiming that it had complied with all the conditions of the offer.

In Thompson v. Maurice, the Fourth DCA held that no settlement was reached, even though GEICO had complied with the offer’s conditions:

Here, the plaintiff’s settlement offer did not contain any indemnification language. Instead the offer enumerated a closed list of conditions, “complete performance of each of every one” of which would constitute acceptance by GEICO and the defendants. GEICO, however, conditioned its acceptance upon execution of a release that introduced broad indemnification language, thereby injecting a new “essential element of the agreement” into the pre-suit negotiations. Thus, GEICO did not assent to “the same matters contained in the offer.” See Cheverie, 783 So. 2d at 1119.

Although the opinion doesn’t seem to break much new ground, one possibly significant feature is that the court is silent on whether the claimant promptly wrote back to GEICO and specifically objected to the release language.  Although there are opinions from other DCAs which seem to imply that a prompt objection from the plaintiff is necessary, this court doesn’t seem to think it is.  That is definitely a step in the right direction.

#legalinsider #blawg #settlementdefense #GEICO #auto