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Harrison v. Dixon

Court of Chancery of Delaware, New Castle

September 5, 2013

Harrison
v.
Dixon, et al.

Submitted: July 5, 2013

David J. Ferry, Jr., Esquire Ferry Joseph & Pearce,

Whitney W. Deeney, Esquire Saul Ewing LLP

Seth L. Thompson, Esquire Roseann Dixon (FSE & U.S. Mail) Shirley Harrison (U.S. Mail Only)

Dear Counsel:

The plaintiff and two of the defendants in this action engaged in settlement negotiations with the goal of resolving the plaintiff's claim against those two defendants. After the parties agreed to the amount of monetary consideration to be paid toward settlement, one of the defendants stated that it no longer was willing to settle due to complications and uncertainties regarding other terms of the settlement. The plaintiff then sought to enforce what he contends was the parties' settlement agreement. For the reasons that follow, I find that the settlement is not enforceable because the parties did not reach an agreement on all of the essential terms to the settlement. I therefore recommend that the Court enter an order denying the motion to enforce the settlement agreement.

FACTUAL BACKGROUND

The plaintiff, Jacob Harrison ("Jacob"), [1] filed this action against his sister, Roseann Dixon, for her conduct as administrator of the estates of Remell Harrison ("Remell") and Clarence Harrison ("Clarence"), who were Jacob and Ms. Dixon's parents. In addition to his claims against Ms. Dixon, Jacob also named Delaware Investment Services, Inc. ("DIS") and Nieaishia N. Dollard as defendants, [2] because – according to Jacob – property that DIS purchased from Ms. Dixon actually was owned by all of Clarence's heirs, because Clarence owned the property and, upon his death, it passed by operation of law to Jacob, Ms. Dixon, and their siblings. Jacob contends that, because Ms. Dixon did not have sole title to the property, she could not legally convey the property to DIS, and he therefore seeks a court order declaring that the conveyance of the property from Ms. Dixon to DIS, and DIS's later conveyance of the property to Ms. Dollard, were fraudulent and invalid transfers.

Counsel to Jacob, DIS, and Ms. Dollard entered into settlement discussions in an effort to resolve Jacob's claim regarding the property. According to the record, which consists primarily of e-mails between counsel, it appears that in late March 2013, DIS's counsel, Whitney Deeney, Esquire, conveyed a $15, 000 settlement offer to Jacob's counsel, David Ferry, Esquire.[3] During an April 15, 2013 teleconference between Ms. Deeney, Mr. Ferry, and Seth Thompson, Esquire, counsel to Ms. Dollard, Mr. Ferry made a counteroffer to settle Jacob's claim against DIS and Ms. Dollard for $18, 000.[4] Ms. Deeney rejected that offer on behalf of both defendants on April 18, 2013, and inquired whether Jacob would be "amenable to settlement at [$15, 000]."[5] On April 23, 2013, Mr. Ferry responded that defendants' counsel should "send [him] the papers [they] want[ed] signed for the $15, 000 settlement amount with [Mr. Harrison] so [he could] go through them with [Mr. Harrison] to get them signed."[6] In response, Ms. Deeney indicated that her client no longer was willing to settle for that amount, "given that [the settlement] will not resolve all potential claims."[7] Ms. Dollard, on the other hand, remains willing to proceed with settlement at $15, 000.[8] When the parties were unable to resolve between themselves whether an enforceable settlement had been reached, Plaintiff filed his motion to enforce the settlement agreement.

Jacob contends that Mr. Ferry's e-mail asking defendants' counsel to forward the draft settlement papers they wanted signed at $15, 000 constituted an acceptance of the defendants' offer to settle at that amount, and that the parties therefore have an enforceable contract. In response, DIS argues that, at most, all the parties agreed to was one term of the settlement – the monetary consideration – and they had not agreed upon what DIS contends were other essential terms for settlement, including how the cross-claims between DIS, Ms. Dollard, and Dixon would be resolved, how title to the property would be quieted in light of potential claims from Clarence's other heirs, whether the plaintiff would indemnify DIS against potential claims, whether Jacob would agree to a confidentiality agreement, and whether the plaintiff would continue to pursue his other claims against Ms. Dixon. DIS also appears to contend that Jacob's "acceptance" of the $15, 000 was not an acceptance sufficient to form a contract because no offer was pending at the time. Jacob responds that DIS's position is revisionist history, and that, whatever its internal reservations about the effectiveness of the settlement, DIS never voiced those concerns during the parties' discussions and overtly manifested its assent to settle for $15, 000.

ANALYSIS

Delaware courts encourage negotiated resolutions to contested cases, and for that reason, among many others, settlement agreements are enforceable as a contract.[9] As the person seeking to enforce the parties' alleged agreement, Jacob bears the burden of proving the existence of a contract by a preponderance of the evidence.[10] In determining whether the plaintiff has met his burden, I must inquire:

whether a reasonable negotiator in the position of one asserting the existence of a contract would have concluded, in that setting, that the agreement reached constituted agreement on all of the terms that the parties themselves regarded as essential and thus that that agreement concluded the negotiations … .[11]

DIS appears to advance two alternate bases to defeat the motion: (1) that no contract was formed because there was no outstanding offer to settle at $15, 000, and (2) that the parties did not agree to all essential terms. Although the first argument lacks support, Jacob has not shown that the parties agreed to all of the essential terms for settlement, and I therefore cannot conclude that a contract was formed when ...


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