{ "id": 9498023, "name": "MALLIE HARRIS, Plaintiff v. RAY JOHNSON CONSTRUCTION CO., INC., and MARSHALL AVON McNEILL, Defendants", "name_abbreviation": "Harris v. Ray Johnson Construction Co.", "decision_date": "2000-08-29", "docket_number": "No. COA99-1049", "first_page": "827", "last_page": "831", "citations": [ { "type": "official", "cite": "139 N.C. App. 827" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "464 S.E.2d 711", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1995, "pin_cites": [ { "page": "714" } ], "opinion_index": 0 }, { "cite": "121 N.C. App. 180", "category": "reporters:state", "reporter": "N.C. 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RAY JOHNSON CONSTRUCTION CO., INC., and MARSHALL AVON McNEILL, Defendants" ], "opinions": [ { "text": "LEWIS, Judge.\nOn 2 March 1998, plaintiff filed a lawsuit seeking to hold defendants jointly and severally liable for injuries arising out of an automobile accident in which defendant Marshall Avon McNeill was the named negligent driver. Defendant McNeill was an employee of defendant Ray Johnson Construction Co. Inc. (\u201cConstruction Company\u201d).\nOn 6 November 1998, Brenton Adams, plaintiff\u2019s counsel, and defendant Construction Company\u2019s insurance carrier entered into negotiations regarding a settlement of plaintiff\u2019s claim. The insurance carrier offered to settle plaintiff\u2019s claim for $2000, which Mr. Adams accepted on behalf of his client. Defendants believed this transaction created an oral agreement to settle plaintiff\u2019s claim. However, in a letter, to the insurance carrier dated 2 December 1998, Mr. Adams attempted to repudiate the purported settlement agreement. The insurance carrier received the letter on 28 December 1998. At this time, counsel for defendant Construction Company and its insurance carrier responded to Mr. Adams, asserting that a binding oral agreement had been reached on 16 November 1998. Having received no response from Mr. Adams, on 15 March 1999 defendants filed a Motion to Enforce Settlement in superior court. On 14 May 1999, after reviewing the evidence submitted by both parties, the judge entered an order enforcing the 16 November 1998 oral settlement agreement between plaintiff and defendants. Plaintiff appeals from this order.\nPlaintiffs arguments on appeal question the validity of the purported agreement. A compromise and settlement agreement terminating or purporting to terminate a controversy is a contract, to be interpreted and tested by established rules relating to contracts. Casualty Co. v. Teer Co., 250 N.C. 547, 550, 109 S.E.2d 171, 173 (1959). Here, the issue is a matter of contract interpretation, and hence, a question of law. Davison v. Duke University, 282 N.C. 676, 712, 194 S.E.2d 761, 783 (1973). Our standard of review here is de novo. Staton v. Brame, 136 N.C. App. 170, 174, 523 S.E.2d 424, 427 (1999).\nPlaintiff first contends her attorney, Mr. Adams, had no actual authority to enter into this settlement agreement on her behalf so that she was not bound by the agreement entered on 16 November 1998. Although plaintiff concedes she expressly authorized Mr. Adams to negotiate a settlement on her behalf, she contends there was a misunderstanding as to the amount of that settlement. Specifically, plaintiff claims she intended to net $2000 from the settlement, while her attorney settled for a gross amount of $2000, contemplating that medical bills and attorney\u2019s fees would be deducted from that amount, resulting in a net settlement amount less than $2000 for his client.\nWe recognize that there is a presumption in North Carolina in favor of an attorney\u2019s authority to act for the client he professes to represent. Gillikin v. Pearce, 98 N.C. App. 484, 488, 391 S.E.2d 198, 200, disc. review denied, 327 N.C. 427, 395 S.E.2d 677 (1990). This presumption applies to both procedural and substantive aspects of a case. Greenhill v. Crabtree, 45 N.C. App. 49, 51, 262 S.E.2d 315, 317, aff\u2019d per curiam, 301 N.C. 520, 271 S.E.2d 908 (1980). Special authorization from the client is required before an attorney may enter into an agreement discharging or terminating a cause of action on the client\u2019s behalf. Greenhill, 45 N.C. App. at 52, 262 S.E.2d at 317. \u201cWhere special authorization is necessary in order to make a dismissal or other termination of an action by an attorney binding on the client... it [is also] presumed . . . that the attorney acted under and pursuant to such authorization.\u201d Id. One who challenges the actions of an attorney as being unauthorized has the burden of rebutting this presumption and proving lack of authority to the satisfaction of the court. Chemical Co. v. Bass, 175 N.C. 453, 456, 95 S.E. 766, 767-78 (1918).\nThe attorney-client relationship is based upon principles of agency. Dunkley v. Shoemate, 350 N.C. 573, 577, 515 S.E.2d 442, 444 (1999). A principal is liable on a contract duly made when the agent acts within the scope of his actual authority. Foote & Davies, Inc. v. Arnold, Craven, Inc., 72 N.C. App. 591, 595, 324 S.E.2d 889, 892 (1985). Actual authority is that authority which the agent reasonably thinks he possesses, conferred either intentionally or by want of ordinary care by the principal. Heath v. Craighill, Rendleman, Ingle & Blythe, 97 N.C. App. 236, 241, 388 S.E.2d 178, 181 (1990); 3 Am Jur. 2d Agency \u00a7 73 (1976). Actual authority may be implied from the words and conduct of the parties and the facts and circumstances attending the transaction in question. 3 Am Jur. 2d Agency \u00a7 75 (1976).\nPlaintiffs evidence here establishes Mr. Adams had actual authority to settle her claim for an amount of $2000. Plaintiff retained Mr. Adams as her counsel in this matter and expressly authorized him to settle the claim for an amount in which plaintiff and her counsel thought they had agreed on at the time. According to plaintiffs evidence, plaintiff and her attorney had previously discussed the difference between the net and gross amount, and at the time of the 16 November 1998 negotiation, Mr. Adams \u201cunderstood\u201d that he was to settle the claim for $2000. Only in hindsight did it become clear that Mr. Adams and his client had not reached a clear agreement as to the proper amount. From this evidence we conclude that Mr. Adams reasonably believed at the time of negotiation that he could settle the case for $2000. Thus, he possessed actual authority to settle in that amount, though it was unfortunately conferred by want of ordinary care. Plaintiff has failed to meet her burden of proving Mr. Adams lacked authority and she is bound by his acceptance of defendant\u2019s settlement offer on 16 November 1998.\nPlaintiff next contends even if plaintiff was bound by Mr. Adams\u2019 acceptance of the settlement agreement, all essential terms were not established before plaintiff\u2019s initial acceptance and thus, no binding agreement was reached upon Mr. Adams\u2019 acceptance. Specifically, plaintiff argues that the general release of claims form, releasing \u201call other persons,\u201d was not negotiated as part of the offer of settlement. Plaintiff contends that at best, settlement could have been enforced only with respect to defendant Ray Johnson Construction Co., Inc., and not as to defendant Marshall Avon McNeill. Although we agree that a valid contract exists only where there has been a meeting of the minds as to all essential terms of the agreement, Northington v. Michelotti, 121 N.C. App. 180, 184, 464 S.E.2d 711, 714 (1995), our review indicates the oral agreement made between the parties in this case was not incomplete.\nThe evidence here establishes the 16 November 1998 offer was made to settle plaintiffs entire case. Plaintiffs counsel accepted the offer to settle the entire pending claim on plaintiffs behalf. This acceptance necessarily contained the implied promise to execute some instrument terminating the controversy as to that settling defendant, namely, the stipulation to dismiss the case with prejudice and release of claims form. Because plaintiffs claim was premised on joint and several liability seeking to recover for a single indivisible injury, this implied promise necessarily operated to terminate the controversy as to both defendants. Consequently, after the initial offer and acceptance, there remained nothing to negotiate in terms of the forms necessary to effectuate the settlement.\nAffirmed.\nChief Judge EAGLES and Judge EDMUNDS concur.", "type": "majority", "author": "LEWIS, Judge." } ], "attorneys": [ "Brenton D. Adams for the plaintiff-appellant.", "Cranfill, Sumner & Hartzog, L.L.P., by H. Lee Evans and F. Marshall Wall, for the defendant-appellee Ray Johnson Construction Co., Inc." ], "corrections": "", "head_matter": "MALLIE HARRIS, Plaintiff v. RAY JOHNSON CONSTRUCTION CO., INC., and MARSHALL AVON McNEILL, Defendants\nNo. COA99-1049\n(Filed 29 August 2000)\n1. Attorneys\u2014 attorney-client relationship \u2014 settlement agreement \u2014 actual authority\nThe trial court did not err by concluding that plaintiff\u2019s attorney had actual authority to enter into a settlement agreement on his client\u2019s behalf for $2000 for injuries arising out of an automobile accident, because the attorney reasonably believed at the time of negotiation that he could settle the case for this gross amount, and only in hindsight did it become clear that the attorney and his client had not reached a clear agreement as to the proper amount based on a difference between the net and gross amount.\n2. Compromise and Settlement\u2014 oral acceptance by plaintiffs attorney \u2014 binding on all parties\nThe trial court did not err by concluding that plaintiff was bound by her attorney\u2019s oral acceptance of a settlement agreement for injuries arising out of an automobile accident and that a binding agreement was reached as to all parties, because plaintiff\u2019s claim was premised on joint and several liability seeking to recover for a single indivisible injury, which necessarily operated to terminate the controversy as to both defendants.\nAppeal by plaintiff from order entered 14 May 1999 by Judge Henry V. Barnette in Harnett County Superior Court. Heard in the Court of Appeals 15 May 2000.\nBrenton D. Adams for the plaintiff-appellant.\nCranfill, Sumner & Hartzog, L.L.P., by H. Lee Evans and F. Marshall Wall, for the defendant-appellee Ray Johnson Construction Co., Inc." }, "file_name": "0827-01", "first_page_order": 859, "last_page_order": 863 }