Client Not Bound By Settlement Negotiated By Attorney

A client is not bound by a settlement agreement negotiated by her attorney even if the opposing party believed the attorney had the authority to settle the case, the D.C. Court of Appeals has ruled in answering a certified question from the D.C. Circuit.

The client sued her former employer for sex discrimination and retaliatory firing. Both parties were ordered to attend a settlement conference, and were instructed to either attend the conference themselves or be available by telephone.

The attorney negotiated a $99,000 settlement at the conference. The client subsequently refused to sign the agreement. She claimed that she had not given the attorney the authority to settle the case absent an agreement that she would be rehired.

The employer sought to enforce the settlement agreement on the grounds mat me attorney had the apparent authority to settle the case.

But the court said that “for in-court settlement proceedings that the attorneys for the parties are ordered to attend, the client must give actual authority to settle the case in the client's absence....

“[The employer] argues [that] since [the client] held out her attorney as the person with whom [it] should deal at the settlement conference, [the] attorney possessed apparent authority to settle her claim. [[H]owever,... 'a client's manifestations of a conveyance of authority to the [opposing] party must be with respect to settlement, not the general conduct of the litigation.'... [I]f [we] followed the ruled espoused by the [employer]...'an attorney would nearly always have apparent authority to end the case despite the wishes of his client.'”

To link to the full text of this opinion, D.C. Court of Appeals. Makins v. District of Columbia, No. 02-SP-241. December 18, 2003. Lawyers Weekly USA No. 9927303, go to: http://www.lawyersweeklyusa.com/opinions