Renewal By Andersen LLC v. Fillar

Filing 45

Memorandum Opinion and Order. Related doc # 15 ). An enforceable agreement exists to settle this case on the terms set out in this memorandum opinion and order that Marco had Fillar's express authority to agree to. Renewal's motion to enforce the settlement agreement contained in the email exchange between Attorneys Lewis and Marco of 10/2/15 is granted to the extent of declaring an enforceable contract as to those terms that Marco had Fillar's express authority to agree to. Otherwise the motion is denied. (Related doc # 40 ). In consideration of that settlement, this action is dismissed with prejudice. A separate judgment entry will issue. (Signed by Magistrate Judge William H. Baughman, Jr on 10/30/15. (H,D)

IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

RENEWAL BY ANDERSEN LLC,

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Plaintiff,
v.
GREGORY J. FILLAR,
Defendant.

CASE NO. 1:15 CV 1117
MAGISTRATE JUDGE
WILLIAM H. BAUGHMAN, JR.

MEMORANDUM OPINION
AND ORDER

Introduction
In this diversity case the plaintiff, Renewal By Andersen LLC, has sued the defendant,
Gregory J. Fillar, for breach of an employment agreement. The parties have consented to my
jurisdiction.1
I had set this case for jury trial beginning on October 26, 2015.2 In advance of the
final pretrial scheduled for October 19, 2015,3 the parties engaged in settlement negotiations
through their respective attorneys. Although counsel reported to the Court that the parties
had agreed to a settlement, a dispute has since arisen as to whether an agreement exists and,
if one does, the terms of that agreement.

1

ECF #15.

2

ECF #28.

3

ECF #28.

Renewal has filed a motion to enforce a settlement agreement.4 I issued an order
permitting a response5 but Fillar did not file one. Nevertheless, I conducted an evidentiary
hearing on the motion to enforce and have taken the motion under advisement.6
As explained below, because I conclude that the parties did enter into an enforceable
settlement agreement, but also conclude that such agreement includes some but not all of the
terms advocated by Renewal, I will grant the motion to enforce in part and deny it in part.
Statement of the Case
Renewal’s complaint seeks damages and injunctive relief in large part related to the
alleged breach of an employment agreement by Fillar.7 The parties do not dispute that Fillar
resigned from his employment with Renewal in April of 2015 and subsequently accepted
employment with Unique Home Solutions. Renewal has not joined Unique as a party in this
case.
In anticipation of an October 26, 2015, jury trial date, and the court-imposed
preparation requirements for the trial, the parties entered into settlement negotiations. On
October 2, 2015, Fillar’s counsel contacted the Court to advise that the parties had agreed to
a settlement.8 In a telephone status conference conducted on October 8, 2019, counsel
4

ECF #40.

5

ECF #38.

6

ECF #44.

7

ECF #1.

8

Renewal Hearing Exhibit ( R.Ex. B)

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confirmed the report of settlement but, advised that the parties had not yet signed the
settlement agreement.9 I, therefore, set another conference for October 14, 2015 with the
statement that the conference would be telephonic if the parties had signed the agreement by
that time.10 The trial order remained in full force and effect.11
At the conference held on October 14, 2015, counsel reported that the parties had not
signed an agreement. Fillar attended the conference and maintained that he had not agreed
to settle the case on the terms represented to the Court by counsel for Renewal and his
counsel of record. Counsel for Fillar advised of his intention to file a motion to withdraw as
counsel. Counsel for Renewal stated his client’s intention to file a motion to enforce
settlement. I then issued an order vacating the trial order and setting a date for filing of a
motion to withdraw and the motion to enforce.12 I also set a date for an evidentiary hearing
on the motion to enforce settlement.13
At that conference, I advised Fillar of his right to file an opposition to the motion to
enforce and of his right to retain an attorney of his choice to represent him going forward.
I also told Fillar that if he retained an attorney, I would schedule a status conference before

9

ECF #36.

10

ECF #36.

11

ECF #36.

12

ECF #38.

13

ECF #38.

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the hearing on the motion to enforce, if requested. Fillar did not file an opposition to the
motion to enforce or retain an attorney.
I granted the motion to withdraw as counsel filed by Fillar’s attorneys of record.14
The hearing on the motion to enforce settlement went forward as scheduled with Fillar
representing himself. One of his former counsel of record, Kenneth Marco, testified under
trial subpoena.15 Fillar also offered testimony under oath.
Statement of Facts
Based on the testimony under oath at the hearing on Renewal’s motion to settlement
and exhibits offered and admitted into evidence at that hearing, I find the following facts
established by a preponderance of the evidence.
In anticipation of the October 26, 2015, jury trial date and the preparations required
by the court order for the final pretrial conference scheduled for October 19, 2015, Patrick
Lewis, counsel for Renewal, and Kenneth Marco, counsel for Fillar, intensified ongoing
settlement discussions. These discussions culminated in an email sent to Marco by Lewis
on October 2, 2015 at 3:55 p.m.16 The text of that message sets out the principal terms of a
settlement agreement purportedly reached by the parties.

14

ECF #43.

15

ECF #42.

16

R.Ex. A.

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Ken
Following up on our telephone conversation. The parties have agreed to settle
the Renewal v. Fillar matter. The principle terms are:
Fillar would not sell replacement windows and doors for Unique for a period
of 12 months from the date of the settlement agreement
Fillar would pay $5,000 upon settlement in a lump sum. Unique would add
$2,500 upon settlement in a lump sum in exchange for a release.
Fillar agrees that if he leaves employment with Unique prior to the expiration
of the 12 month period he would honor the remainder of the 12 month period
and would refrain from employment in the sale of replacement doors and
windows for the remainder of that period in the geographical area of Cuyahoga
County and all bordering counties.
Thanks 17

Marco purportedly replied by a message dated October 2, 2015 at 4:04 p.m
Patrick,
That is my understanding of the agreement. I already contacted the court and
informed them that we have reached an agreement. Enjoy your weekend.18
At some point before sending the reply email, Marco had discussed with Fillar the
restriction on selling replacement doors and windows for Unique for 12 months from the date
of settlement and the payment of $5,000. Fillar agreed to these terms as his only option.
Marco did not discuss with Fillar the $2,500 payment by Unique.19
17

Id.

18

R.Ex. B.

19

Renewal has not joined Unique as a defendant in this case. Any agreement that
Renewal and Unique may have entered into has no bearing on the pending motion to enforce

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Fillar asked Marco what would happen if he resigned from Unique. Marco responded
that he could not guarantee that Renewal would dismiss the suit. Fillar communicated
directly with Lewis on this question but received no response. Marco testified that he did not
recall if he discussed the third principal term of the settlement as set out in Lewis’s message a 12-month restriction on employment on the sale of replacement doors and windows in the
event that Fillar leaves Unique - before he replied to Lewis’s message.
Lewis prepared a written settlement agreement based on the email exchange with
Marco.20 Marco presented it to Fillar, who refused to sign it because of the continuing
restriction on sales activity should he leave Unique. Unique then terminated Fillar.
Fillar testified that Marco did not present the post-Unique continuing restriction
settlement term to him before the October 2, 2015, email exchange between Lewis and
Marco. He believed, as of October 2, 2015 based on Marco’s statements and Lewis’s silence,
that the settlement would not address that matter, then speculative only because he remained
a Unique employee.

a settlement agreement between Renewal and Fillar.
20

R.Ex. D.

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Analysis
1. Applicable Law
This Court has jurisdiction to enforce a settlement agreement, even if not reduced to
a writing signed by the parties, while the underlying case remains pending.21 This includes
oral settlement agreements made off the record and not in the presence of the Court.22 The
Court’s finding of fact on a motion to enforce settlement must be upheld unless clearly
erroneous.23
Where the settlement at issue was negotiated in Ohio, Ohio law applies.24 Under Ohio
law, the retention of an attorney to negotiate and settle a claim gives the attorney no implied
or apparent authority absent the expressed authority of the client.25 A client’s provision of
express authority also gives his attorney implied authority to do anything “reasonably
21

Graley v. Yellow Freight Systems, 221 F.3d 1334, 2000 WL 799779, at 4 (6th Cir.
June 14, 2000) (unreported table decision); Hinton v. Trinity Highway Products, LLC.,
4:12CV1063, 2012WL5054140, at*2 (N.D. Ohio Oct. 18, 2012).
22

Id.

23

Graley, 2000 WL 799779, at *3.

24

Hinton, 2012 WL 5054140, at *2.

25

Id. As Judge Vecchiarelli explained in Hinton, the Sixth Circuit’s decision in Capital
Dredge and Dock Corp., v. City of Detroit, 800 F.2d 525, 530 (6th Cir. 1986) applied
Michigan law, which recognizes the principle that the hiring of an attorney and holding of
that attorney out as counsel in a matter clothes the attorney with apparent authority to settle
a claim connected with that matter. Ohio law, however, has not embraced that principle. Id.
at *3. Renewal relies upon the Sixth Circuit decision in Noga v. Parts Associates Inc., 205
F.3d 1341, 2000 WL 178385, at *4 (6th Cir. Feb. 8, 2000)(unpublished table decision), which
cited Capital Dredge with approval. The Michigan rule, despite the certainty that it may
bring to disputes over settlement agreements, is not the law in Ohio.

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necessary to carry into effect the power actually conferred.”26 The determination of a client’s
express authority to settle his claim “maybe ascertained from the surrounding
circumstances.”27
2. Express Authority to agree to settlement terms for payment of $5,000 and 12 month
restriction during employment with Unique
Lewis’s email identified the first two of three principal terms:
•

a restriction on selling replacement doors and windows for Unique for
a 12-month period after the date of the settlement agreement, and

•

payment of a lump sum of $5,000.

Renewal has established by a preponderance of the evidence that Marco had the
express authority to agree to a settlement incorporating those terms. Marco and Fillar
discussed those terms before Marco sent the confirming email, and Fillar agreed to a
settlement of these terms as his only option. From the surrounding circumstances Fillar’s
consent to a settlement involving restrictions on his employment with Unique and a lump
sum payment has been established.28
3. Express authority to agree to a settlement term restricting employment after employment
by Unique.
But Renewal has not proven by a preponderance of the evidence that Marco had
express authority to agree to the third principal term of settlement set out in Lewis’s email

26

Rubel v. Lowe’s Home Centers, Inc., 597 F. Supp.2d 742, 745 (N.D. Ohio 2009).

27

Id.

28

Id.

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message - a restriction on employment in the event Fillar left Unique. Fillar questioned
Marco about what would happen if he left Unique’s employ. Marco told him that he could
give no guarantees. Fillar posed the same question in direct communications to Lewis, which
went unanswered. Based on this undisputed evidence, I cannot find that Fillar expressly
authorized Marco to agree to this term.
4. The materiality of the term restricting Fillar’s employment after leaving Unique
The failure of the term restricting Fillar’s employment if he left Unique within 12
months of settlement does not prevent the formation of a enforceable settlement agreement.
Fillar’s employment agreement with Renewal contains a two year restriction on competitive
activities from the date of termination of his Renewal employment.29 Fillar resigned from
Renewal in April of 2015.30 The restriction would run to April of 2017. The restriction on
post-Unique employment in the putative settlement would only extend to October or
November 2016. The restriction in the settlement referred to in counsel’s email exchange
is less favorable to Renewal than the one in the employment agreement.
Furthermore, the written memorialization of the settlement prepared by Renewal’s
counsel, which Fillar refused to sign, contains a severability clause providing that “if any part
of it (the agreement) is found unenforceable, the other parts remain valid and enforceable.31
This evidence supports the conclusion that the post-Unique employment restriction does not
29

ECF #1, Exhibit A, ¶ 9.

30

ECF #1, ¶ 11.

31

R.Ex. D, ¶ 11.

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constitute a material term barring enforcement of portions of the agreement entered into in
by counsel for Fillar with express authority of his client
Conclusion
Marco, counsel for Fillar, had Fillar’s express authority to agree to the settlement of
this case for a lump sum payment of $5,000 and a restriction that Fillar not sell replacement
doors and windows for Unique for a period of 12 months from the date of the settlement
agreement. Marco did not have Fillar’s express authority to agree to any restriction of
employment or sales activity in the event that Fillar left Unique’s employment during the 12month period.
Accordingly, I conclude that:
•

An enforceable agreement exists to settle this case on the terms set out above
that Marco had Fillar’s express authority to agree to.

•

Renewal’s motion to enforce the settlement agreement contained in the email
exchange between Attorneys Lewis and Marco of October 2, 201532 is granted
to the extent of declaring an enforceable contract as to those terms that Marco
had Fillar’s express authority to agree to. Otherwise the motion is denied.

•

In consideration of that settlement, this action will be dismissed with prejudice.

A separate judgment entry will issue.
IT IS SO ORDERED.

Dated: October 30, 2015

s/ William H. Baughman, Jr.
United States Magistrate Judge

32

R.Ex. A, R.Ex. B.

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