Pisarz v. PPL Corporation
MEMORANDUM (Order to follow as separate docket entry) - Re defendant PPL Corporation's motion to enforce settlement, filed 12/28/2012, ECF No. 85.Signed by Honorable Matthew W. Brann on 1/21/14. (km)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
GEORGE J. PISARZ, JR.,
Case No. 4:10-cv-01432
January 21, 2014
For the reasons that follow, defendant PPL Corporation’s motion to enforce
settlement (Dec. 28, 2012, ECF No. 85) is granted.
On December 28, 2012, defendant PPL Corporation (hereinafter, “PPL”)
moved to enforce what it maintained was a valid settlement agreement with plaintiff
George J. Pisarz, Jr. In a Memorandum and Order dated April 19, 2013, the Court
held that PPL’s motion “must be denied at this time” because “the Court has
determined that there is a genuine dispute as to whether Pisarz’s counsel possessed
[settlement] authority when the terms of the settlement were agreed upon.” (ECF
No. 99 at 6). In order to resolve the dispute, the Court scheduled an October 15,
2013 evidentiary hearing, which was later continued to November 26, 2013.
This memorandum sets forth the Court’s findings of fact – which the Court
makes on the basis of the evidence admitted at the November 26, 2013 hearing –
and conclusions of law.
PPL, as the party seeking to enforce a purportedly valid settlement
agreement, bears the burden of proving that Mr. Pisarz granted the authority to enter
into the agreement to his attorney. See Mowrer v. Warner-Lambert Co., 2000 WL
974394, at *5 (E.D. Pa. July 13, 2000). Under the law of Pennsylvania, which
applies here, it is “clear and well-settled that an attorney must have express
authority in order to bind a client to a settlement agreement.” Reutzel v. Douglas,
582 Pa. 149, 870 A.2d 787, 789-90 (2005). “Express authority” empowering an
attorney to settle a client’s claim “must be the result of explicit instructions
regarding settlement.” Tiernan v. Devoe, 923 F.2d 1024, 1033 (3d Cir. 1991). See
also Restatement (Second) of Agency § 7 cmt. c (1958) (“It is possible for a
principal to specify minutely what the agent is to do. To the extent that he does this,
the agent may be said to have express authority. But most authority is created by
implication . . . from the words used, from customs and from the relations of the
parties.”). Accordingly, the Court’s task is to determine whether PPL has shown, by
a preponderance of evidence, that Mr. Pisarz explicitly instructed his counsel to
agree to the settlement reached with PPL.
Findings of Fact
On October 16, 2012, counsel for PPL, Darren Creasy, Esquire, informed the
Court that “this matter [i.e. Pisarz v. PPL Corp.] has been resolved by agreement of
the parties, subject to the execution of a Settlement Agreement.” (ECF No. 81).
Indeed, in an e-mail dated October 11, 2012, counsel for Mr. Pisarz, Timothy
Kolman, Esquire, of the law firm Kolman Ely P.C. (hereinafter, “Kolman Ely”),
confirmed “acceptance of PPL’s settlement offer of $145,000 (one hundred forty
five thousand dollars) in full and complete settlement of any and all claims.” (Def.
Ex. 7). In addition, Mr. Kolman assented to the following: “Mr. Pisarz will also
receive pension credit for years of service from 2008 through the date of agreement
(which will be deemed his retirement/resignation date). Mr. Pisarz’s acceptance of
this offer includes the execution of a general release and settlement agreement,
which we [PPL] will prepare, as well as all non-financial terms and conditions
previously discussed.” (Id.).
That much is agreed. The parties’s dispute involves whether Mr. Pisarz
expressly authorized Mr. Kolman to assent to the settlement, particularly the portion
requiring Mr. Pisarz to retire/resign on the date of the settlement agreement. Mr.
Pisarz claims that no later than June 12, 2012, he notified Kolman Ely that he would
“not retire,” and that he would, rather, “stay on [workers’ compensation] for
insurance and medical reasons,” as well as to sustain “pension accruals” that
continued only so long as Mr. Pisarz was on workers compensation (i.e., not
retired). (Pl. Ex. 3; Pisarz Test., Tr. at 69-70). (The Court notes that PPL disputes
whether Mr. Pisarz properly understands the relationships between workers
compensation, pension accruals, insurance, et cetera). Likewise, he maintains that
on September 22, 2012 he told his counsel, Kolman Ely’s Laura Siegle, that he
would “not give up [his] [sic] workman’s compensation because of the benefits that
go with it,” and that this point was “not negotiable.” (Pisarz Test., Tr. at 69).
The Court finds that, although Mr. Pisarz held concerns regarding the effect
of a settlement with PPL on the benefits he associated with workers’ compensation,
and expressed these concerns to Kolman Ely in various ways at various times, Mr.
Pisarz had granted Mr. Kolman authority to settle his case on the terms agreed to
with PPL on October 11, 2012. The Court finds the material facts to be as follows:
On September 12, 2012, at 3:25 p.m., Ms. Siegle made a purely
financial1 settlement demand ($250,000) of PPL. (Siegle Test., Tr. at 78; Def. Ex. 1).
By “purely financial,” the Court means that the settlement would not
provide for Mr. Pisarz to remain a PPL employee; i.e., he would retire as of the
date of settlement.
On September 12, 2012, at 4:04 p.m., after speaking with Mr. Pisarz,
Ms. Siegle made a purely financial settlement demand ($500,000) of
PPL. (Siegle Test., Tr. at 8-9; Def. Ex. 2).
When Ms. Siegle made the settlement demands of September 12, 2012,
she made them after reasonably concluding that she had the express
authorization of Mr. Pisarz, who manifested an understanding that the
offers were “in terms of money only.” (Pisarz Test., Tr. at 86).
At a September 18 or 19, 2012 pretrial conference, Ms. Siegle, in the
presence of Mr. Pisarz and after reasonably concluding that she acted
with his express authorization, made a purely financial settlement
demand of PPL. (Siegle Test., Tr. at 11-12).
When Ms. Siegle made a settlement demand on September 18 or 19,
2012, Mr. Pisarz did not inform her that she had misrepresented his
authority. (Siegle Test., Tr. at 12).
On September 22, 2012, Ms. Siegle met with Mr. Pisarz and, after
discussing the interaction between Mr. Pisarz’s workers’ compensation
benefits and a potential settlement with PPL, Siegle reasonably
concluded that she was expressly authorized to settle his case on purely
financial terms so long as Mr. Pisarz’s pension accruals (which he
associated with his status as a recipient of workers’ compensation)
would continue until the date of settlement/retirement.2 (Siegle Test.,
Tr. at 21-22; Pisarz Test., Tr. at 69, 71, 87-88).
On September 25, 2012, after speaking with Mr. Pisarz, Ms. Siegle
made a purely financial settlement demand ($300,000) of PPL. (Siegle
Test., Tr. at 10; Def. Ex. 3).
When Ms. Siegle made the settlement demand of September 25, 2012,
she did so after reasonably concluding that she had the express
authorization of Mr. Pisarz, who manifested an understanding that the
offer was “in terms of money only.” (Pisarz Test., Tr. at 86).
The Court concludes this meeting occurred on September 22, 2012 based on
the following. Mr. Pisarz and Ms. Siegle met for the first time at a pretrial
conference on September 18 or 19, 2012. (See ECF No. 69; Siegle Test., Tr. at 14;
Pisarz Test., Tr. at 68). Mr. Pisarz communicated his desire to remain on workers’
compensation to Ms. Siegle on one of two Saturdays afterward – September 22 or
29, 2012 – the only two Saturdays “shortly before the case was headed for trial” on
October 1, 2012. (Siegle Test., Tr. at 14; Pisarz Test., Tr. at 68; ECF Nos. 57 &
75). It is unlikely that Siegle met with Pisarz “for the purpose of preparing him to
testify at trial” (Siegle Test., Tr. at 14) on September 29, 2012, because Judge
Yvette Kane ordered an indefinite continuance of trial on September 28, 2012.
Likewise, it is unlikely that Siegle met with Pisarz on September 29, 2012, because
by that time she had largely handed the case off to Mr. Kolman who, by Tuesday,
October 2, 2012, was familiar enough with Pisarz to write a lengthy letter to him
out of frustration that Pisarz had rebuffed his (Kolman’s) attempts to discuss the
case. (Kolman Test., Tr. at 30). Finally, Pisarz himself remembered the date as
September 19 or 20, 2012, which is closer to September 22, 2012. (Pisarz Test., Tr.
at 87). Accordingly, the Court concludes that Pisarz communicated his desire to
remain on workers’ compensation to Siegle on September 2, 2012.
Soon after September 25, 2012, Ms. Siegle’s colleague, Mr. Kolman,
took control of representing Mr. Pisarz in his (Pisarz’s) case against
PPL. (Kolman Test., Tr. at 28).
After Mr. Pisarz rebuffed Mr. Kolman’s attempts to discuss Pisarz’s
case against PPL, Kolman sent Pisarz a letter on October 2, 2012.
(Kolman Test., Tr. at 29, 49).
The letter explained, “This firm, through great efforts, has persuaded
Defendant PPL to pay the significant sum of $125,000.00. They have
agreed to full pension accrual (as though you had been working to
date). They have agreed that this settlement will not affect your
[workers’ compensation] claims/recoveries.” (Def. Ex. 5).
Mr. Pisarz received the October 2, 2012 letter from Mr. Kolman.
(Pisarz Test., Tr. at 72).
From the October 2, 2012 letter sent to him by Mr. Kolman, Mr. Pisarz
may or may not have understood that an aspect of the proposed
settlement would be accrual of his pension credits up to the date of
settlement/retirement. (Pisarz Test., Tr. at 90-91).
Mr. Kolman and Mr. Pisarz spoke by telephone on October 5, 2012.
(Pisarz Test., Tr. at 73-75).
On the October 5, 2012 call, Mr. Kolman and Mr. Pisarz discussed the
settlement terms set forth in Kolman’s October 2, 2012 letter, and
Pisarz manifested an understanding that the terms provided for pension
accrual up to the date of settlement/retirement. (Kolman Test., Tr. at
34-35; Pisarz Test., Tr. at 90-91).
Mr. Pisarz otherwise did not raise the issues of pension accrual,
insurance, or retirement on the call. (Kolman Test., Tr. at 29, 31-32,
Mr. Kolman reasonably concluded that Mr. Pisarz expressly assented
to the settlement terms communicated in the October 2, 2012 letter,
including pension accrual up to the date of settlement/retirement, and
Kolman ultimately recorded assent to the settlement terms set forth in
the October 2, 2012 letter from Kolman to Pisarz. (Kolman Test., Tr. at
34-36; Pisarz Test., Tr. at 90-91).
Mr. Kolman and Mr. Pisarz did not speak between October 6, 2012
and October 11, 2012, the date upon which Kolman agreed to settle the
case with PPL. (Pisarz Test., Tr. at 75).
On October 11, 2012, Mr. Kolman agreed to settle Mr. Pisarz’s case
against PPL on terms memorialized in an e-mail of that date. (Def. Ex.
Mr. Kolman sent Mr. Pisarz a letter, dated October 12, 2012, to notify
Pisarz that his case had been “resolved for $145,000, including the
pension portion which was previously communicated to you.” (Def.
By referring to “the pension portion which was previously
communicated to you,” Mr. Kolman intended to reference his previous
communication by letter of October 2, 2012, in which he wrote that
PPL “agreed to full pension accrual (as though you had been working
to date).” (Kolman Test., Tr. at 38-39).
Mr. Pisarz may or may not have understood that, by referring to “the
pension portion which was previously communicated to you,” Mr.
Kolman was referencing accrual of Pisarz’s pension up to the date of
settlement/retirement. (Pisarz Test., Tr. at 91).
On October 18, 2012, Mr. Pisarz wrote a letter to Mr. Kolman. (Pl. Ex.
The October 18, 2012 letter stated: “I received your letter dated [sic]
10/18/12. You mentioned [sic]; that the case is resolved for $145,000,
including the pension portion which was communicated to you. I
would like that clarified to state in the agreement that my pension will
continue to accrue as it was prior to the lawsuit.” (Pl. Ex. 9).
Mr. Kolman believed he did not need to act on Mr. Pisarz’s October
18, 2012 letter because, by the terms of the settlement Kolman reached
with PPL, Pisarz’s pension would continue to accrue through the date
of settlement/retirement, which is what Kolman thought Pisarz was
writing to ensure. (Kolman Test., Tr. at 56).
Underlying the Court’s enumerated findings are two ancillary findings: (1)
that Mr. Pisarz’s counsel, both Ms. Siegle and Mr. Kolman, continually endeavored
to be faithful to Pisarz’s wishes regarding settlement (Siegle Test, Tr. at 9, 12, 19,
21-22; Kolman Test., Tr. at 27-28, 34-36); and (2) that Siegle and Kolman appear to
be highly competent attorneys as a general matter, and, in Kolman’s case, highly
experienced. (Siegle Test., Tr. at 14; Kolman Test., Tr. at 25-26).
Conclusions of Law
It is worth remembering that the Court’s inquiry is limited to determining
whether Mr. Pisarz granted his counsel express authority to settle his case on the
terms memorialized by Mr. Kolman and PPL’s counsel in an October 11, 2012 email. The inquiry does not concern Pisarz’s private desires. Only his public
manifestations of consent (or lack thereof) to the settlement are relevant.
Further, although Pennsylvania’s rule requiring attorneys to obtain express
settlement authority is intended to ensure that clients do not “forfeit substantial
legal rights” unknowingly, Reutzel, 870 A.2d at 790, attorneys are not expected to
be telepathists or even infallible interpreters of clients’s verbalized communications.
An attorney is, rather, expressly authorized to settle a client’s case “if he is
reasonable in drawing an inference that the [client] intended him so to act although
that was not the [client’s] intent.” Restatement (Second) of Agency § 7 cmt. b. The
rule requiring attorneys to obtain express settlement authority provides limited
protection for clients; namely, it does not protect clients against the risk of
reasonable misapprehension attendant on even careful use of the English language.
With these principles in mind, it should be clear from the Court’s factual
findings supra that the Court holds that Mr. Pisarz granted Kolman Ely express
authority to reach the October 11, 2012 settlement with PPL. That is to say, by a
preponderance of the evidence, PPL has carried its burden of showing that, whether
Pisarz’s true intention or not, Kolman Ely attorneys (including Mr. Kolman on the
date of settlement) were reasonable in inferring from Pisarz’s express
communications that he (Pisarz) granted them authority to settle on the terms
reached with PPL on October 11, 2012. Accordingly, the settlement should be
enforced in the absence of other reasons for non-enforcement.
Mr. Pisarz does raise one additional argument for non-enforcement. He
contends that execution of a formal settlement agreement was a condition precedent
to settlement. The Court disagrees. As set forth supra, Pisarz and PPL agreed to the
essential terms of settlement on October 11, 2012, in an e-mail stating:
Please allow this e-mail to confirm Mr. Pisarz’s acceptance of PPL’s
settlement offer of $145,000 (one hundred forty five thousand dollars) in
full and complete settlement of any and all claims, including claims for
attorney’s fees, interest, costs, etc. Mr. Pisarz will also receive pension
credit for years of service from 2008 through the date of agreement
(which will be deemed his retirement/resignation date). Mr. Pisarz’s
acceptance of this offer includes the execution of a general release and
settlement agreement, which we will prepare, as well as all non-financial
terms and conditions previously discussed.
(Def. Ex. 7). Like the parties in Forte Sports, Inc. v. Toy Airplane Gliders of Am.,
Inc., 371 F. Supp. 2d 648 (E.D. Pa. 2004), who agreed to execute an “appropriate
agreement” to formalize terms already agreed to, id. at 648, the parties here made it
relatively clear in the October 11, 2012 e-mail that the purpose of any future
settlement agreement would be merely to formalize what had been “previously
discussed.” A fair reading of the e-mail fails to suggest any desire of the parties to
risk all the fruits of negotiations theretofore on the contingency of each other’s
second thoughts or the success of further negotiations. Thus, just as in Forte Sports,
the e-mail “cannot be reasonably interpreted to mean that a signed writing
incorporating its terms was a condition precedent.” Id. at 650. See also Wineburgh
v. Wineburgh, 2002 Pa. Super. 415, 816 A.2d 1105, 1109 (2002) (“[W]hile the
parties to a contract need not utilize any particular words to create a condition
precedent, an act or event designated in a contract will not be construed as
constituting one unless that clearly appears to have been the parties’ intention.”)
(quoting Davis v. Gov’t Emp. Ins. Co., 2001 Pa. Super. 140, 775 A.2d 871, 874
For the foregoing reasons, defendant PPL Corporation’s motion to enforce
settlement (Dec. 28, 2012, ECF No. 85) is granted.
BY THE COURT:
s/ Matthew W. Brann
Matthew W. Brann
United States District Judge
There is a consequential distinction between the circumstances in Mizutania
v. Happy Huckster, Corp., 847 F. Supp. 2d 702 (E.D. Pa. 2012), and those here.
There, counsel for the defense “insisted” that, before defense counsel would remit
$7,000 in settlement, the plaintiff had to sign the release he (defense counsel) had
already drafted and sent to plaintiff’s counsel. The release he had sent to plaintiffs
counsel, moreover, provided for a 21-day signing period and a 7-day revocation
period. Here, on the other hand, nothing in the October 11, 2012 e-mail indicates
that PPL was extra-sensitive to the particular form of general release and
settlement agreement Mr. Pisarz would sign, or that PPL intended to give Pisarz a
signing and revocation period. PPL merely undertook to prepare formal
documentation (which ultimately did include a signing and revocation period).
There is nothing in the parties’s October 11, 2012 e-mail exchange to suggest that
the parties’s obligations were conditioned upon the prior execution of a general
release and settlement agreement.
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