Breech v. Liberty Mut. Fire Ins. Co.
101 N.E.3d 1199
Ohio Ct. App.2017Background
- Storm damaged Lois Breech’s home; First Response Restoration tarped the roof. Breech’s grandson (POA) and Finnicum adjusted the claim; insurer Liberty Mutual involved.
- Mediation in Stark County (Aug 25, 2016) produced a confidential mediation report stating the case settled contingent on confidential terms; no written, integrated release was signed by Breech.
- First Response (through counsel Farnan) proposed a release that would also free its insurer, Crum & Forster, which participated by phone; Breech’s counsel refused language releasing Crum & Forster.
- First Response moved to enforce the settlement; the trial court held an evidentiary hearing, heard testimony from defense counsel (no testimony from Breech or her POA), and entered an interlocutory order (Nov 18, 2016) enforcing a settlement that included a release of Crum & Forster.
- Trial court then dismissed First Response with prejudice (Dec 22, 2016). Breech appealed the Dec 22 order; the appellate court found it had jurisdiction to review the interlocutory enforcement order merged into the final judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether parties reached a meeting of the minds on settlement term releasing Crum & Forster | Breech: No meeting of minds—release of Crum & Forster was an essential term and was unresolved | First Response: Release of the insurer is customary; parties intended to release insurer who paid settlement; court may enforce | Reversed: No meeting of the minds on the essential term releasing Crum & Forster; trial court erred in imposing that release |
| Whether trial court erred admitting testimony of First Response’s counsel at enforcement hearing | Breech: Counsel’s testimony should have been barred (Mentor Lagoons inquiry; Prof. Cond. R. 3.7) | First Response: Counsel’s testimony was required to prove terms and common practice | Declared moot by appellate court after reversing on first issue |
Key Cases Cited
- Noroski v. Fallet, 2 Ohio St.3d 77 (Ohio 1982) (release requires meeting of the minds)
- Continental W. Condominium Unit Owners Assn. v. Howard E. Ferguson, Inc., 74 Ohio St.3d 501 (Ohio 1996) (settlement agreements are enforceable contracts)
- Oglebay Norton Co. v. Armco, Inc., 52 Ohio St.3d 232 (Ohio 1990) (intent to be bound by contract is a question of fact)
- Rulli v. Fan Co., 79 Ohio St.3d 374 (Ohio 1997) (when existence/meaning of a settlement is disputed, an evidentiary hearing is required)
- Mr. Mark Corp. v. Rush, Inc., 11 Ohio App.3d 167 (Ohio Ct. App.) (contract binding if it encompasses essential terms; court may fashion less essential terms)
- Navistar, Inc. v. Testa, 143 Ohio St.3d 460 (Ohio 2015) (interlocutory orders merge into final judgment and may be challenged on appeal)