Hairston v. Wal-Mart Stores East, LP
2:18-cv-00619
E.D. Va.Dec 7, 2020Background
- Plaintiff Michael Hairston sued Walmart in Virginia state court for personal injuries after folding tables fell on him; Walmart removed the action to federal court based on diversity jurisdiction.
- After discovery and a settlement conference, Walmart sent a March 9, 2020 letter offering $19,000 to settle, expressly stating acceptance was "contingent upon your signing the attached release of liability agreement" (the letter attached a release).
- Hairston initially texted acceptance of $19,000, immediately asked for $20,000, Walmart agreed, and told him to meet Walmart’s lawyer on March 12 to sign and notarize the release.
- At the March 12 meeting Hairston declined to sign the release and balked at signing a W-9; he then demanded an additional $1,644.30 to cover a Medicaid lien, which Walmart refused.
- Walmart moved to enforce the alleged settlement; Hairston opposed. The Magistrate Judge held a remote hearing and applied Virginia contract law to decide whether a binding settlement existed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a binding settlement was formed | Hairston refused to sign the release, so no final acceptance occurred | Walmart contends Hairston's texts ("I accept","sounds good") manifested acceptance and created a binding settlement | No. Because Walmart expressly conditioned acceptance on execution of the release and Hairston never signed, there was no binding contract |
| Whether informal communications (texts) alone could bind parties when a formal release was required | Hairston argues mere texts are insufficient when formal execution was required | Walmart argues texts showed mutual assent and the release was a formality since the release had been provided earlier | Court found Walmart's explicit "contingent upon" language made signing a material condition, so texts alone did not suffice |
| Whether Walmart's proposed condition (signing the release) was a material term | Hairston emphasizes the absence of signature on the material term | Walmart claims the signature was ministerial and not required to create a binding deal | Court held the condition was material because it was expressly stated, making execution a condition precedent to contract formation |
| Relief requested (enforce settlement / dismiss case) | Hairston opposed enforcement; wants case to proceed | Walmart sought enforcement of the alleged settlement and dismissal | Motion to enforce denied; case to be returned to active docket for trial |
Key Cases Cited
- Golding v. Floyd, 539 S.E.2d 735 (Va. 2001) (execution of formal agreement held a condition precedent; no contract where formal writing never executed)
- Bangor-Punta Operations, Inc. v. Atlantic Leasing, Ltd., 215 Va. 180 (1974) (settlement agreements are contracts requiring acceptance of offer)
- Snyder-Falkinham v. Stockburger, 249 Va. 376 (Va. 1995) (binding settlement requires objective manifestation of parties’ intent)
- Wells v. Weston, 229 Va. 72 (Va. 1985) (party’s outward expression, not secret intent, controls meeting of the minds)
- Byrum v. Bear Inv. Co., 936 F.2d 173 (4th Cir. 1991) (settlement agreements treated as contracts under applicable state law)
- Alevromagiros v. Hechinger Co., 993 F.2d 417 (4th Cir. 1993) (choice-of-law principle: substantive law of accident situs governs in diversity action)