Matter of Philadelphia Ins. Indem. Co. v. Kendall, 2021 NY Slip Op 04284

Background

On June 6, 2014, Erika Kendall was injured in a motor-vehicle collision; she recovered $25,000 from the tortfeasor's policy and sought Supplementary Underinsured Motorist (SUM) benefits from her employer's insurer, Philadelphia Insurance Indemnity Co.
The SUM claim proceeded to arbitration; the arbitrator issued a $975,000 award on September 16, 2019 (SUM limit of $1,000,000 less the $25,000 recovered).
On September 19, 2019, counsel exchanged emails in which Kendall's counsel stated "Confirmed -we are settled for 400K," and Philadelphia's counsel sent a Release and Trust Agreement and urged quick execution.
Before Kendall signed the release, her counsel repudiated the $400,000 settlement and demanded the $975,000 award; Philadelphia filed a special proceeding to enforce the settlement and to vacate the arbitration award.
Supreme Court denied enforcement, finding the email was not "subscribed" under CPLR 2104 because the signature block appeared prepopulated and that execution of the release was a condition precedent; the Appellate Division reversed.
The First Department held that an email transmission with intent to settle suffices for subscription under CPLR 2104 (no requirement to retype a signature), and that execution of the release was ministerial rather than a condition to formation; the petition to enforce was granted.

Issues

Issue	Philadelphia's Argument	Kendall's Argument	Held
Whether an email exchange can be a writing "subscribed" under CPLR 2104	An attorney's sent email indicating acceptance is a subscribed writing; no need to retype a signature	The email block was prepopulated; retyping one's name is required to show subscription	Sending an email with intent to settle suffices; no separate retyped signature required for subscription
Whether the parties' email exchange included all material terms (was a binding settlement)	The material term (settlement amount) was agreed ($400,000); the release was ministerial documentation	Settlement was conditioned on Kendall signing the Release and Trust Agreement	The $400,000 agreement was binding; signing the release was a ministerial condition precedent to payment, not to formation
Whether the email's authenticity or attorney intent defeated enforcement	Subsequent emails and counsel conduct show intent; attorney ethical duties support reliability	An email signature could be generated automatically or hacked; authentication could fail	Emails are presumptively authentic but may be rebutted; here authentication and intent were established
Whether mutual mistake or the intervening arbitration award voided the agreement	The award was ascertainable and did not create a mutual mistake that voided the settlement	The existence/entry of the arbitrator's award undermined the settlement agreement	Mutual mistake doctrine did not apply; award availability did not negate the binding email settlement

Key Cases Cited

Bonnette v. Long Is. Coll. Hosp., 3 N.Y.3d 281 (Court of Appeals 2004) (CPLR 2104 requires written agreement subscribed by party or attorney)
Parma Tile Mosaic & Marble Co. v. Estate of Short, 87 N.Y.2d 524 (Court of Appeals 1996) (preprogrammed fax name did not satisfy subscription requirement)
Forcelli v. Gelco Corp., 109 A.D.3d 244 (App. Div. 2d Dep't 2013) (found emails binding where sender retyped name in message)
Kowalchuk v. Stroup, 61 A.D.3d 118 (App. Div. 1st Dep't 2009) (release as documentation of an already-binding agreement)
Trolman v. Trolman, Glaser & Lichtman, P.C., 114 A.D.3d 617 (App. Div. 1st Dep't 2014) (distinguishing agreements that are contingent on later documents)
Bayerische Landesbank v. 45 John St. LLC, 102 A.D.3d 587 (App. Div. 1st Dep't 2013) (prepopulated email signature held insufficient for subscription)
Princeton Indus. Prods., Inc. v. Precision Metals Corp., 120 F. Supp. 3d 812 (N.D. Ill. 2015) (criticizing requirement that a name be retyped and noting practical issues with automated signatures)