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Murra v. Farrauto
85 N.E.3d 1231
Ohio Ct. App.
2017
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Background

  • Murra sued Farrauto, her husband, and Bright Star Academy alleging partnership and related claims; defendants asserted Murra was an employee, not a partner.
  • At the January 25, 2016 trial setting the parties put an agreement on the record: defendants would pay $35,000 within 30 days and $20,000 in additional quarterly payments over 36 months; plaintiff would dismiss with prejudice (except enforcement of payments).
  • The court issued a Notice of Settlement requiring counsel to prepare an entry; counsel exchanged drafts but could not agree on language — plaintiff’s draft added terms (interest/penalties and a new payee) not stated on the record.
  • Communications broke down and plaintiff moved to enforce the oral settlement as stated on the record, alleging defendants had repudiated by demanding additional terms.
  • After a conference and submission of competing entries, the trial court found defendants’ draft did not conflict with the record terms, filled in nonessential payment and release details, and entered a settlement (detailing payment schedule, mail/payee instructions, mutual release, and retention of jurisdiction).
  • Plaintiff appealed, arguing the court improperly allowed defendants to repudiate the on-the-record agreement and adopted terms never agreed to by plaintiff.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether defendants repudiated the oral on-the-record settlement Murra: the on-the-record agreement was binding; any later added terms were unilateral repudiation and the court erred by adopting them Farrauto: no repudiation; parties negotiated wording and requested court to resolve nonessential details Court: no evidence of clear, unequivocal repudiation; basic economic terms were agreed and court permissibly supplied nonessential details to effectuate the settlement
Whether the trial court could fashion and enter additional settlement terms Murra: court substituted terms never proposed or accepted, prejudicing him Farrauto: court may adopt reasonable, nonconflicting provisions to avoid ambiguity and effectuate parties’ intent Court: where parties intended to be bound, trial court may fill in less-essential terms; the entry mirrored the record and added boilerplate/payment mechanics, so no error

Key Cases Cited

  • Continental W. Condominium Unit Owners Assn. v. Howard E. Ferguson, Inc., 74 Ohio St.3d 501 (1996) (settlement agreements are contracts and enforceable if they include essential elements)
  • In re All Kelley & Ferraro Asbestos Cases, 104 Ohio St.3d 605 (2004) (standards for when courts may enforce settlements)
  • McDonald v. Bedford Datsan, 59 Ohio App.3d 38 (Eighth Dist. 1988) (repudiation must be clear and unequivocal; mere request for change not necessarily repudiation)
  • Mr. Mark Corp. v. Rush, Inc., 11 Ohio App.3d 167 (1983) (an agreement is enforceable if it contains the essential elements; less-essential terms can be resolved later)
  • Litsinger Sign Co. v. American Sign Co., 11 Ohio St.2d 1 (1967) (courts may supply omitted provisions necessary to effectuate parties’ intent)
Read the full case

Case Details

Case Name: Murra v. Farrauto
Court Name: Ohio Court of Appeals
Date Published: Mar 9, 2017
Citation: 85 N.E.3d 1231
Docket Number: 16AP-347
Court Abbreviation: Ohio Ct. App.