The Inadvertent Settlement Agreement (And How To Avoid It)

The recent case of Jarvis v. BMW of North America, LLC  is an important reminder to attorneys to avoid inadvertently reaching a settlement agreement that is unacceptable to the client, or equally problematic, one that is missing critical (but not legally "essential") terms and conditions. In Jarvis, the District Court for the Middle District of Florida granted the defendant's motion to enforce a settlement agreement that had been negotiated by the parties through their respective counsel – even though the plaintiffs refused to sign the agreement.

As the Jarvis court noted, "Florida law is clear that a settlement agreement may be reached through a series of email exchanges." Id. at 5. Unless Florida's statue of frauds applies (and it often does not) execution of a memorialized agreement is a "mere formality." Id. Other jurisdictions similarly hold that email exchanges can constitute enforceable settlement agreements. See, e.g., Forcelli v Gelco Corp.