Opinion
No. 81SA265
Decided April 5, 1982.
Original Proceeding
Shelley B. Don, Bruce A. Lampert, for petitioner.
No appearance for respondents.
In this original proceeding, petitioner seeks a writ in the nature of prohibition pursuant to C.A.R. 21. We issued our rule to show cause why the relief prayed for should not be granted. We now make the rule absolute.
The petitioner is the plaintiff, and Al Harger is the defendant in a civil action filed in the District Court in and for the County of Gilpin (79CV25). In that case petitioner alleged that Harger intentionally shot him, and he claimed damages for medical expenses, lost wages, pain and suffering, and exemplary damages.
As a result of the shooting, criminal proceedings were brought against Harger in the same district court (79CR11), and the respondent judge was assigned both the civil and criminal case. Harger retained separate counsel to represent him in the civil and criminal cases.
On July 25, 1980, after a negotiated plea bargain, Harger was to be sentenced in the criminal case. Petitioner's attorney, Shelley B. Don, filed a Motion and Affidavit in that case advising the court that the petitioner had incurred medical expenses of approximately $6,900 as a result of Harger's acts, and pursuant to section 16-11-204.5, C.R.S. 1973 (1981 Supp.), restitution for actual damage should be assessed by the court as a condition of probation. The motion did not refer to the pending civil action. A copy was sent to Harger's criminal defense attorney but not to the attorney representing him in the civil action.
Section 16-11-204.5, C.R.S. 1973 (1981 Supp.), provides in part that: "As a condition of every sentence to probation, the court shall provide that the defendant make restitution to the victim of his conduct for the actual damages which were sustained. Such restitution shall be ordered by the court as a condition of probation. The amount of such restitution shall be based on the actual, pecuniary damages sustained by the victim, the ability of the defendant to pay, and the defendant's obligations to support his dependents and to meet other family obligations . . . ."
On the day set for sentencing, Harger appeared with his criminal defense attorney; and an associate in the office of petitioner's attorney, Bruce A. Lampert, was also present. During the course of the sentencing hearing, the respondent trial judge inquired as to the effect that restitution would have on the civil action. Lampert made certain statements, more fully discussed later in this opinion, which the respondent trial judge considered to be an agreement to settle the civil case. Harger was placed on probation for five years and ordered to make restitution to the petitioner of $6,900, the amount of his medical expenses.
As a result of the statements made by Lampert, civil defense counsel for Harger, who was not present at the sentencing hearing, claimed that Lampert's statements were a stipulation to settle the civil action even though, within hours after the hearing, Lampert telephoned civil defense counsel and advised him that it was not his intent to settle the civil case and that he had no authority from the petitioner to do so.
The uncontradicted affidavit of Lampert states that he appeared at the sentencing hearing for the limited purpose of requesting that restitution be ordered as a condition of probation; he had no authority from his employer, Shelley B. Don, or the petitioner to settle the civil action; and he advised civil defense counsel by telephone within hours of his return from the sentencing hearing that he did not intend to settle the civil case and had no authority to do so.
Prior to the sentencing hearing, petitioner's attorney had sent interrogatories to Harger. Harger responded to these interrogatories by invoking his Fifth Amendment right against self-incrimination. Subsequent to Harger's plea of guilty and sentencing, petitioner's attorney moved to compel discovery pursuant to C.R.C.P. 37, and a hearing was held on this motion in December 1980.
Harger's civil defense counsel argued that the statement made by the petitioner's attorney at the sentencing hearing was a settlement stipulation; and as long as Harger met the restitution payment schedule, as ordered by the trial court, no further proceedings were warranted in the civil case. He directed the respondent trial judge's attention to the transcript of the July 25 sentencing hearing where the trial judge had asked whether the petitioner would still proceed with the civil action if restitution was ordered, and Lampert had responded by stating that if regular payments of restitution were made, the petitioner would hold the civil case in abeyance and dismiss it with prejudice upon complete payment. He further argued that only in the event Harger failed to make his restitution payments could the civil proceedings be reinstituted and proceed to trial.
Counsel for the petitioner argued that Lampert misspoke at the sentencing hearing when he stated that petitioner was prepared to settle his claim for restitution of medical expenses over a period of five years. He further contended that there was no consideration for any settlement because restitution was mandated by section 16-11-204.5, C.R.S. 1973 (1981 Supp.).
During the course of the argument, the respondent trial judge stated that he didn't do anything to affect the civil case during the sentencing hearing, but there was a possibility that there was an agreement affecting the civil case announced in open court during the sentencing hearing.
The trial court ultimately ruled that Lampert's statement was evidence of an agreement between the parties to hold the civil action in abeyance and to dismiss the case if restitution was successfully completed and that Lampert should be held to his agreement. It thereupon denied petitioner's motion to compel discovery, vacated the trial date, suspended all further proceedings contingent on Harger's making restitution payments, and ordered that the case would be dismissed if restitution was successfully completed.
Petitioner filed a Motion for Review of the Court's Order pursuant to C.R.C.P. 60(b). The motion was denied.
The single issue to be resolved in this case is whether the petitioner is bound by Lampert's statement and whether a valid compromise and settlement had been entered into between the petitioner and Harger which should be enforced.
The record before us reflects that Lampert, prior to appearing at Harger's sentencing hearing, had never met, corresponded, or conversed with the petitioner and had no authority from his employer, Shelley B. Don, or the petitioner to settle petitioner's civil action for payment of medical bills pursuant to the court's order of restitution. While it is true that Lampert made the statements attributed to him, such statements were made without authorization of petitioner and were disclaimed by Lampert within hours in a telephone conversation with Harger's civil defense counsel.
A compromise and settlement is, in effect, a contract to end judicial proceedings. H.W. Houston Constr. Co. v. District Court, 632 P.2d 563 (Colo. 1981); Goltl v. Cummings, 152 Colo. 57, 380 P.2d 556 (1963). As we said in Houston, supra, "In order for a settlement to be binding and enforceable, there must be a `meeting of the minds' as to the terms and conditions of the compromise and settlement." H.W. Houston Constr. Co. v. District Court, 632 P.2d at 565.
In addition, as we have stated on numerous occasions, an attorney does not have the authority to compromise and settle the claim of his client without the knowledge or consent of his client. Radosevich v. Pegues, 133 Colo. 148, 292 P.2d 741 (1956); Lewis v. Vache, 92 Colo. 358, 20 P.2d 554 (1933) (an attorney may not compromise his client's cause without express authority); Hallack v. Loft, 19 Colo. 74, 34 P. 568 (1893); Coon v. Ginsberg, 32 Colo. App. 206, 509 P.2d 1293 (1973). See also Annot., 66 A.L.R. 107 (1930); annot., 30 A.L.R.2d 944 (1953); 7A C.J.S., Attorney and Client § 214 (1980).
It is also well established that an attorney who is clothed with no other authority than that arising from his employment as attorney has no implied authority by virtue of his general retainer to compromise and settle a claim of his client. Annot., 3 A.L.R.2d 944 at § 2; 7 Am.Jur.2d Attorneys at Law § 156 (1980).
Our examination of the record establishes that there was no precedent special authority running from the petitioner to Lampert to settle or compromise his civil action. Also absent is any evidence of ratification by petitioner. Thus, the prerequisites for settlement are not found in the factual circumstances of the case.
While we do not treat the statements of counsel and the resulting order lightly, in the circumstances before us there are other considerations which we find controlling. In our view, it would be inequitable to enforce an agreement for compromise and settlement which was a mistake on the part of Lampert, and relief can and should be granted in order to prevent manifest injustice.
Further, no prejudice will ensue to Harger because any payments he makes to petitioner, pursuant to the order of restitution, can be credited against recovery, if any, in the civil action. Lastly, the parties will have their day in court for a determination of the controversy on the merits.
The respondent court is ordered to allow civil action 79CV25 to proceed. The rule to show cause is made absolute.
JUSTICE ERICKSON dissents.