Did You Settle That Lawsuit? Are You Sure?
A “CR 2A agreement” refers to Washington Superior Court Civil Rule 2A (SEE HERE). This rule means courts will enforce a settlement when it meets certain criteria, even when the lawyers have not yet drafted a complete and detailed settlement agreement.
Lawyers in Washington state must exercise great care when they discuss settlement in writing. CR 2A agreements bind parties once key markers are present, and a simple email exchange can create an enforceable deal. Lawyers also must take caution not to enter such agreements by accident, because courts will uphold them if the terms appear clear and intentional.
In a case decided by the Washington Court of Appeals last week, the court enforced a settlement between Omni Staffing Services, Inc., and healthcare facilities owned by Caldera Partners Limited Partnership. Omni provides temporary staff to health care providers. Caldera owed Omni about $291,000 for unpaid invoices. Caldera sent a $50,000 partial payment, and Omni sued for the full amount.
The parties negotiated. Owners texted about a $266,000 balance, but ambiguity existed over the $50,000 credit. Lawyers then negotiated. Omni offered $220,000 over 90 days, noting that invoices excluded the $50,000 wire. Caldera countered with $215,000 over 90 days, stating that acceptance would mean an agreement. Omni agreed. Caldera’s lawyer drafted a document for $215,000 in three installments, with no credit mentioned. He called it acceptable to all. Omni signed.
Caldera later claimed a mistake, assuming a $50,000 credit, and wanted to pay $165,000. Omni sought enforcement. The trial court sided with Omni. On appeal, Caldera argued the existence of missing terms and no intent to bind.
The Court of Appeals enforced the agreement because email exchanges met CR 2A requirements to form a settlement. All material terms appeared, including amount and schedule; no credit was specified. Intent showed through outward actions, like drafting the deal terms. Mistake defenses came too late.
This case shows that Civil Rule 2A may promote resolutions, but it also holds parties to their written words. Lawyers must be careful in drafting letters and emails, as even casual writings can lock in a deal. They also must avoid such agreements absent full clarity of the major terms, or they risk courts enforcing terms their clients regret and/or do not intend.
In a lawsuit, a skilled litigator makes all the difference. If you are facing a legal dispute, please feel free to contact a Beresford Booth litigator at info@beresfordlaw.com or by phone at (425) 776-4100.