A question that sometimes arises is whether an attorney can agree to a settlement on behalf of their client. In an unreported (non-precedential) Appellate Division opinion released on April 13, 2010 in the case of Sweeney v. Sweeney, the court answered that question with a resounding maybe.
In this case, the wife alleged that on the night before trial, the parties’ attorneys had "intense" settlement negotiations that lead to a resolution of all issues except for a section of the agreement entitled "General Mutual Releases." On the following day, the husband appeared without his lawyer and disputed that there was a settlement. The divorce was put through on that day but not the settlement. Rather, the wife filed a motion for enforcement of the agreement reached between counsel. Despite the fact that there were conflicting certifications, her motion was granted.
The Appellate Division reversed the matter for a plenary hearing to determine whether the husband actually vested his attorney with the authority to bind him to a settlement. Citing the general from the reported decision of Amatuzzo v. Kozmiuk, governing the scope of an attorney’s authority to bind his or
her client to a settlement agreement, the Appellate Division noted:
The general rule is that unless an attorney is specifically authorized by the client to settle a case, the consent of the client is necessary. Negotiations of an attorney are not binding on the client unless the client has expressly authorized the settlement or the client’s voluntary act has placed the attorney in a situation wherein a person of ordinary prudence would be justified in presuming that the attorney had authority to enter into a settlement, not just negotiations, on behalf of the client. Thus, in private litigation, where the client by words or conduct communicated to the adverse attorney, engenders a reasonable
belief that the attorney possesses authority to conclude a settlement, the settlement may be enforced. However, the attorney’s words or acts alone are insufficient to cloak the attorney with apparent authority.
So just because you think your case is settled does not mean it is really settled.