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MAIN LINE THEATRES, INC. v. PARAMOUNT FILM DISTRIB

November 10, 1960.

Main Line Theatres, Inc.
v.
Paramount Film Distributing Corp., et al. 309 Drive-In Corp. v. Paramount Film Distributing Corp., et al.



The opinion of the court was delivered by: VAN DUSEN

The court and counsel agreed in the early stages of the settlement negotiations that each case would be considered on an individual basis so that there would be no sacrifice of the legitimate claims of some plaintiffs for others, even though defendants might not agree to settle any of such cases until after the trial of the Colonial case, unless a substantial number of these thirteen cases involving similar issues were settled. *fn2" Counsel for plaintiffs put a specific settlement proposal on each case (N.T. 20).

Counsel who entered his appearance for plaintiffs in these cases was authorized to represent plaintiffs in these cases until late August 1960. The authorized officer of the plaintiffs in the above-captioned cases stated to such counsel for plaintiffs in these cases no later than May 20, 1960, that plaintiffs were willing to settle both cases for a total of $10,000.00 *fn3" (pages 8, 10, 40 and 43 of Document No. 79 in Civil Action No. 19288 and paragraph 2 of Answer to Motions, being Document No. 19 in Civil Action No. 24983). On or before May 23, 1960, as pointed out in more detail below, defendants notified plaintiffs' counsel that the $10,000.00 for these two cases was acceptable and the customary release used in cases such as these were forwarded to plaintiffs' counsel. On May 26, this authorized officer of plaintiffs was notified of the acceptance by defendants of the $10,000.00 settlement and he stated that the first 2 1/2 lines of Section 3 of the Release (see Exhibit A to the Petition) were unacceptable. *fn4" This is the only part of the release which was objectionable (N.T. 56, 97-99). However, defendants have agreed to eliminate this language from the release (N.T. 209) and this is also the only portion of the release which is objectionable to plaintiffs' subsequent vendees (N.T. 141 & 172). *fn5"

 The Colonial case was scheduled for trial to a jury on May 16, 1960, and the trial was deferred until May 23 (selection of the jury to be, and was, completed on Friday, May 20), when it appeared that settlement of several of the thirteen cases was imminent. During the week of May 16, it became clear that three of the cases would not be settled *fn6" and the parties continued negotiations for settlement of the remaining ten cases, including the above-captioned cases. As stated at page 2 of defendants' brief:

 "Counsel for defendants made it clear to and to the Court that since each of the ten cases involved a key run problem, the defendants would not settle one case without settling all ten. The reason was that to settle one case would merely postpone the resolution of the economic problem that was raised by this group of cases."

 (a) The Colonial case (C.A. 19288) would not be tried and was settled;

 (b) all ten cases, with the possible exception of the Reo and the Dembow cases, were settled *fn7" (see page 25 of Document No. 79 in C.A. 19288); and

 (c) the defendants' counsel were willing to undertake the raising of an additional sum as counsel fee which would permit settlement of the excepted cases mentioned in (b) above with the full approval of Messrs. Wax and Dembow (pp. 16 and 26-27 of Document No. 79 in Civil Action No. 19288), even though defendants took the position that the Reo and Dembow cases had actually been settled.

 Under the above facts, it is clear that plaintiffs' counsel had the actual authority *fn8" to settle these two cases for $10,000.00 and did so settle them in May 1960 before plaintiffs had made any sale or lease of these theatres.

 The Pennsylvania appellate courts have consistently held that where a definite oral contract is made, it is effective when orally accepted and the parties will be required to execute any written documents contemplated as necessary to carry out the terms of the oral agreement. See Taylor v. Stanley Co. of America , 305 Pa. 546, 553 (1932); Ketchum v. Conneaut Lake Co. , 309 Pa. 224, 229 (1932); Mezza v. Beiletti et ux , 161 Pa. Super, 213, 220 (1947); cf. Comm. Cas. Ins. Co. v. Martin , 316 Pa. 479, 480 (1934). *fn9" This record makes clear that there was an oral agreement to settle these two cases for $5,000 each, or a total of $10,000, which was completed in May 1960. In pursuance of this contract, defendants are required to pay this sum and plaintiffs are bound to execute appropriate releases, as well as have these actions marked dismissed with prejudice. There is no evidence whatever that the parties intended a writing to be executed containing all these settlement terms and no such writing, other than the correspondence saying the cases were settled (P-3), was prepared in any of the other eight cases. *fn10" The releases used did not mention the exact consideration but the nominal $1.00 was recited. The defendants are willing to accept a release without the words considered objectionable by plaintiffs, so that there is no need to decide what is an appropriate release as contemplated by the oral settlement agreement. Plaintiffs cannot avoid such a settlement agreement on the ground that they do not like a release which defendants are willing even to execute in a form exactly as desired by plaintiffs (N.T. 97-99). *fn11" See McKenzie v. Boorhem , 117 F.Supp. 433, 435-6 (W.D. Ark, 1954), where the court said at page 436:

 "The agreement was complete and binding at that time, and the fact that the written agreement tendered to Boorhem for signing might not have conformed to the oral settlement agreement would not in any wise affect the validity of said oral agreement."

 Oral settlement agreements are valid and enforcible in Pennsylvania.Woodbridge v. Hall , 366 Pa. 46 (1950); Scranton Gas & W. Co. v. Weston , 57 Pa. Super. 355 (1914). *fn12"

 This makes it unnecessary to consider many other matters argued by counsel, such as the existence on May 23 of a settlement of all ten cases and the validity of the purported assigned (P-12) of these causes of action in late July or early August 1960 to the purchaser of the ...


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