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FARRIS v. J.C. PENNEY CO.

April 15, 1998

MARGARET FARRIS, et al., Plaintiffs,
v.
J.C. PENNEY CO., Defendant.



The opinion of the court was delivered by: BRODY

MEMORANDUM AND ORDER

 Brody, J.

 April 15, 1998

 Plaintiffs Margaret and Charles Farris, husband and wife, have filed a motion to set aside the settlement and 41.1(b) dismissal order entered in this case, asserting that they did not authorize their attorney to settle the case. After an evidentiary hearing on February 25, 1998 and briefing by the parties, I have determined that, while plaintiffs have established that this case was settled without their actual authority, they have not produced evidence sufficient to demonstrate that this case was settled without apparent authority, an alternative ground for enforcing settlements under Pennsylvania law, the applicable law in this diversity action. I therefore conclude, for reasons set forth below, that plaintiffs have not shown cause, as required by Fed.R.Civ.P. 60(b), to vacate the judgment of dismissal entered in this action. *fn1"

 A. Background

 Plaintiffs brought this personal injury action against J.C. Penney Co., for damages arising out of injuries allegedly sustained by Margaret Farris after a fall at a Penney's store in downtown Philadelphia on April 15, 1995. Plaintiffs were represented by attorney Timothy Booker ("Booker"). The case, originally assigned to Hon. John P. Fullam of this court, went to jury trial on September 25, 1996. After one full day of testimony, the parties entered into settlement negotiations on the morning of September 26, 1996. At some point on that day, the attorneys informed Judge Fullam that a settlement had been reached. The attorneys and parties were re-called to the courtroom, and the settlement was placed on the record with all parties present. An order dismissing the case pursuant to Local Rule 41.1(b) was issued on September 26, 1996.

 On October 7, 1996, Booker filed a motion to enforce the settlement, in which he asserted that the case had been settled, that the settlement was placed on the record with plaintiffs present, and that plaintiffs now refused to sign the release. *fn2" Booker also requested, as part of his motion, that the proceeds of the settlement be deposited in an escrow account with the court. On January 13, 1997, a hearing was held on the motion to enforce the settlement. During the hearing, Judge Fullam indicated that he might be needed to testify in this matter, and recused himself. The case was then reassigned to me.

 On January 22, 1997, attorney Richard Abraham ("Abraham") entered his appearance on behalf of plaintiffs. *fn3" On January 24, 1997, Abraham, on behalf of plaintiffs, filed a motion, under Fed.R.Civ.P. 60(b), for relief from dismissal, asserting that the case had been settled without their consent or authorization. *fn4" After protracted, and ultimately successful, efforts by Abraham to take Booker's deposition and examine his file for this case, an evidentiary hearing on the motion for relief from dismissal (i.e., to set aside the settlement) was held on February 25, 1998. The following constitute my findings of fact and conclusions of law with regard to this motion.

 B. Findings of Fact

 1. Plaintiffs Margaret and Charles Farris entered into a contingent fee agreement with Timothy Booker, Esquire, in which Booker agreed to represent the Farrises in their personal injury action against J.C. Penney Co. arising out of the incident on April 15, 1995, and they agreed to pay him 40% of the gross fund recovered through suit or settlement.

 2. The contingent fee agreement purported to authorize Booker to "bring suit or to settle and compromise the said claim as he sees fit and on his own without further discussions with" the Farrises, although such language is most likely insufficient, under Pennsylvania law, to authorize an attorney to enter into a settlement agreement on the client's behalf. *fn5"

 3. On September 5, 1996, plaintiffs requested that the trial of this matter be continued because Mrs. Farris was still receiving medical treatment. The request for a continuance was denied and the trial began on September 25, 1996.

 4. Judge Fullam bifurcated the trial, with liability to be determined first, and then damages. The record does not reveal whether the damages portion of the trial, if necessary, was to be immediately after the damages portion or at some later date.

 5. Booker had not made arrangements to have any experts testify, in person or via videotape, in the event that the ...


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