e-Mail Signature Ruled Valid To Enforce Settlement

Signing an e-mail attesting to the substance of a negotiated agreement with the typed name of the sender constitutes a binding and enforceable stipulation of the settlement under CPLR 2104, a New York state appeals panel ruled on July 26. See, Forcelli v. Gelco Corp.,' 27584/08, NYLJ 1202612381868, at *1 (App. Div., 2nd, Decided July 24, 2013).

An Appellate Division, Second Department, panel held unanimously that an agent for a vehicle insurer, by entering her name to the message summing up the terms of a settlement in an auto accident case, provided the “subscription” to the written statement required for an enforceable stipulation under CPLR 2104.

The statute says “an agreement between parties or their attorneys relating to any matter in an action ' is not binding upon a party unless it is in a writing subscribed by him or his attorney.” It adds that the agreement must be “signed” by the party or the attorney.

Justice Sandra Sgroi, writing for the panel, said that typing the sender's name at the end of an e-mail accomplishes the same purpose of validating the stipulation that signing a paper document by hand does under CPLR 2104.

“Given the widespread use of e-mail as a form of written communication in both personal and business affairs, it would be unreasonable to conclude that e-mail messages are incapable of conforming to the criteria of CPLR 2104 simply because they cannot be physically signed in a traditional fashion,” Sgroi wrote.

She cautioned that the contents of an e-mail that is subscribed to without a traditional handwritten signature must accurately relate the terms of the negotiated settlement in order to be binding and enforceable.

She said the panel's ruling is in line with those in New York's First and Third departments.

In Williamson v. Delsener, 59 AD3d (2009), the First Department held that “e-mails exchanged between counsel, which contained their printed names at the end, constitute signed writings (CPLR 2104) within the meaning of the statute of frauds.”

In Brighton Inv. v. HarZvi, 88 AD3d 1220 (2011), a Third Department panel stated that “an exchange of e-mails may constitute an enforceable contract, even if a party subsequently fails to sign implementing documents, when the communications are sufficiently clear and concrete to establish such an intent.”

The dispute in Forcelli centered on the enforceability of an e-mail sent on May 3, 2011, that summed up an apparent agreement reached to settle a claim stemming from a November 2008 auto accident on the Saw Mill River Parkway in Westchester County.

Plaintiff John Forcelli sued for injuries he suffered when his car was hit by a southbound vehicle that entered his northbound lane. That vehicle, in turn, had been hit and knocked off path by a third vehicle that drove through a red light.

The second car, which collided with Forcelli's vehicle, was owned by the Gelco Corporation and leased to Xerox Corporation, the employer of the driver, Mitchell Maller.

After settlement discussions, Brenda Greene, a claims adjustor with Sedgwick CMS, the insurer of the Gelco defendants' vehicle, offered $230,000 to settle the case and Forcelli's counsel orally accepted the offer, according to the decision ruling.

Greene's e-mail to Forcelli's counsel, with a copy to Xerox representatives, said: “Per our phone conversation today, May 3, 2011, you accept my offer of $230,000 to settle this case. Please have your client executed [sic] the attached Medicare form as no settlement check can be issued without this form. You also agreed to prepare the release, please included [sic] the following names: Xerox Corporation, Gelco Corporation, Mitchell G. Maller and Sedgwick CMS. Please forward the release and dismissal for my review. Thanks Brenda Greene.”

Forcelli signed the release, notarized by his counsel, the next day releasing Gelco, Xerox and Sedgwick CMS from all actions involving the accident and accepting the $230,000 settlement offer. Certified mail documents indicate that Segwick CMS received the documents by mail on May 16, 2011.

On May 10, Supreme Court Justice Gerald Loehr in Westchester County issued an order granting a motion by the Gelco defendants for summary judgment dismissing the complaint against them and all cross motions on the issue of liability.

On May 12, Gelco counsel John Hsu faxed a letter to Forcelli's counsel advising that the discontinuance signed by Forcelli is “hereby rejected” and that “there was no settlement consummated under New York CPLR 2104 between the parties” because “we considered this matter dismissed by the court's decision ' dated May 10, 2011.”

On July 20, 2011, Loehr accepted Forcelli's motion to vacate so much of the judge's May 10 order dismissing the complaint and enforced the settlement order for $230,000 embodied in the May 3 e-mail from Greene.

Additional weight was added to the argument in favor of the enforceability of the e-mail agreement when Greene added: “Thanks Brenda Greene” at the end of the transmission, the Second Department said.

“This indicates that the author purposefully added her name to this particular e-mail message, rather than a situation where the sender's e-mail software has been programmed to automatically generate the name of the e-mail sender, along with other identifying information, every time an e-mail message is sent,” Sgroi wrote.

The court added: “In addition, the circumstances which preceded Greene's e-mail message, and in particular, the face-to-face mediation at which settlement was attempted and the subsequent follow-up telephone calls between Greene and the plaintiff's counsel, support the conclusion that Greene intended to 'subscribe' the e-mail settlement for purposes of CPLR 2104.”

Patrick Lawless and Richard Lerner of Wilson Elser Moskowitz Edelman & Dicker in Manhattan represented Gelco and the other appellants.

Jonathan Rice of Grant & Longworth in Dobbs Ferry argued for Forcelli and his wife, who sued derivatively for injuries suffered by Forcelli.

“This confirms what all reasonable minds would have expected, that mutually agreed to settlements where confirmed via e-mail or fax and followed up by transmittal of settlement documents constitutes a binding settlement,” said Rice.

Joel Stashenko is the Albany Bureau Chief of the New York Law Journal, an ALM affiliate of e-Commerce Law & Strategy. He can be contacted at [email protected].

Signing an e-mail attesting to the substance of a negotiated agreement with the typed name of the sender constitutes a binding and enforceable stipulation of the settlement under CPLR 2104, a New York state appeals panel ruled on July 26. See, Forcelli v. Gelco Corp.,' 27584/08, NYLJ 1202612381868, at *1 (App. Div., 2nd, Decided July 24, 2013).

An Appellate Division, Second Department, panel held unanimously that an agent for a vehicle insurer, by entering her name to the message summing up the terms of a settlement in an auto accident case, provided the “subscription” to the written statement required for an enforceable stipulation under CPLR 2104.

The statute says “an agreement between parties or their attorneys relating to any matter in an action ' is not binding upon a party unless it is in a writing subscribed by him or his attorney.” It adds that the agreement must be “signed” by the party or the attorney.

Justice Sandra Sgroi, writing for the panel, said that typing the sender's name at the end of an e-mail accomplishes the same purpose of validating the stipulation that signing a paper document by hand does under CPLR 2104.

“Given the widespread use of e-mail as a form of written communication in both personal and business affairs, it would be unreasonable to conclude that e-mail messages are incapable of conforming to the criteria of CPLR 2104 simply because they cannot be physically signed in a traditional fashion,” Sgroi wrote.

She cautioned that the contents of an e-mail that is subscribed to without a traditional handwritten signature must accurately relate the terms of the negotiated settlement in order to be binding and enforceable.

She said the panel's ruling is in line with those in New York's First and Third departments.

In Williamson v. Delsener, 59 AD3d (2009), the First Department held that “e-mails exchanged between counsel, which contained their printed names at the end, constitute signed writings (CPLR 2104) within the meaning of the statute of frauds.”

In Brighton Inv. v. HarZvi, 88 AD3d 1220 (2011), a Third Department panel stated that “an exchange of e-mails may constitute an enforceable contract, even if a party subsequently fails to sign implementing documents, when the communications are sufficiently clear and concrete to establish such an intent.”

The dispute in Forcelli centered on the enforceability of an e-mail sent on May 3, 2011, that summed up an apparent agreement reached to settle a claim stemming from a November 2008 auto accident on the Saw Mill River Parkway in Westchester County.

Plaintiff John Forcelli sued for injuries he suffered when his car was hit by a southbound vehicle that entered his northbound lane. That vehicle, in turn, had been hit and knocked off path by a third vehicle that drove through a red light.

The second car, which collided with Forcelli's vehicle, was owned by the Gelco Corporation and leased to Xerox Corporation, the employer of the driver, Mitchell Maller.

After settlement discussions, Brenda Greene, a claims adjustor with Sedgwick CMS, the insurer of the Gelco defendants' vehicle, offered $230,000 to settle the case and Forcelli's counsel orally accepted the offer, according to the decision ruling.

Greene's e-mail to Forcelli's counsel, with a copy to Xerox representatives, said: “Per our phone conversation today, May 3, 2011, you accept my offer of $230,000 to settle this case. Please have your client executed [sic] the attached Medicare form as no settlement check can be issued without this form. You also agreed to prepare the release, please included [sic] the following names: Xerox Corporation, Gelco Corporation, Mitchell G. Maller and Sedgwick CMS. Please forward the release and dismissal for my review. Thanks Brenda Greene.”

Forcelli signed the release, notarized by his counsel, the next day releasing Gelco, Xerox and Sedgwick CMS from all actions involving the accident and accepting the $230,000 settlement offer. Certified mail documents indicate that Segwick CMS received the documents by mail on May 16, 2011.

On May 10, Supreme Court Justice Gerald Loehr in Westchester County issued an order granting a motion by the Gelco defendants for summary judgment dismissing the complaint against them and all cross motions on the issue of liability.

On May 12, Gelco counsel John Hsu faxed a letter to Forcelli's counsel advising that the discontinuance signed by Forcelli is “hereby rejected” and that “there was no settlement consummated under New York CPLR 2104 between the parties” because “we considered this matter dismissed by the court's decision ' dated May 10, 2011.”

On July 20, 2011, Loehr accepted Forcelli's motion to vacate so much of the judge's May 10 order dismissing the complaint and enforced the settlement order for $230,000 embodied in the May 3 e-mail from Greene.

Additional weight was added to the argument in favor of the enforceability of the e-mail agreement when Greene added: “Thanks Brenda Greene” at the end of the transmission, the Second Department said.

“This indicates that the author purposefully added her name to this particular e-mail message, rather than a situation where the sender's e-mail software has been programmed to automatically generate the name of the e-mail sender, along with other identifying information, every time an e-mail message is sent,” Sgroi wrote.

The court added: “In addition, the circumstances which preceded Greene's e-mail message, and in particular, the face-to-face mediation at which settlement was attempted and the subsequent follow-up telephone calls between Greene and the plaintiff's counsel, support the conclusion that Greene intended to 'subscribe' the e-mail settlement for purposes of CPLR 2104.”

Patrick Lawless and Richard Lerner of Wilson Elser Moskowitz Edelman & Dicker in Manhattan represented Gelco and the other appellants.

Jonathan Rice of Grant & Longworth in Dobbs Ferry argued for Forcelli and his wife, who sued derivatively for injuries suffered by Forcelli.

“This confirms what all reasonable minds would have expected, that mutually agreed to settlements where confirmed via e-mail or fax and followed up by transmittal of settlement documents constitutes a binding settlement,” said Rice.

Joel Stashenko is the Albany Bureau Chief of the New York Law Journal, an ALM affiliate of e-Commerce Law & Strategy. He can be contacted at [email protected].