Appellate Court finds no settlement contract due to carrier’s conditional settlement offer and failure to finalize performance within a reasonable timeframe.

The Third District Court of Appeals reversed the trial court’s order granting the homeowners’ motion to enforce a pre-suit settlement agreement and remanded for further proceeding. 

On October 1, 2021, following its investigation of Lorenzo’s property damage claim, Homeowners Choice extended a pre-suit settlement offer, contingent upon management approval, to Lorenzo to resolve the claim. On October 4, 2021, Lorenzo confirmed her intent to accept the offer to settle the claim and requested the settlement release. However, Homeowners did not inform Lorenzo of management’s approval of the offer or provide the requested settlement release until March 28, 2022. By that time, the damage at Lorenzo’s property worsened, and she had filed a notice of intent to litigation, seeking a higher amount than Homeowners’ prior settlement offer. A lawsuit was subsequently initiated, and Homeowners filed a motion to enforce a pre-suit settlement agreement. 

The trial granted Homeowners’ motion to enforce the pre-suit settlement agreement. Lorenzo appealed, arguing the trial court erred in granting the motion as the parties did not mutually assent to the settlement agreement.

Under de novo review, the issue before the Third District was whether the trial court was correct in finding there was a valid, binding settlement contract. In agreeing with Lorenzo, the Third District found Homeowners’ proposed settlement amount was merely a solicitation pending management approval rather than a formal settlement offer. Further, the Lorenzo court held, upon Lorenzo’s confirmation of intent to accept the offer, Homeowners’ near seven-month delay in providing the release outlining all essential terms of the settlement was not performed within a reasonable timeframe, as required by law governing contractual performance. Thus, the Third District found that no settlement contract existed. 

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