KIRK GROSS CO. AND UNITED FIRE GROUP, Plaintiff-Appellees, vs. TERRY SCHWAB, Defendant-Appellant.
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IN THE COURT OF APPEALS OF IOWA
No. 6-673 / 05-1355
Filed November 30, 2006
KIRK GROSS CO. AND
UNITED FIRE GROUP,
Plaintiff-Appellees,
vs.
TERRY SCHWAB,
Defendant-Appellant.
________________________________________________________________
Appeal from the Iowa District Court for Mahaska County, Dan F. Morrison,
Judge.
The defendant appeals from the district court’s order granting the petition
for specific performance of a settlement agreement. AFFRIMED.
Thomas J. Reilly of Thomas J. Reilly Law Firm, P.C., Des Moines, for
appellant.
Chris Scheldrup and Charles A. Blades of Scheldrup Law Firm, P.C.,
Cedar Rapids, for appellees.
Considered by Vogel, P.J., and Miller and Eisenhauer, JJ.
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VOGEL, P.J.
Terry Schwab appeals from the district court’s order that granted the
petition in equity to enforce specific performance of a settlement agreement
between the parties. We affirm.
I. Background Facts and Proceedings.
Schwab was employed by Kirk Gross Co. in December 2000, when he
alleges he suffered a work-related injury to his back on his second day of work.
Schwab subsequently hired attorney Jason Neifert to represent him before the
Iowa Workers’ Compensation Commission.
In February 2002, Neifert filed a
petition for arbitration before the Commission. The record reflects that there
were serious issues with Schwab’s ability to prove he suffered a work-related
injury as alleged, due to Schwab’s history of back injury and an unfavorable
independent medical examination. Neifert fully admits that he initiated settlement
discussions beginning in December 2002 with Chris Scheldrup, the attorney
representing Kirk Gross Co. and United Fire Group (the plaintiffs), without first
obtaining Schwab’s permission to do so. However, Neifert testified at hearing
and in deposition that as negotiations continued, he always conveyed any
settlement offers back to Schwab.
Neifert’s correspondence in the record is
consistent with his testimony on taking offers to Schwab. On February 11, 2004,
the day they were to appear before the Commission, Neifert met with Schwab
and a friend for approximately three hours, as negotiations continued.
Eventually, Scheldrup offered to settle the claim for $6500. Neifert testified that
he told Schwab it was a favorable settlement offer in light of their proof problems
going into the hearing.
Before accepting, Schwab went outside to smoke a
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cigarette but then returned and expressly accepted the offer and authorized
Neifert to convey the acceptance to Scheldrup. Neifert did so, and the parties
then agreed that Scheldrup would draw up the settlement agreement for the
parties to sign. Schwab claims that he never authorized Neifert to accept the
$6500 offer, and that Neifert had accepted the offer before Schwab arrived at
Neifert’s office.
On February 12, 2004, the day after the $6500 settlement agreement was
reached, Schwab wrote a letter to Neifert and one to the Commissioner
expressing his dissatisfaction with Neifert’s level of representation. In the letter
to the Commissioner he stated, “We had discussed a settlement offer but the
more [I] have to think about it this is not right.”
Schwab refused sign the
settlement agreement and terminated Neifert’s representation.
Neifert gave
Schwab at least two complete copies of his file between June 2004 and
December 2004, cautioning him to obtain a new attorney to protect his interests
on his claim before the Commissioner and to defend the action by the plaintiffs
for specific performance of the settlement agreement.
Neifert also informed
Schwab that he could contact another attorney to discuss a potential malpractice
action or pursue an ethics complaint against Neifert.
Schwab did not retain
another attorney. The plaintiffs filed their action for specific performance of the
settlement agreement in district court in October 2004. Schwab answered the
petition, proceeding pro se, and denied that he agreed to settle his workers’
compensation claim. Schwab appeared for the trial setting conference in March
2005, which set the date of trial for July 6, 2005. In May 2005, the plaintiffs filed
discovery motions, including a motion to compel Neifert’s deposition and
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documents related to his representation of Schwab. Neifert gave his deposition
with accompanying documents and the motion to compel was voluntarily
withdrawn by the plaintiffs on June 6, one month prior to trial. As with all filings
throughout the pendency of the case, notice of the withdrawal of the motion to
compel was sent to Schwab.
On the date of the trial, Schwab did not appear. The plaintiffs presented
their evidence pertaining to the workers’ compensation case, the settlement
negotiations, and the final agreement. Neifert testified that Schwab gave him
express permission to settle his claim for $6500. With Schwab’s failure to appear
and present evidence to the contrary, the district court found the settlement
agreement valid and ruled in the plaintiffs’ favor by ordering specific performance
of the agreement and compelling Schwab to sign the necessary documents.
Schwab filed a motion to reconsider, stating among other things, “The court
needs to hear the things which I have had to deal with from these attorneys.”
The district court denied the motion, and Schwab appeals.
II. Scope of Review.1
Kirk Gross Co. and United Fire Group requested the court order Schwab
to sign the settlement agreement and to fulfill the obligations according to the
terms of the agreement.
Specific performance is a form of equitable relief.
Passehl Estate v. Passehl, 712 N.W.2d 408, 414 (Iowa 2006). Because this
matter was tried by the district court wholly in equity, we review this appeal de
1
Schwab submits that the scope of review on his appeal is for correction of errors at
law. However, Schwab misstates the nature of the case on appeal, as the proceedings
at district court were not a judicial review of an agency action, but a separate equitable
action to enforce the settlement agreement.
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novo. Iowa R. App. P. 6.4
III. Enforcement of the Settlement Agreement.
Schwab argues on appeal that his claims have been properly preserved
and that there are material issues of fact concerning whether Schwab gave
Neifert authority to accept the settlement agreement.
We first note that the
petition for specific performance of the settlement agreement was not before the
district court on a motion for summary judgment, but for a hearing on the merits.
Therefore, the question is not whether there are material issues of fact in dispute,
but whether the evidence presented at hearing supports the district court’s ruling.
To this extent, Schwab refers to evidence which was apparently not before the
district court at hearing due to his failure to appear and present evidence on his
behalf. We may only consider the evidence presented at trial as to whether the
record supports the district court ruling. See Iowa R. App. P. 6.10.
Agreements for special case settlements are not binding unless approved
by the workers’ compensation commissioner pursuant to Iowa Code section
85.35.
City of Ottumwa v. Poole, 687 N.W.2d 266, 269 (Iowa 2004).
If an
agreement has been reached for the submission of a special case settlement to
the commission, it may be specifically enforced to the extent of ordering a party
to sign the documents necessary for that purpose. Dillon v. City of Davenport,
366 N.W.2d 918, 925-26 (Iowa 1985). In such specific enforcement actions, the
court does not act to influence the decision of the commissioner under section
85.35. Poole, 687 N.W.2d at 269.
Schwab’s main contention on appeal is that Neifert did not have authority
to settle his workers’ compensation claim for $6500. The making of a settlement
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offer is an act generally within the scope of authority of an attorney handling
personal injury litigation for a client.
Strong v. Rothamel, 523 N.W.2d 597,
600 (Iowa Ct. App. 1994). However, an attorney cannot settle or compromise a
claim of his or her client without special authority. Id. Although an attorney is
presumed to act with authority, the presumption is not conclusive and may be
rebutted.
Gilbride v. Trunnelle, 620 N.W.2d 244, 251 (Iowa 2000).
The
presumption is overcome only by clear and satisfactory proof. Id. (citing Lonning
v. Lonning, 199 N.W.2d 60, 62 (Iowa 1972)).
The only proof submitted at trial supports Neifert’s position and the district
court’s conclusion that Schwab consented to the $6500 settlement agreement
and gave Neifert permission to accept the offer. Because he was acting pro se
before the district court, Schwab claims he misinterpreted the dismissal of the
motion to compel as a complete dismissal of the case against him and that was
why he failed to appear for trial. It has long been the rule that procedural rules
apply not only to parties who are represented by counsel but also those who are
not. Pro se parties receive no deferential treatment. See Hays v. Hays, 612
N.W.2d 817, 819 (Iowa Ct. App. 2000).
The law does not judge by two
standards, one for lawyers and another for lay persons. Kubik v. Burk, 540
N.W.2d 60, 63 (Iowa App. 1995). Rather, all are expected to act with equal
competence. Id. If lay persons choose to proceed pro se, they do so at their
own risk. Id. With his failure to appear for trial and submit any contrary evidence
whatsoever, Schwab failed to rebut the presumption and the evidence offered
that Neifert was acting with his authority when he accepted the offer to settle.
We therefore affirm the district court’s order for specific performance compelling
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Schwab to sign the settlement agreement and govern himself accordingly.
AFFIRMED.
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