Settlement Agreements in Georgia Car Accidents

When you are injured and anxious about paying medical expenses after a serious car accident, you may be tempted to sign a settlement agreement with an insurer for a small sum of money. It is common for a negligent or reckless driver’s insurer to work with defense attorneys who recommend quick settlements to avoid lawsuits.
You should be aware that injuries can worsen as time passes and it’s important to consult with an attorney about your options. It is also a good idea to consult an attorney before making any offer to settle with an insurer as an insurer may try to take advantage of you.
In a recent case, a woman appealed in connection with a settlement agreement. The case arose from the woman’s motorcycle accident in 2012. She was struck by the defendant’s car while riding her motorcycle and suffered serious injuries. She received emergency medical care at Atlantic Medical Center. The defendant driver was charged with various traffic violations including a DUI and reckless driving.
The defendant was insured by Equity Insurance Coverage, which had a per person limit of $25,000. The woman’s insurer notified Equity of the loss and the claim was assigned to a third-party claims administrator.
While the woman was being treated for injuries, she sent a demand letter to the third-party claims administrator, which requested “all the insurance money” that the defendant had under his insurance policy. She stated she would sign a limited release in exchange, so long as the release did not have language stating she would have to pay the insurer or defendant any of their incurred costs. It also set a deadline of 21 days and a form of payment.
The third-party claims administrator sent the woman a letter agreeing to settle her claims for the limits of the defendant’s liability insurance.  A letter to the attached limited release form stated that she had to put money in an escrow account with respect to any liens pending. There was indemnification language in the release, requiring the plaintiff to indemnify the insurer and defendant if anybody made a claim for incurred costs.
Soon after, the woman retained an attorney and told the third-party claims administrator that she considered their letter a counteroffer rather than an acceptance. She rejected the counteroffer and sued the defendant.
The defendant asked the court to enforce the settlement agreement. The trial court agreed. The plaintiff appealed, arguing that the third-party claim administrator’s settlement demand did not meet the terms of her offer precisely. She argued also that the administrator’s demand she place funds into an escrow account worked as a counteroffer.
The appellate court explained that when looking at whether an alleged settlement agreement is enforceable, a trial court is limited to enforcing terms to which the parties mutually agreed. Unless the parties have mutually agreed upon terms, there is no enforceable contract. The appellate court reasoned that because an offer must be accepted without any variance, the administrator’s letter adding and altering the plaintiff’s terms constituted a counteroffer.
In the letter, the administrator did not simply ask about the existence of liens, but made an affirmative demand that the plaintiff put settlement funds into escrow. By using the term “demand” the administrator was expressing a condition that the plaintiff had to satisfy in order for the administrator’s letter to be considered an acceptance. The motion to enforce the settlement was reversed.
If you are seriously injured in a car accident, you may have grounds for a lawsuit. Experienced Atlanta personal injury attorney Terrence R. Bethune can evaluate your case and fight for any compensation you may deserve. Contact us at 404-875-7800 or via our online form.