Dog Bite Settlement Case Dealing with the Defendant’s Homeowners Insurance Policy*

This is a review of a lawsuit stemming from a purported dog bite settlement between a homeowner’s insurance company and a man who was bitten by the homeowner’s dog. During deposition, the attorneys for both sides came to an agreement on a settlement to cover both the victim's damages and his suffering.

The victim, displeased with the settlement, dismissed his attorney and hired new counsel. Meanwhile, the attorney for the homeowner believed they had a legally binding agreement with the victim's first attorney, and they asked the court to enforce that agreement. 

The victim's new counsel contested the settlement in court, along with the victim's first attorney's claim for a portion of the dog bite settlement as a fee.

Statement of Facts...

On November 5th, 2010, Mick Melville was invited to the Kort family's home to attend Mrs. Kort's 30th birthday party. Inside the house was the Korts' three-year-old Border Collie. Mr. Kort often entertained in his home and the dog was usually around when guests were present. 

The Collie was known to be passive and rarely displayed any aggressive tendencies. In the three years the Korts owned the dog, it never bit a human being.

During the birthday party, Melville began to play with the Collie. He attempted to have the Collie respond to his commands of “sit” and “rollover”. After several minutes of trying, Melville could not get the dog to follow his directions.

Testimony at trial from several witnesses stated that Melville appeared to become angry with the dog and hit the Collie on its snout. 

After being hit four or five times, the Collie snapped at Melville, biting his right hand and right forearm. The bite pierced Melville’s skin and was deep enough so bone could be seen through the blood.

Melville’s wife drove him to the Santa Clara Hospital’s emergency room. There he was treated and received a total of 22 stitches to his right hand and forearm. He was released the same day and told to see his own doctor.

Melville was a forklift operator in the Monsani Corporation’s warehouse in Santa Clara. He was also right-handed. As a result of the injury, he was unable to operate the forklift safely. He was resigned to convalescing at home for several weeks. As he was an hourly employee, he was not paid during the time he was unable to work.

Melville’s combined medical bills amounted to $12,000. His out of pocket expenses for prescription medication and over the counter aids was $265. His lost wages amounted to $3200. Melville retained a personal injury attorney and filed suit against Kort.

The Lawsuit...

After he was informed of Melville's intentions, Mr. Kort notified his homeowner’s insurance company. His insurance company, in turn, provided an attorney to defend him. 

At a point during one of the depositions, attorneys for both sides came to an oral agreement for a dog bite settlement in the amount of $15,465 for Melville’s actual costs (“Damages”), and an additional amount of $5,000 for Melville's “Pain and Suffering”. 

There was a Court reporter present in the room, and she took down the oral agreement. The next day Melville’s attorney sent the insurance company’s attorney a letter confirming the agreement.

Melville’s attorney entered into the dog bite settlement agreement without consulting Melville. Subsequently Melville, angered over his attorney’s agreement to settle without his authorization, refused to go through with the settlement. 

Kort’s homeowner’s insurance attorney sent a stern letter to Melville’s attorney demanding he follow through with the settlement agreement. Kort’s attorney told Melville's attorney if his client refused to sign the dog bite settlement agreement they would file a Motion to Enforce the agreement.

Melville did nothing. As a result Kort’s attorney filed a Motion to Enforce the settlement agreement. In his Motion he asked the judge to compel Melville to execute the dog bite settlement agreement so the lawsuit could be dismissed.

By this time Melville had dismissed his attorney. Melville retained new counsel to continue his representation in the lawsuit. 

Melville’s original attorney refused to release Melville from his contract to pay 40% of the dog bite settlement amount. For that, Melville’s new attorney filed a Motion for a Declaratory Judgment within the same lawsuit.

At this point, Melville and his new attorney were involved in two separate legal issues, the Motion to Enforce by the Kort's attorney and the Motion for a Declaratory Judgment by Melville's new attorney against his old attorney. The two commenced as follows:

Motion to Enforce:

California’s Code of Civil Procedure, Section 664.6 generally states if a settlement is reached between both parties in a personal injury case, and both parties signed the agreement, then the failure of either side to comply with the agreement can be enforced by the Court through the use of a Motion to Enforce the agreement.

Kort’s attorney began the hearing by entering into evidence the Court reporters’ transcribed notes confirming the agreement between the attorneys to settle the case for a total of $20,465. 

Next, Kort’s attorney entered into evidence the letter Melville’s attorney sent to him the day after the deposition. The letter read in part, “This letter will confirm our agreement to settle my client's Mick Melville’s case for the total amount of $20,465."

Korts' attorney rested.

Motion for Declaratory Judgment:

Melville’s new attorney filed a Motion for Declaratory Judgment asking the Court to nullify the contract between Melville and his original attorney. 

The new attorney subpoenaed Melville’s original attorney to testify. During his direct examination Melville’s new attorney asked the original attorney if, before agreeing to settle the case he discussed the amount with Melville. The attorney stated he did not specifically discuss the amounts of the dog bite settlement. 

The new attorney then asked him to look at the contract signed between him and Melville. He asked the attorney if he could find anywhere in it a clause indicating the attorney could settle the case without Melville’s express authorization. The attorney responded there was no such clause.

Melville’s new attorney rested.

Outcome...

Regarding the Motion to Enforce, the Court ruled as follows:

"The question before us is whether the oral dog bite settlement agreement entered into between Kort’s attorney and Melville’s is sufficient to bind both sides to the settlement agreement. 

We refer to California’s Code of Civil Procedure, Section 664.6. California common law has traditionally held that to be a binding agreement both sides must come to an agreement, and that agreement should be a full and complete ‘meeting of the minds’. 

The case law surrounding the interpretation of Section 664.6 has consistently held that an out of Court settlement in a personal injury case must be in the form of a written agreement executed by all parties to the lawsuit. Alternatively, an oral agreement to settle a case is fully enforceable, but only if the oral agreement was made in Court, on the record in the presence of the presiding judge.” 

We find although Melville’s original attorney fully represented he was entering into the settlement agreement with the consent of his client, he did in fact not have the consent of his client to do so. Therefore the Court denies Kort’s Motion to Enforce."

Regarding the Motion for Declaratory Judgment, the Court ruled:

"The Defendant filed a Motion for a Declaratory Judgment asking this Court to nullify the contingency fee agreement executed between Melville and his original attorney. The evidence presented would seem to clearly indicate Melville‘s attorney failed to fully comply with the terms of the employment contract. 

The contingency fee contract did not authorize Melville’s attorney to enter into a settlement agreement without Melville’s express authorization. As a result, we cannot say the attorney was required to obtain Melville’s express written authorization to settle, or whether his duties as Melville’s legal representative afforded the attorney an implied right to settle on Melville’s behalf. 

The interpretation of the contract between Melville and his original attorney is a separate civil matter best approached as a “Breach of Contract” case. Therefore the Court denies Melville’s Motion for a Declaratory Judgment.

The case, being not settled, shall be set for jury trial on January 10th, 2011."