Email confirmation of oral settlement suffices as signature, says court

July 26, 2013 By Charisma L. Miller, Esq. Brooklyn Daily Eagle

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The Appellate Division, 2nd Department, has ruled that a closing salutation in an email suffices as an signature valid enough to enforce an agreement.

In 2008, John T. Forcelli was injured in a 3-car crash in Westchester County. The other cars involved included a car owned by the Gelco Corporation and leased to the Xerox Corporation, and another driven by Steve Kuhn and owned by his wife Susan Landon.

Forcelli filed a suit against the other drivers to recover damages he sustained as a result of the car accident. The defendants filed a motion in Westchester Supreme Court to have the claims against them dismissed. While awaiting a decision regarding dismissal, Forcelli was able to negotiate a settlement in the amount of $230,000, which his attorney orally accepted on his behalf.

Subsequent to the oral acceptance of the settlement, the insurer sent Forcelli’s attorney a confirmation email stating, “Per our phone conversation today, May 3, 2011, you accepted 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.”

On May 10, 2011, after the emailed confirmation of settlement was sent to Forcelli, Westchester Supreme Court Justice Gerald Loehr issued an order dismissing the claims against the defendants. Forcelli requested and was granted an order to vacate the order for dismissal due to the fact that a settlement had been agreed upon prior to the issuance of the dismissal order, as evidenced by Greene’s May 3 email.

The defendants challenged the vacate order, asserting that neither the defendants nor their agents he signed the settlement agreement. The Appellate Division, Second Department, disagreed.

Under New York rules, “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 [or signed] by him or his attorney.” The defendants argued that although their insurer confirmed the existence of a settlement agreement in the May 3 email, the agreement was not signed and therefore was not subscribed to as required by applicable law.

Appellate Justice Sandra Sgroi, writing for the court, agreed that Greene’s May 3 email did not contain an electronic signature as prescribed by the Electronic Signatures and Records Act, which defines an electronic signature as an electronic sound, symbol or process attached to an electronic record and adopted by a person as their signature.

While Greene’s email did not contain any such electronic signature, “nevertheless, the record supports the conclusion that Greene, in effect, signed the email message,” Sgroi wrote.

Sgroi continued, “In particular, we note that the subject email message ended with the simple expression, `Thanks Brenda Greene,’ which appears at the end of the email text. This indicates that the author purposefully added her name to this particular email message.”

Therefore the court concluded “that Greene intended to `subscribe’ the email settlement.” As a result of the Appellate Division’s ruling, an order requiring the settlement agreement was deemed properly entered, and the defendants are required to pay Forcelli the $230,000 settlement amount.