Background
The Furshmans hired a general contractor to perform construction on their Key Largo property, who in turn retained Adonel Concrete Corp. as a subcontractor. When the Furshmans became dissatisfied with Adonel Concrete’s work and refused payment, Adonel Concrete recorded a construction lien for $16,937.26. Rather than proceed to litigation immediately, the parties engaged in settlement negotiations through a series of telephone calls and emails over a two-week period.
In a final confirmation email, Adonel Concrete restated the terms discussed in prior conversations: the Furshmans would pay $16,937.26 plus $4,500 in attorneys’ fees. Adonel Concrete stated it would “prepare and record the . . . lien release” and “prepare a mutual general release,” and requested that the Furshmans immediately contact it by email if the email did not correctly reflect their agreement. The Furshmans never objected to this email. Instead, they sent a check for the full agreed amount with a notation “For Driveway Final Payment,” and later requested the proposed lien release and general release documents for review, stating “ok, thanks, will have to you tomorrow” when sent the draft settlement and mutual release.
Adonel Concrete deposited the check and signed the mutual general release. However, the Furshmans refused to sign it, subsequently claiming the lien had been paid in full and that they owed no attorneys’ fees. When Adonel Concrete filed suit to enforce the settlement, the Furshmans counterclaimed. The trial court denied Adonel Concrete’s motion to enforce the settlement and entered final summary judgment against it.
The Court’s Holding
The Third District Court of Appeal reversed, holding that a valid and enforceable settlement agreement existed between the parties. The court applied contract formation principles, requiring an objective manifestation of assent by both parties to the essential terms. The court found such assent here despite the unsigned mutual general release.
The court identified multiple objective indications of the Furshmans’ assent: (1) they did not object to or contest Adonel Concrete’s confirmation email outlining the settlement terms; (2) they sent a check for the negotiated amount; and (3) they replied affirmatively (“ok, thanks, will have to you tomorrow”) when sent the proposed settlement and release documents. The court emphasized that contract formation depends on objective external signs—what the parties said and did—not on their subjective states of mind.
Critically, the court rejected the Furshmans’ argument that the unsigned release proved no settlement was reached. The court held that execution of the release was not a condition precedent to the settlement agreement but merely a procedural formality and memoralization of the parties’ prior agreement. Since the parties agreed on all essential terms—the payment amount, the attorneys’ fees, and the lien release—a binding contract formed regardless of whether the formal release document was ever executed.
Key Takeaways
- Settlement agreements are governed by contract law and require objective manifestation of assent to essential terms, not subjective agreement on every detail.
- Failure to execute formal settlement documents does not prevent contract formation if the parties have objectively manifested assent to the essential terms through email, payment, and affirmative responses.
- A party’s silence or failure to object to a settlement confirmation email, combined with payment of the agreed amount, constitutes objective evidence of assent to settlement terms.
- Formal documents like mutual general releases serve to memorialize an already-formed settlement agreement, not to create the condition precedent for settlement formation.
Why It Matters
This decision clarifies that settlement agreements in construction disputes and lien foreclosure matters can be enforced even without fully executed formal documents, provided the parties have objectively manifested their assent through their conduct and communications. Contractors and property owners should be aware that making payment and responding affirmatively to settlement terms—even informally—may create binding settlement obligations. Conversely, parties wishing to preserve their position should promptly object to settlement proposals rather than remaining silent.
For attorneys handling construction disputes and lien matters, the decision underscores that the absence of a signed release is not dispositive of whether settlement occurred. Courts will examine the full course of dealing between the parties, including emails, payments, and affirmative communications, to determine whether the parties objectively agreed to settlement terms. This can cut both ways: settlement-minded communications may lock in a deal even if formal paperwork is never completed, requiring careful language in preliminary settlement discussions to avoid inadvertent commitment.