Background
Felicia Landers sued Hector Garza and Francisco Zarate after a November 2024 automobile collision. After Garza and Zarate answered, Landers sent their insurer a time-limited settlement demand for $55,000 under OCGA § 9-11-67.1.
The demand required written acceptance by May 19, 2025, and required payment plus a sworn statement concerning available coverage by May 29. The defendants timely sent written acceptance and tendered payment, but the insurer supplied the coverage affidavit on June 6. Landers purported to rescind, and the trial court denied the defendants’ motion to enforce the settlement, ruling that the late affidavit meant the offer had not been accepted.
The Court’s Holding
The Court of Appeals vacated and remanded. It held that Garza’s timely written acceptance created an enforceable settlement contract because the demand expressly made only written acceptance by May 19 a condition of acceptance. The later deadline for the coverage affidavit was a contractual performance term, not a condition that prevented contract formation.
The court did not decide whether the eight-day delay was a material breach permitting Landers to rescind. That question may require resolving disputed facts, including whether time was of the essence and whether the delay defeated the contract’s object. The trial court must address those issues on remand.
Key Takeaways
- A settlement demand’s performance deadlines do not necessarily define conditions of acceptance.
- Timely, unequivocal written acceptance formed the contract here despite the later coverage-affidavit submission.
- Whether late performance supports rescission depends on materiality and may be a fact question.
Why It Matters
The decision distinguishes formation of a settlement contract from a later alleged breach. Demand drafters seeking to make a requirement a condition of acceptance must say so clearly.
For post-answer motor-vehicle settlement demands, litigants should also recognize that a stated deadline alone does not necessarily make time of the essence or establish a material breach as a matter of law.