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Home My WebLink About97-03987 ~ , \) ~ - -....--. -_.... .. ~~...~;"4~~Ii~: ~.~-:-:z:~~_...... . ~._.,. The additioaal payment will noc be considered part of the purchase order. or in any way be considered by Herre Bros. in deciding whether to award a contract to Keller for which Keller bas placed a bid. Nothing in the Settlement Agreement and Release shall be considered as Herre Bros. giving Keller preferential treaanent in any business de:1ling in which the twO parties are involved. and Herre Bros. shall in no way be required to give Keller preferential treaanent in the awarding of purchase orders in the future. All de3lings between Herre Bros. and Keller have been. and shall hereinafter remain. at arms's length. 3. After P:1ragraph I. we suggest adding as P:1l':1J!:1ph 2: Herre Bros. and Keller shall complete the terms described in paragraph 1. above. within eighteen (18) months of the date of this agreement. If Keller has not tendered the full amount of S10.ooo.oo in that time. Herre Bros. may immediately call the e:ltire rc"".ining amoUnt due by ncCf:1ng Ke!!er. in writing. that Herre Bros. demands the oUISanding ba1al:ce. Upon receipt of the notice. Keller shall within ten (10) days. deliver the amountS due and owing. 4. After Paragraph 3. we suggest adding as pangraph 4: In the event that Keller defaultS in payme:t of funds due Herre Bros. under this agreement. either by failing to pay any of the $1.000.00 amountS as required under paragraph 1. or by failing to pay the balance within ten (10) days after receipt of netic: as required in pangraph 2. the release granted by Herre Bros. and descnDed above in paragraph 2 shall be deemed null and void and Herre Bros. shall be entitled to pursue any righcs and remedies available to it under the law and at equity. including an action for breach of contraCt or cegligence. as if no settlement had been reached. and Keller waives any righc to assert the Statute of limitations as a defense. Herre Bros. shall be entitled to receive from Keller all r=sonable costS and fees. including attorneys fees. expeaded by Herre Bros. to enforce the termS of this Alrcement or to pursue recovery in the event action is brought upon default by Keller. Another SUISCStion wculd be that Keller Sill1a ~ote for S10.000 with a confession of judrmenc m1 paymentS being ae:omplished over eighteel1 (18) months In the man.cer c1escnDed above. This would alleviate the nc:d for much of the lanruage in paragraph 4 above. Calls bill.d la . ' 717428.0420 , I i ,j ~ ~ "" " " .:t ", " 'j , .~ . i-:" DEFENDANT'S EXHIBIT 's1111'1~ I ~ i- t> :.: l'\o\" :~ So:5() pn: ~;:~~"l, :irv ~." ~:S.f;50~ !\ It' t'.: 1: ~ov 24 9:59 pn, ~pnnE Gn' P/\ 7;' ::H50h "Ieht Q~ 2) Nov 25 H:39 urn HarrJlburt. P/\ 711 232.9743 Day ~ .!so; 2< Nov 25 9:21 am Cartisle PA '!li :49.15J5 Day : 33 25 Nov 25 10:38 am Harrisburg PA 717 232-9743 Day , .33 . 2. Nov 25 10:3E am LitiL: PA 717627.3939 Oa)' 3 ,50 2"; r\O'l 25 11:17 am Ha"isbu'g PA ; r"7 ~32.9743 Day J ,16 2\ Nov 25 3:23 pm Myemown PA 717 866.6643 Day , .33 - 29 No,' 25 3:58 pm Hl<lisburg PA 717 232.9743 Day 5 ,84 30 Nov 25 4:48 pm Harrisbulg I' A 717 255-8052 Day 12 2.01 Above call continued in GTE Discount c"lling Plan 31 Nov 25 5 :00 pm Ha,risburg PA 717 255-8052 Day 20 3,36 Above call continued from GTE Discount c"Umt Plan 32 Nov 25 5:35 pm Lewisberry PA 717938-6243 Day 1 .16 - 33 Nov 26 10:44 am Ha"isburg pA 717 732-4454 Day 1 ,16 34 Nov 26 10:57 am Moun: Joy PA 717 653-4044 Day 1 .16 35 Nov 26 10:58 am Denver I'A 717 335.3882 Day 2 ,33 36 Nov 26 11:57 am Litiu PA 717626.4781 Day 5 .g4 37 Nov 26 12:14 pm Mount Joy PA 717 653-4044 Day 2 ,33 - 31 Nov 26 1:42 pm Harrilburg pA 717732-4454 Day 12 2,01 39 Nov 26 2:04 pm Harrisburg I' A 717 255.8052 Day 10 1.68 .. -- -- - -D ---.... \ "'\JJ.uataeo)- '.. GTE Discount Calling Plan. 15% Option (continued) Direct Dialed Calls (continued) Date Time Plae. .alled Number .alled Period Min. Amount I Nov 26 2:14pm Lewisberry pA 717 93g.6243 Day 1 S .16 _ 2 Nov 26 2:35 pm Harri1burg I' A 717 732-4454 Day 1 .16 3 Nov 26 2:36 pm Hanov.r pA 717 637-3711 Day 2 ,23 - 4 Nov 26 2:57 pm Harrisburg pA 717 732-4454 Day 2 ,33 5 Nov 26 2:59 pm Harrilburg pA 717 255-8052 Day 2 ,33 6 Nov 26 3:39 pm Utiu PA 717 626-4781 Day 23 3,g6 1 Nov 26 4:04 pm Harri.burg pA 717901.7055 Day 1 .16 1 Nov 26 5:07 pm Harrisburg PA 717 255-8052 Day 2 ,33 9 D.d 10:10 am Myemown PA 717 866.6643 Day 1 .16 10 De<: 1 11:12 am Harrisbura P A 717 255-8052 Day 6 LOO 11 De<: 1 11 :55 am Wrighuvl PA 717 252.3411 Day 1 ,11 12 De<: 1 12:28 pm Wrighuvl PA 717 252.3411 Day 2 .23 II Dee 1 1:37 pm Lancaster PA 71 i 397-4729 Day 8 1.34 14 Dee 1 2:06 pm Wrighuvl PA 717 252-0568 Day 1 ,11 IS De<: 1 4:34 pm Hanover pA 717 637.3711 Day 1 ,11 16 De. 2 10:17 am Lewisberry PA 717938.6243 Day 2 ,33 17 De<: 2 10:37 am NewBlomFld pA 71 i 582.7403 Day 1 .16 18 Dee 2 10:42 am Harri1bura PA 717 232.9743 Day 2 ,33 U Dee 2 11 :24 am NewBlomFld PA 717582-8656 Day 2 .33 20 Dee 2 2:25 pm Harrisbura P A 71 7 233.6431 Day 3 ,50 21 Dee 2 3:52 pm Utitz PA 717 626.9555 Day 1 .16 22 De<: 2 3:56 pm Utitz PA 717 626.9S55 Day 1 .16 23 De<: 2 4:02pm Utitz PA 717 626-9559 Day 1 .16 24 De. 2 4:35 pm Quarryvl I' A 717 786-4746 Day 3 ,50 25 De.: 3 9:53 am Olainbenlif PA 717267-3114 Day 2 ,33 2t De<: 3 ~ 11:59 am Carlisle PA 717 249.1535 Day 8 1.34 27 De<: 3 1:07 pm Harrilbufi PA 717 233-6431 Day 2 .33 .21 De<: 3 3:17 pm Harrisburg I'A 717 236.7672 Day 1 ,16 I, '. :.\~~ ..... ,', 29 De<: 3 4:10 pm Olambersbg PA 717 267.3114 Day 2 .33 :~. " 30 De<: 4 11:42 am Carlisle PA 717249.1535 Day 2 ,33 "\" , 31 Dee 4 12:46 pm Carlisle PA 717 249.1535 Day 2 _33 , 32 De. 4 1:25 pm Laneaslet PA 717 464.5077 Da7 5 _84 ~.. J3 Dee 4 1:33 pm Uvorpool pA 717 444-3669 Day 3 .50 " .- 34 Dee 4 4:27 pm Lewilberry pA 717 938-6137 Day 1 .16 . H Dee 4 4:28 pm Lewi5bury 1'.... 717938.6137 Day 1 .16 36 Dee 5 9:01am Carlisle PA 717249.1S35 Day 7 Ll7 37 De<: 5 1U5 am Harrisbura P A 717 232-9743 Day 3 ,so JI Dee 5 12:19 pm Hanover FA 717637,3711 Da7 1 ,11 J9 Dee 5 12:23 pm Harrilburg pA 717 232-9743 Da7 2 ,33 to De<: S 3:04 pm Harrisburg PA 717 939-3600 Da7 4 .67 41 De. 5 3;SS pm Harrisburg P A 71797$-6411 Day 2 .33 4' Dee I 9:35am Carlisl. l'A 71i 249.1S35 Day 3 ,SO 43 Oec 8 10:53 am L1Utz PA 717 626-4711 Day 13 2,11 , C ~ I )j :a~ '1"ntM)t ".I1U t1 eJ t'''tll.lt~l.O''1 DOra....., .~;Ut)' -- MI....TM L "'L.~EN N OAIIIO RAHAL. WIL.L.....M E. M'Ll.ER, ..,IA. CHAlItLlS W. RUBENOALL. II "OBERT 1.. WEI.ClON EUGENE I. PE~NS~T. .lilt. THO......S E. wOOD ...OHN H. ENOl W GA."" E. ,.,'(NCM OONNA S. WELDON 8"...0"0"0 OQ''''AHCr. ..I1,.,.'!tEY S. STOKES ROIIERT ft. CHURCH STr.~Hr.H L. GROSr. lit. SCOTT SHURER WAYNE M. ~ICHT OO"'AL.O .... I.EWIS m .RIOOlT ..... WHITLEY KARCH ."OTHERS MAY ."CND4 S. LYNCH SHAWN W. WIIS KEEFER WOOD ALLEN & RAHAL, LLP 210 WAL.NUT STREET P.O, BOX 11963 HARRISBURG. PA 17106'1963 ISU.Bl".IIHEO IN .117. 0" COUNSEL.; WILLIA"'" H. WOOD SAMUEl. C. H",,,,,., PHONE (717) 25!H1000 ""X (7'7) 255'80!lO wIEST ."'OJIIE O""ICE; 4115 'ALLOW'IILD "OAD CAMP HIL&a. "... 170U ltlN NO 2:1,-0718135 November 17, 1997 ~OHr. (7171 ell-saoo 'AX (717. ell'SIOl ."ITI."'. o.lItleT OIAl.' . 255-8052 ~ Mr. George A. Keller 173 Park Street Loganville, PA 17342 Re: Herre Bros., Inc. v. George A. Keller, t/d/b/a Keller Engineering Services Court of Common Pleas of Cumberland County Civil Action 97-3987 Dear George: Enclosed please find a copy of the letter I received from Steve Grubb, dated November 14, 1997. They've countered with $5,000 in cash and an additional $15,000 to be paid in 1998. Please give me a call so that we can discuss ~his matter and frame a response. Sincerely, KEEFER WOOD ALLEN & RAHAL, LLP By ...~. ...(-.. 1~,.\q1 St:2en L. ::~S ~ If. ,1, 0 J f.. 01- f ~.YJ 1 e,~fO"""" ...11/1 c\\~~ ~\ ~~"v $ 1'1 DOD. ~~tr 6 ,\>uCJ ~t.--- ~\)t- prG~ \rJ....A. . 'I 0 plttO ~Lif b~ ~l) 1) e.Pi , ~ ~'V\JL ^ 10,00 (ttf...J/oooD t. \~I ~,ttr ~ ,\ . ~-f' ~ I 1) B I.~ .1 ~ '" ,'<:' "^ b c.c)~ ~ l' tI'" "( .t' Q,~ D q' \ 1'lt I 'j i?o'r~ (,\l -D V '1 . .J SLG/klf Enclosure ~ ,r RE!......lVED DEe 0 5 I1J7 l.,AW orrlCES GOLDBERO. KATZM.A~ Be SHIPM.A~. P,C. lIOH"":I ... 1lCAr:~..." MAli'" . GQ.O.VI!~ , I.U SMI'......" "AU\. ~. U'05"Q "CI,,"INQOlI~T J ~,., eoon. '...e,...., t. P(!\IlNC'" ,;C)tolHA. srArl.~ .."II.!,..I''',,'''G.''UT.toT Guy .. IlllOOtC S Ju~t"S04't J IM,'''AH .....,.. S. 'C\JCHTCNICIlIGl:III "iOUIIl' J "VISO "CI4,t.CI. J. CIIIOCt/ltZl """01." t. 1100"'" fMO." J .UP tVAN .I. 1IC1.1Hl. :. JCMrf Cc..OIItNZQ I ftlDe t. 0'tUH DIANA ..OOOICt ~. ..c.." ::tea )lA.allT STalET ST..WS...V SQu.a. p.g. DQX tRee K"'..ISIU':&O. '1"',.-sTLv.......r.... 1110a-taee TIL&PIlO"'Z: (TiT) 2:)4."181 PAX: ITIT' 2:14-0'0. rta". &.H.AJL: ou.oaSL./.W-C'OM A"~" 00..*"0 0' COUhler. ..clltSJolC" Q"let 5.3 '",UT CHQCQ\.AfC AvtNUI: , Q 10. 'S' ~JtS..c1' ~.. 1703.1 11171 533.0&0.. C"'''I.I'I.( =''''CC ,.1 .tlf _O",,'''(f ".IEU CAIIt1.ISI.E. .... 1701.1 ;7171 ,.,-OS.' . December 4, 1997 .. fOlltlC O""'C(. I wll r .....".(1" S 'lItltT , .0'''1. ,.., '7.0t 17111...1.'." IC~"fPONO ~o "..".......0 OI'WlCCI Stephen L. Grose, Esquire Keefer, Wood, Allen '" Rahal 210 Walnut Street P.O. Box 11963 Harrisb::rg, PA 17108-1963 Re: Herre Bros.. Inc. v. George A. Keller, lldlb/a Keller Engineering Services No. 97-3987 Civil Dear SteVe: I have oontacted my client pertaining to your lercer dated December 1. The cenns which you stated in the first paragraph are correct with the following additions. My client infornu me that the two principals also aped that if Keller Engineering wishes to pay more than S2,000 for a particular purchase order for S50.000 and above, they may do so, as long as the total amount being paid by Keller to Herre Bras. totals SI0,000. In other words. the SIO,ooo paid can be accompUshed in fewer than 5 purchase orders. if Keller Eng:ineering wishes to pay more on a job over S50,OOO. Please swc in the Settlement Agreement that a $1.000 payment is a minimum payment, with anything in excess of that being counted against the SIO,OOO payment. As for the remaining portions of your letter to me. we would be willing to grant a release tohyour client and I will have the action marked settled and discontinued, with prejudice. upon your client's payment of the initial $7,000, and my being provided with an executed copy of the Settlement Agreement and Release. I look forward to your promptly providing me with the dr3it of the Settlement Alt'eertIClIt and Release. I Sin~ly, - 1/ ~ .,F" ~S~~n E. Grubb DEFENDANT'S EXHIBIT s1"'ty ~ SEGiksd ;:: Ed\ll3J'd a. Grimm hereto as ElIhibit "A" and incorporated here by reference. 5. In response, counsel for Herre Bros. countered with an offer of $20,000, with $5,000 to be paid immediately and the remainder to be paid in 1998. A true and correct copy of the letter from Herre Bros.' counsel to Keller's counsel dated November 14, 1997, is attached hereto as ElIhibit "B" and incorpor.lted here by reference. 6. On November 26. 1997, Keller called Ed Grimm, Senior Vice President of Herre Bros.. to discuss settlement. Thcre were several calls that day. The final call resulted in Keller agreeing to pay Herre Bros. $7.000 by December 31, 1997. In addition, Keller agreed to pay at least $2.000 to Herre Bros. on each of the nellt lhc (5) purchase orders of $50.000 or more that were awarded by Herre Bros. to Keller. No time limitation relative to the payment of the final $10,000 was considered with the final offer, nor agreed to by the panics. 7, Mr, Grimm indicated he was accepting these tenns because he wanted to get this matter behind him. The settlement was not made contingent upon ellecution of a written agreement, although both parties agreed that one would be prepared and Keller stated he would have his attorney prepare one bused upon thc settlemcnt tenns. 8. Keller advised his counsel to prepare thc settlement agreement but counsel for Keller advised they should confinn the tenns of settlement with counsel for Herre Bros. first, which was done in 01 letter dated Dc\:ember I. 1997. A true and correct copy of tbatletter is attached hereto as Exhibit "C" and incorporated herein by reference. 2 9. As noted in that letter. counsel for Keller conlirmed that the principals had "settled" the matter and set forth the tenns of the settlement as relayed by Mr. Keller. In the second paragraph of that letter. counsel for Keller set forth the procedure for the exchange of documents and the check and discontinuing the matter. 10. In a reply letter dated December 4, 1997. counsel for Herre Bros. conlinned that he had contacted his client pertaining to the December I. 1997 letter and indicated that the tenns of the settlement as stated in the first parolgraph of that letter "are correct" with the exception that the two principals also agreed that if Keller wishcd to pay more than the $2,000 minimum on a particular purchase order. he may do so. That was the only additional tenn counsel for Herre Bros. indicated was part of the settlement. A true and correc: copy of that letter dated December 4, 1997, is attached hereto as Exhibit "0" and incorporated here by reference. II. After the settlement and the tenns thereof had been confinned in a writing by counsel for Herre Bros., counsel for Keller prepared the Settlement Agreement and Release, containing the tenns of the settlement as agreed to by Mr. Grimm on November 26. 1997 and conlinned by counsel for Herre Bros in his letter of December 4.1997. A true and correct copy of the cover letter and the initial draft of the Settlement Agreement and Release are attached hereto as Exhibit "En and incorpor.JIed here by reference. 12, In response to the Settlement Agreement and Release, counsel for Herre Bros. suggested several minor relinements to the language of the Settlement Agreement and Release, which did not materially affect the tenns of the settlement. They were contained as items t. 2, 3 and 4 in his letter to counsel for Keller dated December 18. 1997. hem #3 of that letter, however. requested that a time limitation of 18 months be imposed for the repayment of the $10.000 to be paid from the (5) jobs of $50.000 or more. This term had not been agreed to by the parties on November 26. 1997, was not part of the settlement and was not contained in any of the prior correspondence between counsel for Keller and Herre Bros. when confirming the terms of settlement reached between the parties. A true and correct copy of the letter dated December 18. 1997, from counsel for Herre Bros, to counsel for Keller, is attached hereto as Exhibit "F' and incorpor.lted here by reference. 13. Upon receipt of that letter, counsel for Keller called counsel for Herre Bros. and advised that the 18 month time limitation period was not a term of the settlement and would not be included in the Settlement Agreement and Release. In response, counsel for Herre Bros. sent a letter to counsel for Keller dated December 26,1997, indicating that Herre Bros. would not now settle this matter without a Settlement Agreement and Release that provided that the $10.000 payments be completed with 18 months of signing the Settlement Agreement and Release. A copy of the letter dated December 26. 1997 from counsel for Herre Bros. to counsel for Keller is attached hereto as Exhihit "0" and incorporated here by reference. 14, The December 26, 1997 letter does not indicate that such a term was part of the settlement reached on November 26. 1997. but simply states "We believe this term to be a reasonable term and if your client is not agreeable to induding such a term, we will proceed forward with litigation." .. IS. Counsel for Keller revised the Settlement Agreement and Release, including those refinements requested by counsel for Hcrre Bros. that were not changes to the substance of the settlement <1&. items I. 2 and 4 in Exhibit "F"). had Keller sign the same, and delivered that agreement along with a certificd check in the amount of $7.000 to counsel for Herre Bras.. in accordance with the terms of settlement and the Settlement Agreement and Release. A true and correct copy of the letter. certified check and Settlement Agreement and Release, are attached hereto as Exhibit "H~ and incorporolted here by reference, 16. Counsel for Herre Bras, retumed the Settlement Agreement and Release and the cheek and refused to honor the settlemcnt. now contending that no settlement had been reached. 17, Enforcability of settlement agreements is determined according to principals of controlCt law. If all of the maleriallerms of the bargain are agreed upon. the courts of Pennsylvania will enforce the settlement. CenturY Inn.lne, v, CenturY Inn Realtv.lnc.. 516 A.2d 765 (Pa. Super. 1986); KiIlaniian v, New EOIdand Petroleum Com,. 332 Pa.Super 1,480 A.2d 1153 (1984). 18. There is a long standing public poliey that enelluroIges settlcments. Muhammad v. Strassbumer. McKenna. Messer. Shilllbod and Gutnkk. 526 Pa. 541. 587 A,2d 1346. !IJ![i, !kn,. 528 Pa. 345, 598 A,2d 27. rnt, den.. 502 U.S. 867, 112 S,Ct. 196, 116 L.Ed, 2d 156 (1992); Rothman v. Fillctte. 503 Pa. 259. 469 A,2d 543 (1983). 5 .. _.....4 ~...__... j ExhIbItC i I i I I I I I B i I r . . . . '. ---- - - -,'" ~'" "~.. . f IEf"'UED DEe 0 5 J997 LAW OFFICES GOLDBERO. KATZMAN & SUI PM AN. p,c. 'U).....I.D lit <<AU"'''''' "....II', . OO~Q'["Q ,. LEt SMI~M"N ....u!,. .J (POIl'Q 1\l(11.. ..[/lrfoc;JtSMQT J ,JAY coo~" TH().....Sl '''(NIol('' JOHN'" ""fLt.. """'1,. L ".......o.MU,...., GUT" 8'10011; S .J("lJtSOt\l J &MI""'A'" .....'N I 'tVCMT(!llIIUGtlll ...("AY J .uSIO ...1C......(1,. J (_OCt"'ZI ....NOLD. ...CO...... T"'O.....,) wtlt" (VAN J ItLlfllt It! JOtolH CCLC)A[NIO IT[vtH ( GAulI 0.""'''' woocact ~......olll.' OIlO MARan STRS;.T STRAWBERRY SQUARS P Q. BOX lliloe H..a.seURO. .BNHSYLVAHIA 17108'11l08 TItLBPHOJtlE: (717IUD.....8. PAX' (717' aCM-880e PINN ..MAIL. ouOO..LA.WCON Ht","U O,,'.ct "3 wUT C..oC01.ATt AvtHUt II 0 loa '55 .cA1H(.1 .... ,'0:U 171" 533.40.' ,.It,""", L GO!..o.c:ItG 0' COU'\lltL C..."\.IIL[ 0"'1(1 '3 wUT "0"'''[' STAn' ''''''LIILt, ..... 11013 1'171''''.OS.' December 4, 1997 ,Olt. 0'''<1: , wElT M....IlET Sr.'rtf yOll.(,..... 17.01 17,7' '.3. '1" lCQtllttPOND TO "AMttSIUtllG 0'''1<:1 I Stephen L. Grose, Esquire Keefer, Wood, Allen &. Rahal 210 Walnut Street P.O. Box 11963 Harrisburg, PA 17108-1963 Re: Herre Bros., Inc. v. George A. Keller, t/dlb/a Keller Engineering Services No. 97-3987 Civil Dear Steve: I have contacted my client pertaining to your letter dated December 1. The tenns which you stated in the tint paragraph are correct with the following additions. My client infonns me that the two principals also agreed that if Keller Engineering wishes to pay more than $2,000 for a particular purchase order for $50,000 and above, they may do so, as long as the total amount being paid by Keller to Herre Bros. lIJCaIs $10,000. in other words, the $10,000 paid can be accomplished in fewer than 5 purchase orders, if Keller Engineering wishes to pay more on a job over $50,000. Please state in the Settlement Agreement that a $2,000 paymenl is a minimum payment, with anything in excess of thaI being counted againsl the $10,000 payment. As for the remaining pol1ions of your letter to me, we would be willing to granl a release to your clienl and I will have the action marked settled and discontinued, with prejudice, upon your client's payment of the initial $7,000, and my being provided with an executed copy of the Settlemenl Acreement and Release, Iloolc forward to your promptly providing me with the draft of the Settlemenl Agreement and Release. 1 Sincerely, l pH ~- /:.J ./ .SteVen E. Grubb SEG/ksd cc: Edward R. Grimm Exhibit E '. . . r \ . . - _1;\"-~_~_......-- ~':'''''''''''''_..",,", -,:'1;,..,.., "" ....___~~~~. . SETTLEMENT AGREEMENT AND RELEASE This Settlement Agreement and Release is executed this day of December. 1997. between Herre Bros.. Inc. with its principal place of business located at 4417 Valley Road, Enola, Cumberland County. Pennsylvania (hereinafter 'Herre Bros,') and George A. Keller. t/d/b/a. Keller Engineering Services, with its principal place of business at 173 Park Street. Loganville. York County. Pennsylvania (hereinafter 'Keller'). WHEREAS, on or about April 16. 1997. Herre Bros. was preparing to submit a bid to provide services to the Shrewsbur~I School District; and. WHEREAS, Keller submitted a proposal in regard to providing certain equipment to Herre Bros. ('Proposal'); and. WHEREAS, disagreements arose as to whether or not the Proposal was withdrawn by Keller or had been properly relied upon Herre Bros. in submitting its bid. resulting in a lawsuit being filed with the caption Herre Bros.. Inc. v. Georae A. Keller, t/d/b/a Keller Enaineerina Services. Civil Action Number 97-3987, in the Court of Common Plea of Cumberland County ('Lawsuit'); and. WHEREAS, the parties wish to resolve all matters relating to the Proposal and the Lawsuit. NOW THEREFORE. the parties hereto. with the intent to be legally bound and for the consideration set forth below. agree as follows: 1. In exchange for Herre Bros. providing a release to any and all claims relative to any matters relating to the Proposal or the Lawsuit, as set forth below, Keller will provide a check made payable to 'Herre Bros.. Inc..' in the amount of $7,000, on or before December 31. 1997. In addition, Keller will pay $2,000 to Herre Bros. on each of the next five purchase orders of 550.000 or more that are awarded by Herre Bros. to Keller. This will aggregate to an additional 510.000 being paid by Keller to Herre Bros.. providing the purchase orders are issued. If Keller wishes to pay more than 52.000 for a particular purchase order. he may do so. The $2.000 is a minimum payment. with any funds paid in addition to that amount being applied to the total S10,000 payment. 2. Herre Bros.. Inc.. its assigns and successors. subsidiaries and agents. hereby releases and forever discharge George A. Keller. t/d/b!a Keller Engineering Services, and Keller Equipment Sales. Inc.. their respective heirs. successors. assigns. of and from any and all actions. causes of actions, claims. demands. damages. expenses. consequential damages. or any other claim or demand of any nature whatsoever. whether known or unknown, from the beginning of time to the date of this release, as relates, directly or indirectly, to the Proposal or the Lawsuit. 3. Within ten (10) days of rece~v~ng an executed copy of this Settlement Agreement and Release, and a check in the amount of $7,000, Herre Bros. will file a praecipe dismissing the Lawsuit, with prejudice, and provide counsel for Keller with a time-stamped copy of the same. 4. This Settlement Agreement and Release contains the entire agreement between the parties, is contractual in nature, and may not be altered, except in writing, signed by all parties. 5. It is understood that the sole consideration for this Agreement is as set forth above, and that the consideration constitutes a fair and reasonable settlement of any and all matters as indicated. 6. It is acknowledged that the execution of this Agreement does not constitute an admission of any party, but is a negotiated settlement of disputed claims. 7. The parties hereby certify that the terms of this Agreement have been completely read, are fully understood, have been reviewed by the respective counsel, and are voluntarily entered into for the purposes of making a full and final compromise as set forth above. 8. To the extent that any disagreements arise relative to this Agreement, they will be controlled by the laws of the Commonwealth of Pennsylvania. IN WITNESS WHEREOF, the parties set their hands and seals the date written above. Attest: Herre Bros., Inc. ~: Witness: George A. Keller, Individually Witness: George A. Keller, t/d/b/a Keller Engineering Services Exhibit F \ .. ...."'" ~~<'.} -.,<: ,~;J '.....',_ """'~".'-",I' ;-'" . - _.~~- .~,,j,'-- ,.. ._-~"". '4'" .f"~'-'_, l -"~" I GOLDBERG. KATZMAN & SHlrMAN. P.C, ( The additional payment will not be considered part of the purchase order. or in any way be considered by Herre Bros. in deciding whether to award a contract to Keller for which Keller has placed a bid. Nothing in the Settlement Agreement and Release shall be considered as Herre Bros. giving Keller preferential treatment in any business dealing in which the two parties are involved, and Herre Bros. shall in no way be required to give Keller preferential treatment in the awarding of purchase orders in the future. All dealings between Herre Bros. and Keller have been. and shall hereinafter remain, at anns's length. 3. After Paragraph 1. we suggest adding as Paragraph 2: Herre Bros. and Keller shall complete the tenns described in paragraph 1, above. within eighteen (18) months of the date of this agreement. If Keller has not tendered the full amount of $10.000.00 in that time, Herre Bros. may inunediately call the entire remaining amount due by notifying Keller, in writing, that Herre Bros. demands the outstanding balance. Upon receipt of the notice, Keller shall within ten (10) days, deliver the amountS due and owing. 4. After Paragraph 3. we suggest adding as paragraph 4: In the event that Keller defaults in payment of funds due Herre Bros. under this agreement, either by failing to pay any of the S2,OOO.00 amounts as required under paragraph 1, or by failing to pay the balance within ten (10) days after receipt of notice as required in paragraph 2. the release granted by Herre Bros. and described above in paragraph 2 shall be deemed null and void and Herre Bros. shall be entitled to pursue any rightS and remedies available to it under the law and at equity. including an action for breach of contract or negligence, as if no settlement had been reached. and Keller waives any right to assert the statute of limitations as a defense. Herre Bros. shall be entitled to receive from Keller all reasonable costs and fees, including attorneys fees, expended by Herre Bros. to enforce the tenus of this Agreement or to pursue recovery in the event action is brought upon default by Keller. Another suggestion would be that Keller sign a Note for $10.000 with a confession of judgment and payments being accomplished over eighteen (18) months in the manner described above. This would alleviate the need for much of the language in paragraph 4 above. Exhibit G i. .,.,.'c. ;.e"','::,........q , - . .....;;- c:;..____ ~ .'~:.-.-., ,."... .~:.;.~ ... ";... ElchlbIt H " , . . . '.' .----','-'- .......,-,- ~"41] "";""''''''!"~.,~. -",.~~.,~~ ...t. . - ... _,:..,_.,.,.,,,, 1" -, ( , { December 30, 1997 255-8052 HAND DELIVERED steven E. Grubb, Esquire Goldberg, Katzman , Shipman P.C. 320 Market Street PO Box 1268 Harrisburg PA 17108-1268 Re: Herre Bros" Inc. v, George A, Keller, t/d/b/a Keller Engineering services civil Action 97-3987 Court of Common pleas of Cumberland Countv Dear Steve: I am in receipt of your letter dated December 26, 1997, relating to the above matter. As you know from our previous communications and correspondence, it is our position that a settlement agreement was reached in the above matter and its terms were set forth in my letter to you dated December 1, 1997, which you confirmed in your response letter to me dated December 4, 1997. My letter to you dated December 8, 1997, enclosed the Settlement Agreement and Release ("Settlement Agreement") drafted as per our agreement, It was not until I received your letter of December 18, 1997, that we were aware that Herre Bros, wished to re-negotiate a very substantial element of the Settlement Agreement, namely that the $10,000 additional payment (comprised of five, $2,000 payments) be made within some set period of time, without any assurance that the five jobs in the amount of $50,000 or more would also be awarded to Keller within that time frame, I point out that in your letter dated to me dated December 4, 1997, you indicated that you contacted your client pertaining to my letter of December 1, 1997, and you confirmed that the terms that were stated in the first paragraph of my letter were correct. You requested that we incorporate into the Settlement Agreement a statement that the $2,000 payment on each of five jobs was to be a minimum payment and that anything in excess of $2,000 would be steven E. Grubb, Esquire Page 2 December 30, 1997 counted against the total of $10,000 to be paid, That was the only additional term, and my client agreed to the same, In your letter of December 18, 1997, you requested several non-SUbstantive changes (that we make the check a "certified" check, that we incorporate language to assure third-parties that the additional payment would not hinder the "arms-length relationship" between Herre Bros, and Keller, and that we include language that if either party breaches the settlement Agreement, the non-breaching party could recover reasonable costs and attorneys fees) to which we have no objection. However, we were not agreeable to the alteration that the $10,000 must be paid within 18 months, which was a substantive change in the material terms of the Settlement Agreement. Accordingly, I have had my client execute the Settlement Agreement in the form agreed upon, which includes the non- subs~antive changes that you suggested, Also enclosed is a certified check made payable to Herre Bros, Inc, in the amount of $7,000, in accordance with the agreement, You are to hold this check in escrow pending your client executing the Settlement Agreement. My client has complied with all of the terms of the Settlement Agreement reached between the parties. If your client refuses to abide by those terms (or mutuallv aareeable revisions to the original Settlement Agreement) we will be forced to either file an action for enforcement of the Settlement Agreement andlor amend our Answer to plead the affirmative defenses of release and accord and satisfaction. It is my understanding that Mr. Keller will be speaking with Mr. Grimm personally on this matter, I am hopeful that this issue can be resolved so that the parties can be put this unfortunate event behind them and work at restoring with their working relationship. Sincerely, KEEFER WOOD ALLEN , RAHAL. Lt.. By Stephen L, Gros. SLG/klf Enclosur. cc: George Keller (w/encl.) ( SETTLEMENT AGREEMENT AND RELEASE This Settlement Agreement and Release is executed this --- day of December, 1997, between Herre Bros" Inc, with its principal place of business located at 4417 Valley Road, Enola, CUmberland County, pennsylvania (hereinafter "Herre Bros,") and George A, Keller, t/d/b/a, Keller Engineering Services, with its principal place of business at 173 Park Street, Loganville, York County, Pennsylvania (hereinafter "Keller"). WHEREAS, on or about April 16, 1997, Herre Bros, was preparing to submit a bid to provide services to the Shrews burry School Districti and, WHEREAS, Keller submitted a proposal in regard to providing certain equipment to Herre Bros, ("Proposal")i and, WHEREAS, disagreements arose as to whether or not the Proposal was withdrawn by Keller or had been properly relied upon Herre Bros. in submitting its bid, resulting in a lawsuit being filed with the caption Herre Bros.. Inc. v. Georae A. Keller, t/d/b/a Keller Enaineerina Services. Civil Action Number 97-3987, in the Court of Common Plea of Cumberland County ("Lawsuit")i and, WHEREAS, the parties wish to resolve all matters relating to the Proposal and the Lawsuit. NOW THEREFORE, the parties hereto, with the intent to be legally bound and for the consideration set forth below, agree as follows: 1, In exchange for Herre Bros. providing a release to any and all claims relative to any matters relating to the Proposal or the Lawsuit, as set forth below, Keller will provide a certified check made payable to "Herre Bros., Inc.." in the amount of $7,000, on or before December 31, 1997, In addition, Keller will pay an additional $10,000 to Herre Bros, under the following conditions: for each subsequent purchase order awarded by Herre Bros. to Keller which amount exceeds $50,000, Keller shall pay a minimum of $2,000 to Herre Bros, in addition to the amount of the purchase order. The payments of $2,000 shall be a minimum amount and shall be paid to Herre Bros, until such time as the total of Keller's $10,000 obligation described above is satiSfied. This will result in an additional $10,000 being paid by Keller to Herre Bros., provided the said purchase orders are issued, The additional payment will not be considered part of the purChase order, or in any way be considered by Herre Bros, in deciding whether to award a contract to Keller for which Keller has placed a bid. Nothing in the Settlement Agreement and ( Release shall be considered as Herre Bros. giving Keller preferential treatment in any business dealing in which the two parties are involved, and Herre Bros. shall in no way be required to give Keller preferential treatment in the awarding of purchase orders in the future, All dealings between Herre Bros, and Keller have been, and shall hereinafter remain, at arm's length. 2, Herre Bros" Inc" its assigns and successors, subsidiaries and agents, hereby releases and forever discharge George A. Keller, t/d/b/a Keller Engineering Services, and Keller Equipment Sales, Inc" their respective heirs, successors, assigns, of and from any and all actions, causes of actions, claims, demands, damages, expenses, consequential damages, or any other claim or demand of any nature whatsoever, whether known or unknown, from the beginning of time to the date of this release, as relates, directly or indirectly, to the Proposal or the Lawsuit, J, Within ten (10) days of receiving an executed copy of this Settlement Agreement and Release, and a certified check in the amount of $7,000, Herre Bros. will file a praecipe dismissing the Lawsuit, with prejudice, and provide counsel for Keller with a time-stamped copy of the same. 4. In the event either party defaults in the performance of their respective duties under this Agreement, the non- breaching party shall be entitled to enforce the terms of this Agreement and to recover reasonable costs and fees, including attorneys' fees expended in doing so, If Keller breaches this Agreement in any manner, Herre Bros. may elect to treat the release as null and void and pursue any rights it otherwise had under law or equity, 5, This Settlement Agreement and Release contains the entire aqr....nt between the parties, is contractual in natur., and .ay not be alter.d, except in writing, signed by all parti.., 6, It is understood that the sole consideration for this Agr....nt is as set forth above, and that the consid.ration constitut.. a fair and reasonable .ettlem.nt of any and all matters as indicated. 7, It i. acknowledg.d that the .x.cution of this Aqr....nt do.s not con.titut. an admission of any party, but i. a negotiat.d ..ttlement of disput.d clai.s. a, Th. part i.. her. by c.rtify that the t.rm. of this Agr....nt have be.n comp1.t.ly r.ad, are fully und.rstood, have be.n r.vi.wed by the r..pectiv. coun..l, and are voluntarily .nt.red into for the purpo..s of making a full and final compromi.. a. ..t forth abov., .... ('". .... (': lJ-. '; .. N .< l.: , .. . ~ , ti.- : :~~ ,,-/ :::' ,"? L ~;;. ~l; r ,;'.1 L>. 'lQ: t-~ u' ::f " .:0 ., C u' 0 lhe initial telephone conversation. I adviscd Mr. Grimm .hat the offer set forth in their leller dated November 14. 1997. was unacceptable. I offen:d a total of $15,000 over the next five (5) jobs of $50.000 or mon:, indicating to Mr. Grimm that my incn:ase from $5.000 to $15,000 was based upon my ability to obtain these five (5) jobs. 7. Mr. Grimm advised that he wanted a total of $20,000 but that he would extend the time period from 12 months to 18 months to pay the n:maining $15,000. I indicated that was unacceptable. 8. I then offen:d $5,000 cash now and $15.000 upon receipt of five (5) jobs of $50.000 ormon:. Mr. Grimm advised that he would accept $10.000 cash now and $10,000 over the next five (5) jobs of $50,000 or mon:o No time limitation was discussed. I indicated I needed to think about his offer. 9. I called Mr. Grimm later that same day and advised Mr. Grimm that the "magic number is $7,000," which I agreed to pay before the end of 1~97, with $10,000 spn:ad over the next fi\'C (5) jobs of $50,000 or mon:o with a payment of $2,000 on each job. No time limitation was discussed. Mr. Grimm suggested that I could make more than the $2.000 if I wanted. but only $2,000 on each job was required. I agreed. Mr. Grimm agreed. indicating that he wanted to get this matter behind him. to, Then: was no mention of the fi\'C (5) jobs being within any time fr.une, nor was then: any suggestion that the matter was not .hen senled. I advised Mr. Grimm that I would have my anomey prepare a senlement agreement. hasN on the tenns of the settlement we had reached. Mr, Grimm agreed. II. 1 called my counsel. advised him of the tenus of settlcment and told him to prepare a settlement agreement. He advised that we should first confinu the tenus of settlement in writing. As a result, my counsel forwarded a letter to counsel for Herre Bros.. setting fonh the tenus of the settlement reached by Mr. Grimm and me on November 26. 1997. A copy of lhat letter is attached to the Motion to Compel as Exhibit "C". 12. On December 5,1997,1 received a telephone call from my counsel advising me that counsel for Herre Bros. confinued the tenus of the settlement as 1 had relayed them. but requested that we also put in the fact that the $2,000 payment was a minimum payment and that 1 could pay more on any of the five (5) jobs if 1 so desired. My counsel forwarded me a copy of thc letter he received from Herre Bros.' counsel dated December 4. 1997, which is attached as Exhibit "0" to the Motion to Compel. 13. After receipt of that letter. 1 authorized my counsel to prepare the Scttlement Agreement and Release based upon the tenus of settlement reached with Mr. Grimm on November 26, 1997. (and confinned in writing) and forward it to Herre Bros.' counsel. He did so under cover letter dated December 7, 1997. See Exhibit "E" to the Motion to Compel. 14. On December 19, 1997,1 received a telephone call from my counsel indicating that he had received a letter from Herre Bros.' l'OUnsel, wherein they requested sc\'Cral minor refinements to the Settlement Agreement and Release, but in addition. requested that an 18 l1\\\llth time fr.lme be pll1l'l'l1 upon the payment of the $10.000 from the fi\e (5) jobs, without any guarantee of \'eI."ch'ing Ihe (5) jobs within that time frame. This was a material change in the >- c-, " ". 1.;~ ~ ;. ~( ('\j > "".1... '. le" t.'_ <.,f , , '0:> . , (. I.......... . Q!~. (.0 , .. 'j L.. .... ,.. L_ ., . (,- ('~': " (.. V" V The instant matter pertains to an alleged settlement between the panies. George Keller of Keller Engineering Services and Edward Grimm, Vice-President of Herre Bros., on November 26, 1997. Messrs. Keller and Grimm had personally attempted to negotiate certain tenns of a settlement up to November 26, 1997. The parties eventUally agreed that Keller would pay Herre Bros. $7,000 before December 31, 1997. Keller would then pay $10,000 in minimum increments of $2,000 whenever Herre Bros. awarded Keller a bid in excess of $50,000. While agreeing to the above limited tenns, Mr. Grimm made it clear to Mr. Keller that no settlement agreement would be consummated without the execution of a wrinen agreement drafted by the respective parties' attorneys. Additionally, during the talks between Mssrs. Grimm and Keller, Mr. Grimm insisted that the maner be completed by the end of 1998. Later, as a point of compromise, Herre Bros. allowed Keller 18 months from the date of execution of a signed agreement to complete its payments to Herre Bros. Following the talks between Messrs. Keller and Grimm, Mr. Grimm notified his attorneys of the settlement tenns which had been discussed. Mr. Keller volunteered his attorneys to draft the initial settlement agreement. Counsel for Keller did so on December 8, 1997 (see Ex. E of Keller's Motion). By letter of December 18, 1997 (see Ex. F of Keller's Motion), counsel for Herre Bros. suggested four changes to the senlernent agreement. Counsel for Keller accepted and .2.. matters led to agreement, or at least Herre Bros. insistence, that an agreement not be consummated until the execution of a written document. Furthermore, during the course of their negotiations, both panies contemplated their attorneys creating a document. Mr. Keller volunteered his attorney for the creation of the initial draft of the SenIement Agreement and Release. S='8 of Keller's Motion to Compel Settlement and George Keller's Affidavit at "10 and 11. The communications between the attorneys after November 26, 1997 verify the requirement of a signed writing. On December 1, 1997 (Exhibit C of Keller's Motion), counsel for Keller admitted that only upon execution of a document would Keller issue funds to Hem: Bros. be exchanged or the action be discontinued. in a writing dated December 4, 1997 (Exhibit D of Hem: Bros.' Answer to Motion to Compel SenIement), counsel for Herre Bros. pre-conditioned senIement on Herre Bros.' "being supplied with an executed copy of the SenIement Agreement and ReIe3SC. W On December 8, 1997 (Exhibit D of Keller's Motion), counsel for Keller, once again, stated that upon execution of the arreement, the senIement terms would be consununated. Contrary to Keller's Motion, fmal senIement was always pre-conditioned on the existence of a signed writing. It is also clear that the panies had not yet completed negotiating the senIement, which further explains the necessity of a signed writing prior to final sen\ement. On December 18, 1997, counsel for Hem: Bros. sent proposed revisions to counsel for Keller Engineerina. Three -6- of the four suggested revisions MD: 3ccl:pted by Keller and incorporated into the draft Agreement. While counsel for Keller selectively and self-servingly identities these additions as "non material", the changes accepted by Keller were just as material as the one not accepted by Keller's counsel pertaining to the duration of the contract. Next, on January 9, 1998 (see Exhibit 0 of Herre Bros.' Answer to Motion to Compel), counsel for Keller corresponded to counsel for Herre Bros. pertaining to another proposal for settling the matter. Counsel for Herre Bros. responded on January 22. 1998. (Exhibit E of Herre Bros. Answer to Motion to Compel). Once again, this shows ongoing negotiations between the parties, as late as January 1998. Herre Bros. manifested its intentions to Keller not to be bound until the completion of a signed document. Mr. Grimm's clear statementS to that effect, the exchanges between counsel and the subsequent negotiations prove that the parties had not agreed to all tenns of the agreement and, therefore, no settlement could have occurred prior to the execution of the agreement. B. TIME IS A MATERIAL REQUIREMENT OF EVERY CONTRACf, The element of time is essential to every contract. Where time is not mentioned in the contract, the Court will imply the element of time. Where there is no expressed provision in the contract as to its duration, the intention of the parties in that regard is to be deccnnined from the .7. surrounding circumstances by the application of reasonable construction to the agreement as a whole. Gloeckner v, Baldwin Township 5ch Dist" 405 Pa. 197,201, 175 A.2d 73.76 (1961); Thomas v, Thomas F1exibile Couplinl1 Co., 353 Pa. 591, 597, 46 A.2d 212, 215 (1946); Keystone Bank v, Nuclear Mallnetic Resonance Specialties. Inc" 243 Pa. Super. 471,477,366 A.2d 251. 253 (1976). Herre Bros. has only raised, in the course of negotiating this contract, a material element required in every contract. Amazingly, counsel for Keller resists including a contractual term required by law. Keller cannot avoid the element of time. The element of time will have to be addressed at some point, to the extent that Keller does not meet its contractual obligations of paying Herre Bros. $10,000 under the terms of the agreement. With the possibility of future coun intervention on a settlement agreement, one of the goals of settlement is defeated. The two major goals of senlement are that (1) senlement expedites transfer of money into the hands of the complainant; and (2) senlement reduces the burden and expense imposed upon the courtS. Sociedad Co~n:ializadora v. Ouizada' 434 Pa. Super. 48, 641 A.2d 1193 (1993). The goals of senlement are not accomplished by enforcing this settlement agreement. Due to the lack of a time element, this senlement agreement is subject to further litigation. .8. in Gloeckner, ~. a school district condemned certain lands and plaintiff proceeded to make a claim for condemnation proceeds pursuant to an agreement silent on the duration of the contract. The Court had to engage in a detailed analysis of the facts before concluding that plaintiff was not diligent in performing his contractual obligations, and the intent of the parties was that the contract should not last \1 years. .ll1. at 202, 175 A.2d at 76. In Thomas, sllpra., the plaintiff sought enforcement of a 1920 contract in 1939. The 1920 contract was silent as to the duration of the contract, and the Court was faced with further litigation as to whether the 1920 contract remained in force in 1939. .ll1. at 500-501, 46 A.2d at 215. These cases show that contracts, silent as to their duration, are ripe for further litigation. That litigation will focus, first, on the intention of the parties. As this proceeding shows, there was no agreement on time because Keller refuses to even discuss it. It will be up to the Court to determine the contract's duration. The cmw will have to intervene and one of the goals underlying the preference for settlement would be thoroughly defeated. Herre Bros., under the law, does not havc to let this contract last potentially into perpetuity as Keller would have it. The court should not give legal support to negotiations which are known to be 1ep1ly insuffICient. Evcn if the Court chooses to force a settlement. it should only permit a complete contraCt which includes the element of time. 18 months is a reasonable time for completion of Keller's contraCtual duties. .9- settlement had been reached on November 26. 1997. The terms were specified in the letter to Herre Bros. counsel and confirmed by ils counsel. While Herre Bros. had included time limitations on the payments based on future jobs in prior negotiations. that term was dropped when Keller agreed to increase the amount of the lotal settlement to $7,000 (to be paid before the end of 1997) and $10.000 when he received at least five (5) jobs of $50,000 or more. As Mr. Keller eltpressed to Mr. Grimm, there could be no increase in the amount to be paid without some assurance that there would be sufficient jobs to gener.lte income to pay the additional sums. As a result, the parties agreed to settle the matter on the terms set fonh in Elthibit "C". Not only did the principals agree to those lerms, but counsel for Keller requested that counsel for Herre Bros. confirm that those were the terms of the settlement that had been reached by the parties. In his letter, attached as Elthibit "C", counsel for Keller confirmed that the principals had "settled" the matter and set fonh the terms of the settlement. He did not indicate that the had discussed settlement or that it was a proposed settlement or that it was contingent on any matter. Mr. Keller had advised that the matter had been settled upon those terms and his counsel's letter to counsel for Herre Bros. made that same straightforward statement. In a reply letter from counsel for Herre Bros., he confirmed that the had contacted Herre Bros. penaining the settlement and confirmed that those terms were "cornet" with the comment that the $2.000 was a minimum amount that was required on each such purchase order and that more could be paid if Keller so desired. See Elthibit "D". 4 It was clear that the parties had agreed to settlement and that the terms of this settlement had been confirmed in correspondence between counsel. Only after that did counsel for Kellcr draft a Settlement Agreement and Release and forward it to Keller to counsel for Herre Bros. for review of the language of the document. not the terms of settlement. Ten (10) days later. counsel for Herre Bros. "suggested" several revisions to the Selllement Agreement and Release that did not affect the terms of the settlement but also "suggested" one additional term that materially affected the terms of the settlement. In paragraph number 3 of his leller dated December 18, 1997, (Exhibit "F'), counsel for Herre Bros. suggests that if the $10,000 due from the five (5) jobs of $50,000 or more had not been paid within 18 months of the date of the agreement, that the remainder would be required to be paid at that time. This was not a term of the settlement. The whole concept behind the additional $10,000 was predicated on Keller receiving purchase orders of five of (5) jobs of $50.000 or more. To require him to pay the $10,000 even ifhe received no jobs within the 18 months, substantially changed the terms of the selllement. Accordingly, counsel for Keller was agreeable to making the non-substantial changes to the Settlement Agreement and Release but not adding the new 18 month time limitation "suggested" by counsel for Herre Bros. The parties intended that a settlement had been reached and that the terms of settlement were as set forth in the letter from counsel for Keller (Ellhibit ''C'') as confirmed by counsel the letter from counsel for Herre Bros. (E.'4.hibit "0"). Those exact terms were incmporated into the Settlement Agreement and Release signed by Keller and sent to Herre Bros. and accompanied with the appropriate check. All the material terms of the bargain 5 , Procedural and Factual Historv On October 2, 1991, plainliff Victor Diggs suffered severe injuries when he inhaled a concrete sealant sprayed by M & J Painting & Wallcovering employees working in the basement of a new addition to the Holy Spirit HospilaL Plaintiff had been installing a medical records dumbwaiter for his employer General Elevator Company at the time, On January 5, 1993, plaintiffs tiled a Complaint against M & J Painting and ChemRex. The defendants subsequently joined Federal International ChemicalsIValspar Corporation and Lord Corporation (both manufacturers), J.C, Budding (distributor), Ritter Brothers (general contractor), and Holy Spirit Hospital. All parties have setlled except ChemRex, the distributor of the sealant. Pursuant to the Ritler Brothers' 1995 settlement with plaintiffs, for $250,000, plaintiffs agreed to indemnify Ritter Brothers for both its and Holy Spirit Hospital's legal expenses (which Ritler Brothers was contractually obligated to pay) from any recovery plaintiffs would obtain from ChemRex. At issue is the alleged settlement betWeen plaintiffs and ChemRex. In November 1996, Victor Diggs gave his attorney Archie Diveglia verbal authority to Settle with ChemRex for $75.000, ChemRex counter-offered $7,500. In a December 16, 1996 letter, Diveg1ia forwarded authorization forms to plaintiff seeking authority to settle for S IS, 000, Plaintiff did not respond, On December 31, \996, Diveg1ia alerted plaintiff that he planned to withdraw as counsel. and if plaintiff failed to find another attorney, Diveglia would seek court approval to withdraw by February I, \997, A few days later, plaintiffappcared in Diveg1ia's office and told him he would accept $15,000, with th. understanding it would be split equally between him, his ex.wife Ms. Brooks and Diveg1iI. Neither plaintiff wu aware that under the Ritter Brothers Settlement " - agreement, their S5.000 recovery would be applied to Ritter Brolhers' obligation on its and Holy Spirit's legal expenses. which were over $90.000, Diveglia obtained Ms, Brooks' approval to settle and received further confirmation from plaintiff. Plaintiff denies he gave Diveglia authority to settle, Diveglia contacted ChemRex' counsel Donald Carlson, on either January 16 or 17, 1997. who verbally agreed to settle for SI5.0oo, Carlson faxed a letter to Diveglia on January 17 confirming sectlement. which slated in pertinent part: Just a short nOle confinning that all claims against ChemRex and its insurer as well as any other possible party have now been settled with ChemRex paying SI5.ooo,00. The settlement includes an agreement that the plaintiffs will not disclose the fact that they received any money from ChemRex or its insurer, My recollection is that this was a worker's compensation claim as well, so to the elCCent that there may be any possible subrogated claims. they are being released as well. Diveglia prepared a general release for plainliff's signature that same day, however, plaintiff failed to show, Also on January 17, eilher Carlson or co-counsel Donald Lewis told Diveglia ChemRex wished to review the release language prior to plaintiff's signing it On Monday January 20. Diveglia faxed the draft release to ChemRex. PlaintitTwas scheduled to sign the release on January 20 but failed to appe3t' once again, Sometime during the week of January 20, Diveglia infonned CO-COUllSf'! Lewis ot' plaintiff's failure to appe3T and warned him the settlement was in trouble, In response Carlson fa.'(ed Diveglia a letter on January 28 stating in pertinent part: Enclosed are our proposed changes to the draft release Assuming that the changes are acceptable. please have your client sign the release as soon as possible. The settlement check has been requested from the carrier, When we last spoke. you expressed concern tNt you had lost contact with Digs Ho~, we will continue to proceed on the assumption tNt the case ) ; has been settled on the terms previously agreed to by Diggs. unless and until we hear otherwise from you, After receivin~ this letter Diveglia contacted Lewis and informed him Plaintiff did not wish to settle, On February 5. Diveglia tiled his petition to withdraw as counsel. Nevertheless. on February I~. 1997, ChemRex forwarded a 515.000 settlement check to Diveglia which he returned, Lellal Discussion Initially, we note there exists a strong judicial policy in favor of voluntary senlement of lawsuits. primarily to expedite transference of money into the complainant's hands and also. secondarily, to reduce the expense and burden on the courts, Sociedad Cornmercializadora v, Ouizada, ~34 Pa. Super, ~8, 641 A2d 1193. 1197 (1993), The enforceability of settlement agreements is determined awlrding to contract law principles Centurv 1M. toe v Centurv 1M Realtv. toe, 358 Pa. Super. 5~. 516 A2d 765,767 (1986), A settlement will be enforced if an the material terms of the bargain are agreed upon. McDonnell v, Ford ~lotor Comoanv, ~3~ Pa. Super, ~39, 643 A2d 1102, 1105 (1994). GWI~, 539 Pa. 679, 652 A2d \32~ (1994) ChemRe.'( argues the parties agreed to settle the action on Iarwary 17, 1997, the terms of which were oMdenced by the letter ChemRex fa.'(ed to Divegli.a that day, We agree, The Iarwary 17. 19971ener indicated the parties agreed that in consideration for 515,000, the plaintiffs would release ChemRex and assure ChemRex there was no ouutanding wocker's compensation lien. Plaintiffll1UCS he did not 3Uthorize his attorney to settle for $15.000 The law is dear that an attorney lTI.ISt have his or her client's express authority to enter into a settlement agreement, Rothman v FiUette. SOJ PI. 259, 469 A.:d 54J. 54S (I98J) However, the credible evidence established ~ plaintiff gave his anomey authority to settle for S 15,000, Plaintiff also argues that even if he gave his consent, the settlement should be set aside since he and his e."C-wife each expected to receive 55,000 and were not informed of Ritter Brothers' indemnification rights to that money, Under the law, if it is c1wly shown a settlement was obtained through fraud. duress or mutual mistake, it can be set aside, McDoMell, 643 A.:!d at 1106, Plaintiff suggests there was mutual mistake, We disagree. While the plaintiffs might have been mistaken. the mistake was not mutual with ChemRex. and in fact. whether the plaintiffs could pocket the money or not was a completely irrelevant consideration to ChemRe:< and cenainly not material to their decision to settle, Diveglia separately argues the January 17, 1997 agreement to settle was not enforceable since a signed release was a condition precedent to completion of the deal, Thus, plaintiff's withdrawal of his offer prior to the release ha\ing been signed. ob'liated settlement. He notes it is black letter law that "where the parties have agreed on a settlement which is to be put in writing and signed. there is no binding agreement until it is signed," 15A C.IS, Compromise and Settlement 9 IS, The coronary to this principle. he argues. is no agreement is reached if a pany withdraws prior to signature. Funhermore, Divcglia notes it is insurance industry practice that a settlement agreement be reduced to a written release until any consideration is paid. Thus. a signed written release is I material and essential element of a settlement agreement. l'nder Pennsytvania llw"if the parties orally agree to all the tenn5 of a contract between them and mutually expect the imminent drafting of a written conma redecting their ~ ua1entanding. the oral cOun act may be enfcrc:able." K mniian v New Enjland Petroleum C ot'DOI'2tion. 33 2 h Super. 1. 480 A.2d 11S3, (1984) (ciwion omitted) [n that case. the Superior Court held an oral 5 , agreement to senle was binding even though. among other items, releases had not been reduced to writing. In support, the court quoted the Third Circuit as follows: The senlement agreement which was entered into by duly authorized counsel expressed the intention to senle the case for the agreed amount and was valid and binding despite the absence of any writing or formality, The tender of a release did not reopen the agreement or make its execution a condition to the settlement itself. [cications omitted] Kmlliian, 480 A2d at 1157.8 (quoting Good v. Pennsvlvania Railroad Co, 384 F.2d 989,990 (jrd Cir, 1967)(emphasis added)). ~~, Kazaniian at 1157.8 citing Woodbridge v Hall, 366 Pa. 46, 76 A2d 205 (1950) (oral settlement agreement enforced even though parties were unable to reduce it to writing) and Gross v Penn ~fUlUal life Insurance Comoanv, 396 F.Supp, 373 (1975) (oral senlement agreement enforced where one of parties attempted to disavow senlement a few days after oral agJ cement but before it was reduced to writing), In addition, "'[i]f parties agree upon essentialtern1S and intend them to be binding. '& contract is formed even though they intend to adopt a formal document lAoith additional tern1S at a later date. ' The intent of the parties is & question of fact which must be determined by the facttinder," McDonnell. 643 A2d at II0S-6 (quoting Johnston v 1ohnsto!!. 346 Pa. Super, 427, 499 A.2d 1074, 1076 (1985)). The parties' intent was to settle the case for $15,000 on either 1anuary 16 or 17. 1997, the terms of which were evidenced in the 1anuary 17, 1997 letter from Carlson to Diveglia. At the hearing. Me, Diveglia agreed "that $15,000 senled Me and ~lrs. Diggs' case against ChcmRex. period." Diveg1ia also argues ChemRClC' attempt to malce material changes to the release language indicates a meeting of the minds did not occur and in fact constituted a counter-ot1"cr, He argues the language ChemRClC proposed wu material in that it limdamentally alfected immediate distribution of the settlement proceeds to p1ainritTs. We disagree. The release language proposed wu not material to 6 ~ , \ W,OOD ALLEN .. RAHAL, UP . ..0-....,,_ 1'.0.".1_ WL. _ 11 MtQ. M 1,....1... ..;; -.", ,,_: " - . . -- . . , ... V. I IN THE COURT OF COMMON PLEAS OF I CUMBERLAND COUNTY, PENNSYLVANIA I I I NO. 97-3987 CIVIL TERM I HERRE BROTHERS, INC. GEORGE A. KELLER t/d/b/a KELLER ENGINEERING SERVICES . . I ORDER OF COURT AND NOW, this dt~~ day of FEBRUARY, 1998, upon consideration of the foregoing Motion to Compel Settlement, IT IS ORDERED AND DIRECTED AS FOLLOWSI (1) A Rule is issued against respondent, Herre Bros., Inc., to show cause why the Motion to Compel Settlement should not be granted. (2) Respondent shall file an answer to the petition within fifteen (15) days of service. (3) The petition shall be decided under Pa. Rule of Civil Procedure 206.7. (4) Any depositions shall be completed within thirty-five (35) days of service. (5) Briefs shall be filed in chambers and argument shall be held on Friday. MaY 8. 1998. at 9100 .... in Courtroom' 5 of the Cumberland County Courthouse, Carlisle, Pa. (6) Notice of the entry of this order along with a copy of the Motion shall be provided to all parties by petitioner. By the court~ Steven I. Grubb, Esquire For the Plaintiff Stephen L. Grose, Esquire For the Defendant ~... ....~..e..t -"lh/Ilf.,' ...\.... ~/;J ;:. .~.-~ -.... Edward E. Guido, Judge "4 ,. ~ " school district's acceptance of Herre Bros.' bid, Keller reneged on its bid. Herre Bros. had to retain another contractor to perform the work Keller had promised to perform at a lower price. This resulted in a rmancialloss to Herre Bros. 3. Denied. The allegations of the Complaint speak for themselves. A summary of the Complaint is contained in answer to paragraph 2, above, which is incorporated by reference. 4. It is admitted that the pleadings were closed, discovery initiated and the issue of settlement raised in early November, 1997. Keller's characterization of the November 11. 1997 letter (Exhibit A of Keller's Motion) is denied as the letter speaks for itself. The letter attached as Exhibit A to Defendant's Motion is an unsigned letter, different in appearance than the letter received by undenigned counsel. Therefore, it is denied that the attached letter to Defendant's Motion is W. trUe and correct copy of the letter,. although the contents of the letter appear similar. S. It is admitted that the letter attached to Keller's Motion as Exhibit B is a trUe and correct copy of Herre Bros.' November 14, 1997, correspondence. The remaining allegations are denied IS the letter speaks for itself. The November 14, 1997 letter was. not intended to be a counteroffer, but rather an initial offer proposed to Keller. Herre Bros. did not consider Keller's initial SS,OOO offer to be a legitimate settlement offer by Keller. It is worthy to note that in the 2 . .. ,. ~ November 14 letter. it was made clear that any installment payments were to have been concluded by the end of 1998. 6. It is admitted, upon information, that on November 26, 1997, George Keller called Ed Grimm, Senior Vice President of Herre Bros., to discuss settlement. It is denied that there were "several calls. which resulted in a discussion of settlement. It is denied that "[n}o time limitation relative to the payment of the fmal $10,000 was considered with the final offer, nor agreed to by the parties." As stated in the Affidavit of Edward Grimm, attached hereto as Exhibit A, during the course of settlement discussions between Messrs. Grimm and Keller, Mr. Grimm made it clear to Mr. Keller that any settlement had to be completed by the end of 1998. This was a threshold discussion which Mr. Grimm had assumed was an undentanding which was included in all subsequent settlement discussions. Herre Bros. extended the time for completion of Keller's performance to 18 months at a later time, IS a point of compromise. It is admitted that during the settelement negotiations. it was discussed and decided that Keller would pay Herre Bros. $7,000 by December 31, 1997, and that Keller .....ould pay at least $2,000 to Herre Bros. on each of the next five (S) bids awarded by Herre Bros. to Keller of SSO,OOO or more. 3 I ,.. It is denied that this was the extent of the settlement discussions. It was also understood by the two panles that there would be no settlement without a written Settlement Agreement and Release being executed by the two parties. See Grimm Affidavit, Ex. A. Mr. Keller even volunteered to have his attorney create the initial draft of the Settlement Agreement and Release. 7. Denied. It is denied that Mr. Grimm indicated that he was accepting the terms discussed by Mssrs. Grimm and Keller solely because Mr. Grimm wanted to get this matter behind him. Rather, IS counsel for Mr. Keller stated in his November 11, 1997 letter (Exhibit A to the Motion), the two parties had Mpresent and future business relationships" between them and wished to continue these business relationships under good terms. Therefore, it was advantageous for both parties, as OOJinrcs' in the community, to settle the matter before any "time, money and good will" were expended in litigating the case. Mr. Keller wanted to settle the case and "&et the matter behind him" just as much as Mr. Grimm did. The settlement lDS made contingent upon execution of a written agreement. Mr. Keller volunteered his attorney to prepare the initial draft, based on the preliminary negotiations and understandinas reached by the parties which were to be pan of the Settlement Agreement and Release. M stated by Mr. Grimm in his Affidavit attached hereto IS Exhibit" A", Herre Bros. did DOt intend for . sett\ement to exist without the presence of . written Settlement Aateement and 4 .. believed he had made as much clear to Mr. Keller during the course of settlement negotiations. Additionally, counsel for Keller has admitted in his letter of December 1, 1997, attached to Defendant's Motion as Exhibit C, that "I will then draft an appropriate settlement agreement and release. .llpgn execution gf.!hat, we can have payment made by my client and have this action marked settled and discontinued with prejudice." Any settlement required the execution of Man appropriate settlement agreement and release. M 8. After reasonable investigation, Herre Bros. is without knowledge or information sufficient to form a belief as to whether "Keller advised his counsel to prepare the settlement agreement but counsel for Keller advised they should confirm the terms of settlement with counsel for Herre Bros. flr5t, which was done in a letter dated December 1,1997." Therefore, these allegations are denied. It is also denied that the letter attached as Exhibit C is a "trUe and correct copy" of the letter which was sent to counsel for Herre Bros. as it is unsigned and not similar in appearance to the letter which was received by counsel for Herre Bros. It appears that the substance of the letter is the same as that which was received by Herre Bros. It should also be noted that in the December 1, 1997 letter it is Slated by counsel for Keller that he will "draft an appropriate settlement agreement and release. Upon execution or that, we can have payment made by my s ... client and have this action marked settled and discontinued with prejudice." Counsel for Keller has acknowledged that the settlement of this matter was contingent upon an executed Settlement Agreement. 9. Denied. Counsel for Keller's self-serving analysis of his own letter sent on December 1, 1997, is denied, as the letter speaks for itself. The fact that counsel for Keller stated in that letter that the principals "had 'settled' the above matter" does not in any way reflect an agreement on the part of Herre Bros. with that statement. Herre Bros. believed that no settlement existed until a Settlement Agreement and Release had been executed. Additionally, counsel for Keller's gratuitous, self-serving description of the second paragraph of his letter as a "procedure" is denied. Herre Bros. understood the second paragraph as a reqJlirement to settlement. 10. Denied. Keller's self-serving analysis of the December 4, 1997 letter from counsel for Herre Bros. is denied as the letter speaks for itself. A ponion of the letter, which Keller ignores, states that Herre Bros. "would be willing to grant a release to your client and I will have the action marked settled and discontinued, with prejudice, upon your client's payment of the initial $7,000 and my ~inll provided with an executed copy of the Settlement Alreemenl and Release. I will look forward to your promptly providing me with the draft of the Settlement Agreement and Release." This shows that from the initial communication from counsel for Herre Bros. there was the necessity of a Settlement Agreement. 6 .... It is admitted that the December 1, 1997, attached as Exhibit MD" to the Motion, is a trUe and correct copy, but the letter is hardly a confirmation of settlement. The December 4, 1997 letter does not state, nor was it intended to state, that agreement had been reached on every point of settlement. As described above, it is made clear in that letter that any settlement or release would be contingent on an executed copy of the Settlement Agreement and Release which counsel for the parties would draft. 11. Denied. It is flr5t denied that Herre Bros. settled the case or that the terms thereof had been conf1I1I1ed in a writing by counsel for Herre Bros. We incorporate our answers to paragraphs 6-10 above in support of a lack of a settlement, a lack of agreement on the terms and a lack of confumation of the terms, in writing, by counsel for Herre Bros. The remaining allegations of paragraph 11 are also denied. Mr. Grimm did not agree to terms of settlement, but only agreed to certain points with Mr. Keller, Settlement was not to have occurred until a signed Settlement Agreement and Release, prepared by the attorneys, had been executed by the parties. It is furthermore denied that a trUe and correct copy of the cover letter and initial draft of the Settlement Agreement and Release are attached as Exhibit E, as what appears IS Exhibit B is an unsigned copy of a letter which does not resemble that which was received by counsel for Herre Bros., although the contents of Exhibit E appear to be that which was conveyed under cover of December 8, 1997. 7 ... It should also be noted that accompanying the December 8, 1997 cover letter was a "proposed settlement agreement and release." By its mere title, this draft contemplated an exchange between counsel for the parties. This is not unusual, considering that Messrs. Grimm and Keller had agreed to certain points without the aid of their attorneys, but neither were hardly in a position to draft a legal document or agree to.all terms required in a settlement agreement. S= Grimm Affidavit, Ex. A. It should also be noted that no money was to change hands, nor could terms of the negotiation be enforced until there was a signed Release and a signed copy of the Settlement Agreement. 12. Denied. Counsel for Keller's self-serving and subjective analysis of the document sent by counsel for Herre Bros. on Dtcember 18, 1997 is denied in its entirety. As can be seen from Exhibit F, admittedly a true and correct copy, there were several changes which were mentioned in the December 18, 1997lener. Counsel for Keller improperly takes it upon himself tl.llabel them "material" and "minor." In fact, counsel for Keller agreed to and incorporated three of the four suUested changes, which he conveniently labels "minor." The time limitation is labeled "material" by counsel for Keller, however, it is no more or less important than the other terms mentioned in the December 19 letter which were subsequently incorporated into the draft agreement without prior discussion by Messrs. Grimm and Keller. The exchanges by counsel were the "give and take" of settlement negotiations, not "refinements." Counsel for Keller I ... accepted those terms which were agreeable to his client and rejected those which were unagreeable. No settlement had been reached at this point. It is furthermore denied that a time limitation of IS months had not been discussed by the parties on November 26, 1997. As stated in the Affidavit of Edward Grimm attached hereto, and confirmed at paragraph 7 of George Keller's Affidavit, attached hereto as Exhibit B, the time limitation had been discussed, and Mr. Grimm perceived that it had been agreed upon by Mr. Keller. The IS-month time limitation was a reasonable time offered by Herre Bros., although, originally, Mr. Grimm had requested that both parties complete the payment by December, 1995. It is furthermore denied that any of the correspondence between counsel for Keller and Herre Bros. was "confuming the terms of settlement reached between the panics." The correspondence exchanged between counsel for Herre Bros. and Keller only reflected the preliminary negotiations between the parties and did not reflect agreement on each and every portion of the Settlement Agreement, as evidenced by the changes requested by Herre Bros. which were subsequently incorporated by counsel for Keller into the draft settlement agreement. 13. Denied as stated. Counsel for Keller called counsel for Herre Bros. and advised that he believed the IS month time limitation was not a term of the settlement which should be included in the Settlement Agreement and Release. Counsel for Herre Bros. stated to counsel for 9 .. Keller that a time limitation would have to be included in any settlement. The settlement was still in its negotiating phase. No actual settlement has been consummated. It is admitted that the letter attached as Exhibit G to the Motion is a true and correct copy of counsel for Herre Bros. ' letter. The letter speaks for itself. Counsel for Keller's subjective and self-serving interpretation of the letter is denied. 14. Counsel for Keller's subjective and self-serving analysis of the December 26, 1997 letter is denied, as the letter speaks for itself. The existence of a discussion pertaining to a time limitation being discussecl by Messrs. Grimm and Keller may not be included in the December 26, 1997 letter, but it is included in a letter from counsel for Herre Bros. to counsel for Keller dated December 31, 1997, a copy of which is attached hereto as Exhibit C, which counsel for Keller failed to disclose in his Motion. Mr. Grimm also states in his Affidavit (Ex. A hereto) that in subsequent conversations with Mr. Keller, Mr. Keller even acknowledged discussion of the time limitation, but the reason Mr. Keller would not include a time limitation was based strictly on the advice of his attorney, and not based on any of the discussions between the parties. In any event, as discussed in preceding responsive paragraphs. settlement was always contingent upon an executed copy of a Settlement Agreement and Release acceptable to both parties. It was never the intention of either party to have a settlement or the case without a document which was to be drafted by the attorneys. 10 ... By way of further reply, where no time element is placed in a contract, the law implies that performance of the contract must be completed within a reasonable period of time, based on the intentions of the contracting parties. Gloeckner v Baldwin T\\1) Sch Disl., 40S Pa. 197,201, 175 A.2d 73,76 (1961); Kt:)'slone Bank v. Nuclear Mallnetic Resonance Specialties. Inc., 243 Pa. Super, 471, 477, 366 A.2d 251, 253 (1976). Therefore, since time is an essential element to every contract, it was not unusual for time to be discussed between attorneys and in the course of negotiating a settlement document. Counsel for Keller refused to even discuss the legal requirement of time and knowingly attempts to enforce an agreement which does not contain an essential term. IS. It is admitted that "counsel for Keller revised the Settlement Agreement and Release", thereby acknowledging that the two parties were still negotiating substantive terms of the Agreement. Counsel for Keller's subjective and self-serving classification of the changes as . minor refmements" is improper. We incorporate our answer to paragraph 12 by reference. It is admitted that Mr. Keller signed the document attached as Exhibit H and that his attorney delivered the document with a certified check in the amount of $7,000 to counsel for Herre Bros. It is denied that the document which was received by counsel for Herre Bros. was a final copy of the Settlement Agreement and Release. There was no Settlement Agreement agreeable to Herre Bros. Once again, counsel for Keller has attached as Exhibit H an unsigned 11 .. document which is not the "trUe and correct copy" of the letter received by counsel for Herre Bros., although the substance of the letter appears to be similar to the one received by counsel for Herre Bros. By way of further reply, counsel for Keller sent the document to Herre Bros. attached to Defendant's Motion as Exhibit H, knowing that Herre Bros.' position was that no settlement had been reached. 16. It is admitted that counsel for Herre Bros. returned the draft of the Settlement Agreement and Release and the check since no settlement had been reached at that time. It is denied, however, that counsel for Herre Bros. "refused to honor the settlement, now contending that no settlement had been reached." Counsel for Keller sent over the document and certified check knowing Herre Bros. had not agreed to terms of settlement. This was not something that counsel for Keller only then became aware of, but was something of which he had been advised on numerous occasions for about one full month. In his Motion, counsel for Keller ignores the subsequent negotiations which occurred between the parties. Following the return of the $7,000 certified check and the document Keller claims to be the final Settlement Agreement and Release, Exhibit H of Keller's Motion, discussions resumed on the settlement. Counsel for Keller next sent a letter dated January 9, 12 , 1998, is attached hereto as Exhibit D and incorporated by reference. In that letter , counsel for Keller submitted yet another ~ettlement counterproposal. The subsequent proposal was rejected by Herre Bros. through correspondence dated January 22, 1998, attached hereto as Exhibit E and incorporated by reference. As Mr. Grimm states in his Affidavit, Ex. A hereto, Keller's subsequent proposal was overly complicated. But as another point of concession and compromise, it its January 22, 1998 letter, Herre Bros. proposed to extend the time for payment to 2 years. Counsel for Keller responded with this Motion. While the January 9, 1998 letter claims to reserve Keller's position of a completed settlement, Herre Bros.' January 22, 1998 letter made it clear to Keller that it considered the January 9 letter to be yet another round in the ongoing settlement ta11cs between the two parties, as had all previous correspondence. 17. The allegations of paragraph 17 are legal conclusions to which no response is ~5salY. It is denied that material terms of a bargain were agreed upon in this instance. In fact. the parties had not agreed upon the material element of time. Counsel for Keller refused to even address the material element of time in negotiations. It is furthennore denied that the cases cited by counsel for Keller are applicable to this case. J3 . IS. The allegations of paragraph IS contain a legal conclusion to which no response is required. By way of further an~wer, the cases cited by Keller in support of this proposition are distinguishable on their facts and inapplicable to the present situation. While it may be a general legal proposition that "there is a long standing public policy that encourages settlements", enforcing preliminary negotiations in this matter will not serve the public purpose of settlement. Since time is an essential element in all contracts, to the extent Keller fails to perform its contractual obligations within a reasonable time, the Court will be called uponjp impose a time limitation. Thomas v. Thomas Flex COIlpline Co., 3S3 Pa. S91, S97, 46 A.2d 212, 21S (1946). Therefore, there would be no finality to an enforcement of these negotiations. The Court will not ease its docket or promote amicable resolution of disputes, but will only leave open the possibility of yet another round of litigation. 19. Denied. This is an erroneous legal conclusion to which no response is necessary. It is, furthermore, not reflective of the facts in this case. It is blaclt letter Pennsylvania law that if both parties contemplate that a signed Settlement Agreement and Release is part of the contractual agreement between the two, there can be no settlement in the absence of the signed writing. Essner v. Shoemaker 393 Pa. 422, 42S, 143 A.2d 364, 366 (l9SS); Schulman v J.P. MO(Jan Inv. Mallllr~nl. Inc., 35 F.3d 799 (3d Cir. 1994). In this case, Messrs. Grimm and 14 , Keller reqlli=l a signed Settlement Agreement and Release prior to settlement occurring. .5= Edward Grimm Affidavit, Ex. A hereto. 20. Denied. Not all of the material terms of the bargain had been agreed upon. This is reinforced by counsel for Keller's subsequent, post-November 26 incorporation of terms not discussed by Messrs. Grimm and Keller. S=.abo answers to paragraphs 12 and IS. Counsel for Keller ignores the essential term of time in requesting this Court to enf:>rce settlement negotiations which do not include a material term. WHEREFORE, Plaintiff, Herre Bros., Inc., respectfully requests that this Coon deny Defendant's Motion to Compel Settlement. Furthennore, Keller's request for attorney's fees should be denied. Keller states that "settlement terms were agreed to by the parties on November 26, 1997," and seeks to enforce those terms (See , 20 of Motion), but still makes a demand for attorneys' fees. Attorneys' fees did not enter into the settlement discussions until well after November 26, 1997 (See Exhibit F of Keller's Motion), and were, in fact, a term suggested by Herre Bros. at the same time it brought up the need for a time limitation. Incredibly, Keller seeks to use post-November 26 seulement discussions where they are useful, but chooses to ignore those, such u the time limitation, where they are not advantageous. Keller's selectivity of terms IS 7. During the course of these talks, we spoke about the above-referenced senlement offer and fmancialterms. I always maintained my insistence that any settlcment of the lawsuit be completed by the end of 1998. 8. As a point of compromise, I agreed to extend the time period for when Keller could pay Herre Bros. from the end of 1998 to 18 months after the signing of a formal Settlement Agreement and Release. 9. At all times, I was under the impression and believed that a time limitation of 18 months was a point which would be included in any settlement, and a point of which I understood George Keller to be cognizant. Mr. Keller never objected to the inclusion of the 18 month time limitation in our discussions. 10. After negotiating. Mr. Keller and I, without the involvement of our attorneys. agreed that, monetarily, $7,000 in cash would be paid by Keller before the end of 1997, and $10,000 WIS to be paid in a minimum of $2,000 installments whenever Herre Bros. awarded Keller bids in excess of SSO,OOO. 11. It was my impression that during our discussions pertaining to monewy terms, Mr. Keller was always aware of my insistence that the senlement be completed in 18 months. 3 12, While considerations of time were not always re-hashed by me while discussing monetary terms, this was only because I thought I had initially made clear to Mr. Keller my position on the issue of time. I felt it did not need to be discussed any further. Mr. Keller never objected, nor did he ever bring up the issue of time after my initial contact with him. 13. At all times during my discussions with Mr. Keller, it was always my intention that a Settlement Agreement and Release needed to be signed by both of us, prior to a settlement being consummated. I believed this to be the intention of Mr. Keller as well. Since Mr. Keller and I were not attorneys, yet did part of the negotiating, we did not feel we could address all matten that needed to be included in a valid Settlement Agreement and Release. There was never any discussion of oral settlement agreements. but rather, there always had to be a written Settlement Agreement. prepared by our attorneys and signed by both of us which would bind both of us. 14. After my discussions with Mr. Keller, I informed my counsel of the general monetary terms of the agreement, and furthermore informed him that he should expect a draft of a Settlement Agreement and Release from the attorney for Mr. Keller. 15. At some point after December 1, 1997, I wu informed by my attorneys of a communication from counsel for Keller. I concurred that the monetary terms contained in that 4 communication were correct, with the added provision that Mr. Keller could pay Herre Bros. greater than $2,000 per installment, if he so desired. 16. I still, at this time. considered that a time limitation would be contained in a Settlement Agreement, prepared by the attorneys, which I understood to be forthcoming and which needed to be signed prior to Herre Bros. and Keller being bound by the terms of the settlement, pursuant to my and Mr. Keller's conversations. 17. I also believed that counsel for KelIer's letter only pertained to !be monetary aspects of the settlement, and that no settlement would be completed until a signed Settlement Agreement and Release had been consummated. Additionally, I expected to see a time limitation, which Mr. Keller and I had previously discussed, contained in the forthcoming Settlement Agreement and Release. IS. At some point after December S, 1991,1 received a copy of the proposed Settlement Agreement and Release, provided by counsel for Keller. This document is attached hereto as Exhibit B. I noticed that no time limitation was included in the Settlement Agreement, therefore I requested the inclusion of an lS-month time limitation. I also concurred with my attorneys that a default provision should be included in the Agreement and that the initial payment should be in the form of a cenified check. I also wanted to be sure that Keller understood that no future s . "F ...."".c.._ .....-,":":'"... , .l~ @- ,~.>: "'9;1 _--0_ . . - A_ .,- SETT~E.-~ A.GRE~ A.:.'JD RELE..3.SE Th~s Set:lement Agre~~ent ~~d Release is exec~:ec t~~S cay of Decer.~er. 1997. between Herre Brcs.. Inc. w~:h its ~r~nci~al place of bus~ness locatec at 4417 Valley ~oac. ~~ola. c~erlanc county. Pe~~sylvania (here~na:ter "Herre aros.") anc Geor;e A. Keller. t/c/b/a. Keller ~~g~neer~ng Se~.~ces. w~th its ~rincipal place of bus~ness at 173 Park Street. Log~~ville. York County. Per_~sylv~~~a (hereinafter 'Keller"). WE~~S. on or about April 16. 1997. Herre Bros. was preparing to su=mit a bie to provice se~rices to t~e Sr;ewsbur~1 S~hool Dis::ict; a~d, W"r~~S. Keller s~mitted a proposal in reg arc to provid~ng certAin e~~~~ent to Herre Bros. ("?rcposal"); ~c. W"~~R!AS. d~sagre~~ents arose as to whet~er or not the ?ropcsa: was.~it~cr7'~.bY ~e~le7 ,or hac b~en ~roperlY r~li;c.uPor. ~.~~. 3ros~ ~~ Sub~:Cl~; ~ts b~Q, :es~lc~~; ~n a la~s~~: ~e~~; ~il.d wi:~ t~e caption He~~e B~os.. Inc. v. Geo~ee A. K~11a~, / . I ".... - C'1""'AO....:'"'" rv; s. ....,:., ...~ C Nt. . e- i- Q 7, in the Court 0: Common plea of Cumberl~~c Co~~ty ("Lawsu~t"); cd. WF~R!AS. the oarties wish to resolve all matters relat~nq to the Proposal anc t~e Lawsuit. NOW T~~~:ORE. the oarties heret~, with t~e intent to be :e.ally bounc ~~c for the consicerat~or. set forth below. agree as ~ollows: 1. In exchan.e for Herre Bros. providing a release to any cd all cla~~ rela:ive to any matters relating to ~~e Proposal or the Lawsuit. as set forth below. Keller will provide a check r.~de payable :0 "Herre 3ros.. Inc.," in the amo~~t of 57.000. on or before Dec~~er 31, 1997. In addition, Keller will pay $2.000 to Merre Bros, on each of the next five purchase orders of 550,000 or more that are awarcec by Herre Bros. to Keller, This will a~regate to an additional 510,000 being paid by Keller to Her=e Bros.. provicing the purchase orders are issued. If Keller vi shes to ~ay more t~~~ 52.000 for a particular purchase o::er. he may do so. The $2.000 is a minimum pay:en:. with any f..::.c!s ~aid in addieion to t~~: ~~~~t beinq applied to the toeal 5:'0. 000 pal('ll\e.~t. 2. Herre Bros.. Inc.. its assiqns and successors. s~sidiari.s and agents. hereby releases and forever discharge Geor;e A. Keller. t/d/b/a Keller Er.qineering Services. and Keller !~ipment Sales. Inc., :~eir respective heirs, successors. Assi~s. of and from any and all ac:ions. causes of ac:icr.s. clA~~, c~es, dL~qes, ex;enses, cons~e~:ial ~~esf O~ ~y o::.~ elai~ 0= de~~c of ~~y natu:e W~A:sceve~. ~~e:~a= ~C~~ C~ '. ~~owr., from the beginning of ti~e to the eate of this release, as relates. directly or indirectly, to the ~roposal or the Lawsuit, 3. Wi:hin ten (10) days 0: receiving an exec~ted copy of h. S 1 . R ~ ... ,.!<:' , t lS ett ement ~greement ar.~ e_ease. L~~ a c_e_. ~n tne amot~~t of $7,000, Herre Bros. will file a praeci~e dismissing the Lawsui:, wi:~ prejudice. L~C pr:vi:e ccunsel for Keller with a time-stamped copy of the same. 4. This Set:lement Agreement ~~d Release contains the entire agreement between the parties. is contractual in nature. and may not be altered, except in writing. signed by all parties. S. It is u=derstood that the sole consideration for this Agre~ent is as set forth above. ~~d that the consideration constitutes a fair ~~d reasonable settlement 0: ~~y ~~d all matters as indicated. 6. I: is ac~owledged that the exec~tion of this Agreem~~t does ::'0: constitute ~~ aC:nission 0: a::v tla::". but is a neqotia:ee sett:em~~t 0: disputed clai;S~ . 7, ~he parties he:eby certify ~~: the te~ of t~~s ~q:ee=~~: have been cocpletely read, a:e f~lly u=de:s:ood, r.ave been reviewed by the respective co~~sel, a::d are vol~~tarily entered into Eo: the purposes of ~i::.g a full 4.~d final compromise as set forth above. 8. To ~~e ex:L~: that any disagreL~en:s arise relative to this Agree=L~t, they will be controlled by the laws of the Con:nonweal:h of ?en.~sylvL~ia. ~ WITStSS Nf~,-~F, the parties set their r~ds and seals t.~e c!ate written above. Attest: He::e 9:05., I~c. By: wiee51 : George A. ~eller, Individually wiee51 : Geer;e A. ~e:ler, t/d/b/a ~eller ~~;ine.rinq Services - ... ElChlblt C @- . -"' ...,.-..-, ",""'-,,,. , , L-_~ , "^ - - ...............- ..-...". The additional payment will DOt be considered part of the purchase order, or in any way be considered by Herre Bros. in deciding whether to award a contract to Keller for which Keller bas placed a bid. Nothing in the Settlement Agreement and Release shall be considered as Herre Bros. giving Keller preferential treaanent in any business dealing in which the twO parties are involved, and Herre Bros. shall in no way be required to give Keller preferential treaanent in the awarding of purchase orders in the future. All dealings between Herre Bros. and Keller have been, and sbal1 hereinafter remain. at arms's length. 3. After Paragraph I. we suggest adding as P3!1gnph 2: Herre Bros. and Keller shall complete the terms described in paragraph 1, above. within eighteen (18) months of the date of this agreement. If Keller bas not tendered the full amount of 510,000.00 in that time. Herre Bros. may immediately call the entire re:naining mount due by nctifying Keller, in writing, that Herre Bros. demands the outstanding balance. Upon receipt of the notice, Keller sbal1 within ten (10) days, deliver the amounts due and owing. 4. After Paragraph 3, we suggest adding as pangraph 4: In the event that Keller defaults in payment of funds due Herre Bros. under this agreement, either by failing to pay any of the 52,000.00 amounts as required under paragraph 1, or by failing to pay the balance within ten (10) days after rec:ipt of notice as required in paragraph 2, the release granted by Herre Bros. and descn"bed above in paragraph 2 shall be deemed null and void and Herre Bros. shall be eatided to pursue any rights and remedies available to it under the law and at equity, including an action for bre3Ch of contract or tlCJligeace, as if no settlement had be:n re3Ched, and Keller waives any right to :wen the statute of limitations as a defense. Herre Bros. sbal1 be eatided to rec:ive from Keller alllUSOnable costs and fees, including attorneys fees, expended by Herre Bros. to enforce the terms of this Azreemellt or to pursue recovery in the event action is brought upon default by Keller. Another sugcstion would be that Keller Sill1 a Note for 510,000 with a confession of judpnellt and payments being accomplished over eigbte= (18) months in the QWIIlICr descn'bed above. This would alleviate the need for much of the language in paragraph" above. exhibit 0 GJ-", ~~ . *' ,,""""" ....c-_ ~-~ .' l1eA TH ~ ALLEN H. CAVlD ...........1.. W'I..LJA,M L ""'1t..!..EIII, ",III. CHAlIlIl..U W. IIIUICNDAI..l.. D lIIIOlERT ~ WEI..OON EUGENE I. ftClli'INSKY, "'... THO....... L weco ,JOIrotN 11. ENOS ID GA"Y C. "U.NCH DONNA I. WII..OON .lIlIAO~IItO OOlllllllANCI ..Ic,.,.lItn S. ITOKES IItO.CJItT lIlI. CHUlIlIClrot STC~EN '- GI'OSe lit. sean .!olEAJIIItIll WAYNe .... ~CHT DON.L,D M. I..CWIS m ."IOGCT ""'. WI1IT1..CY KAlIIlN IJItQT)4C"S ""'AT .",n.m." S. I..T'NCH SIrotAWN W. wEIS KEEFER WOOD ALLEN & RAHAL, LLP 210 WAL.NUT STREET P. O. BOX 11$163 HARRISBURG. PA 1710e-1S163 PHONE (717) 2SS.eOOo "AX (717) 2SS.eOSo lST..I..IIHlO IN 1878 0" COUNSEL. WII..LIA"'" .... WQOD .....UEI.. C. ......"T' welT SMOllll. orr'f;C. .11 '.I..LOW"lII..D lItO.D U..... HILL.. ,.. 17011 IEIN NO_ a3.01Ie'.35 January 9, 1998 '...ONI m1t 8'&'.100 r..... (717)> 81&..aOI ..ITliII!"' O'lIIICT 0'..... 255-8052 Steven E. Grubb, Esquire Goldberq, Katzman' Shipman P.C. 320 Market Street PO Box 1268 Harrisburg PA 17108-1268 Re: Herre Bros., Inc. v. Georqe A. Keller, t/d/b/a Keller Engineering Services Civil Action 97-3987 Court of Common Pleas of CUmberland Countv Dear Steve: R=rFt':t:"~ ".. ~ #10 ~~~g Your position is that there is no settlement in this matter and our position is that there is a settlement as set forth in the Settlement Agreement signed by my client. I provide you with a copy of a recent opinion by Judge Turgeon on this issue for your review, Without prejudice to either of those respective positions, I agreed to address the issue of a time limitation on the payment of the additional $10,000 ($2,000 on each of five (5) jobs) with my client. He has recommended the followinq IS a resolution of the impasse. The additional $10,000 would be paid within a 24 month period, $1,000 on each job for ten (10) jobs ot $25,000 to $50,000, or $2,000 on each job for five (5) jobs in excess ot $50,000, These would be minimum payments tor such jobs, If after 24 months, a total of $10,000 has not been paid, And my client had received six (6) or more jobs ot $25,000 to $50,000 or four (4) or more jobs of more than $50,000, then he would be required to pay the balance of the $10,000. If, however, my client had received five (5) or fewer jobs of $25,000 to $50,000, or thre. (3) or less jobs ot more than $50,000, then he would pay only one-halt ot the balance remaining on the $10,000. An example would be as follows: If my client received, over the next 24 months trom the date of a new settlement aqreement, six (6) jobs over $25,000 but not more than $50,000, he vould have paid $6,000 on the $10,000. After the 24 month period, the balance remaining would be $4.000 and since my client would have Exhibit E (!> ~,. " 1'" '~~~""~~........,;.;..,,,i,; -.""""'~~ ".~ < Ill. "- -.,... .-. .~ ~._l .M. ... ~_c-__ "-c:":';", < '.., , .' ~ LAW OPPICS. GOLDBERG. KATZMAN &: SHIPMAN. P.C. IlONALO Ill. K"TZJrIIAN ......., L GOUlKItO p, \.U. SIoW;....... .....U\. J. (..-carTa ten. MCNCCJtIMOT ... oJ_" COQIIOlI TkC)MAll. IIItHMCJ1 .0.. A. ITA t\.DI """IL. ~ STRANO-_UTA' GUT M. JlItOOKI .:u~DlION ~ "'''IllAH ICAIlOl S. 1'I'U041"tN1PQDll .IPfIITJ.~IO "'('ld,n. J, eJlOctNZI """,,,\.0 .. "'OGIoN T1oIOfrIlAl ..I. wDOl tvAH .a. !Cue. . oICMt on.OCfilZO ST'tVOf C. ~ CIIAH" woooscc ...lQMoIlIl ...o"T 080 ......n n&&n II'T'aAW.aa.a T SOU.... PO. BOX la.' .....g.no. .~](.T1.'Y.,Ufl'" l?lO'-La.e TU.&".oJtJt (11T) atM-...., pAJC; '71'1) ao.-..o' PmK a'MAIL. Qu.oUU.W,C:OM ""TMoIIIt L. OQ.CKJllG C# COl,IlIKL. ICJIIlHlY O''''CE.. 513 .cST QtOco.....rc AVtNUE .. O. .ox 1!l1 ICJtSlCT.IIA.17023 17171 '33-.0.. c...-u1i.1: O'''CE. 13 wUT ~CT STRUT C.."""ILI. ,.... 17012 c7'711.'.0111 January 22, 1998 "0"1( ,'''ICE.. I wUT ,.....tr IT.U~ TO.", ,.... 1'.01 111" '.3.,." -~ lro,,"- . ~-~ '7 . .-- ""., ICOttIUIIfOHO TO """"'"IJlItG o"ra: Stephen L. Grose, Esquire Keefer, Wood, Allen &. Raha1 210 Walnut Street P.O. Box 11963 Harrisburg, PA 1710S-1963 Re: Herre Bros., Inc. v. George A. Keller, tJdlb/a Keller Engineering Services No. 97-3987 Civil Dear Steve: Afrt:r receiving your letter of JanlW)' 9, 1998, and carefully reviewing the letter with my client, our position is as follows. We would be willing to inaease our proposed 18 month time limitation to 24 months. We also have no problem with allowing your client to pay a minimum $ 1,000 on each job of $2S ,000 to $50,000 in addition to the minimum $2.000 payment on jobs over and in excess of SSO,OOO. The additional conditions, based on the amount of work your client obtains over the subsequent 2 years is not acceptable. My client does not wish to incorporate any conditions which would jeopardize his payment of the S17,OOO settlement amount. In going over your proposal with the client. we do not believe the added conditions placed upon the amount of work obtained over the next 2 years are n~"''1' to encourage both of our clienu to do business with one another. As we have been streSSing to you throughout these negotiations, my client does not believe it will be diffi<:ult for your client to obtain the requisite amount of business to payoff the S10,ooo in a period of 18 months. let alone 2 years. If anything, your proposal encouraaes Herre Bros. to give Keller special consideration in order for Herre Bros. to get paid the amount for which it wishes to settle. n.is is not consistent with the intent of the parties to continue to operate under good faith business practices and fair bidding. the initial telephone conversation. I advised Mr. Grimm that the offer set forth in their letter dated November 14, 1997. W:1S unacceptable. I offered a total of S15,ooO over the next five (5) jobs of S50,ooo or more. indicating to Mr. Grimm that my incre:1Se from 55.000 to 515.000 W:1S b:1Sed upon my ability to obtain these five (5) jobs. 7. Mr. Grimm advised that he wanted a total of 520,000 but that he would extend the time period from 12 months to 18 months to pay the remaining 515.000. I indicated that W3S unacceptable. 8. I then offered 55,000 C:1Sh now and 515.000 upon receipt of five (5) jobs of S50.000 or more. Mr. Grimm advised that he would :lCcept 510,000 c:1Sh now and 510,000 over the next five (5) jobs of 550.000 or more. No time Iimi13tion was discussed. I indicated I needed to think about his offer. 9. I c3Iled Mr. Grimm later that same daY:llld advised Mr. Grimm that the Kmagic number is 57,OOO,K which I agreed to pay before the end of 1997, with 510,000 spre3dover the next five (5) jobs of 550,000 or more, with a payment of 52.000 on each job. No time limil3tion was discussed. Mr. Grimm suggested that 1 could make more th:lll the 52,000 if I W:lllted. but only 52,000 on each job W:1S required. I agreed. Mr. Grimm agreed. indicating th:u he wanted to get this matter behind him. 10. There W:1S no mention of the five (5) jobs being within any time fr:une, nor was there any suggestion that the matter W:1S not then settled. I advised Mr. Grimm that I would have my attorney prepare a settlement agreement, based on the terms of the settlement we h3d rea.:hed. Mr. Grimm agreed. 11. I called my counsel, advised him of the terms of selllement and told him to prepare a settlement agreement. He advised that we should first confirm the terms of settlement in writing. As a result, my counsel forwarded a leller to counsel for Herre Bros., selling fonh the terms of the settlement re:1Ched by l'vlr. Grimm and me on November 26, 1997. A copy of that leller is attached to the Motion to Compel as Exhibit "C". 12. On December 5,1997,1 received a telephone call from my counsel advising me that counsel for Herre Bros. confirmed the terms of the settlement as I had relayed them. but requested that we also put in the f:1Ct that the $2,000 p:lyment was a minimum payment :md that I could pay more on any of the five (5) jobs if I so desired. My counsel forwarded me :l copy of the letter he received from Herre Bros.' counsel dated December 4, 1997, which is attached as Exhibit "D" to the Motion to Compel. 13. After receipt of th:ltleller, I authorized my counsel to prepare the Settlement Agreement and Release based upon the terms of settlement re:1Ched with Mr. Grimm on November 26, 1997, (and confirmed in writing) and forward it 10 Herre Bros.' counsel. He did so under cover letter dated December 7, 1997. See Exhibit "E" to the Motion to Compel. 14. On December 19,1997,1 received a telephone call from my counsel indicating that he had received a letter from Herre Bros.' counsel, wherein they requested several minor refinements to the Settlement Agreement and Rele:ISC, but in addition, requested that:m 18 month time fr.une be pl:1Ced upon the payment of the $10,000 from the five (S)jobs. without any suarantee of receiving five (S) jobs within that time fr.une. This was a m:lterial change in the '. HUTH ~ ALLEN N. DAVID "'H"~ WILLIAM E. MILLEIlI, ...... CHAIlILU W. IlIU.CHOAL'- U lIt()altltT L. WIlL-OOM EUGINE I. flllIItNSKY, ",ill THOMAS E. WOOO ..10M" H. ENOIi m GAlIIIY I.. ,,"INCH DONNA ._ WE-LOCN .""'0'011I0 DOIlIIlIANCI Jt"IIII'1" S. STOKES 1t08ClltT Ill. CHUlItC" .TC~EN L. QftOll lit. seon I...UIlII" WAYNE M. nCHT DONALD .... LEWIS m ."IOGIT .... WHrTLCT KA"EN 811tOTHIlIllI filii"''' ."INCA S. LYNCH IHAWN w. WIl'1 KEEF'ER WOOD ALLEN & RAHAL, LLP 210 WAL.NUT STREET ... O. BOX IIIU53 H...RRISSURG, ..... 17101l'lge3 PHONE 17171 z:I:I.eooo ,....x (717) 2:1:1.80:10 EST..Lot.HID IN '171 0" COUNSEL. wILL1AJi14 H. WOOO SAMUEL C. HAIIU'Y wilT IHO"I O""'CI. .'1 '...l,.LOW'IILD ..cAD CAMfI HILL. filA 11011 ElM NO 1:3-01'8'35 January 9, 1998 flHQN117I'7) e,'-.'Oo 'AX (717) .'1,.'01 ..ITI.... D,ltCCT D'." 255-8052 Steven E, Grubb, Esquire Goldberq, Katzman' Shipman P.C, 320 Market Street PO Box 1268 Harrisburg PA 17108-1268 Re: Herre Bros., Inc, v. George A. Keller, t/d/b/a Keller Engineerinq services civil Action 97-3987 Court of Common Pl@&s of CUmberland County Dear steve: RE'rt:"'r~,"", ,. 'I -4 .. ':'-::9 Your position is that there is no settlement in this matter and our position is that there is a settlement as set forth in the Settlement Agreement signed by my client. I provide you with a copy of a recent opinion by Judge Turgeon on this issue for your review. Without prejudice to either of those respective positions, I agreed to address the issue of a time limitation on the payment of the additional $10,000 ($2,000 on each of five (5) jobs) with my client. He hiS recommended the followinq as a resolution of the impasse. The additional $10,000 would be paid within a 24 month period, $1,000 on each job for ten (10) jobs of $25,000 to $50,000, or $2,000 on each job for five (5) jobs in excess of $50,000, These would be minimum payments for such jobs, If after 24 months, a total of $10,000 has not been paid, ADd my client had reCeived six (6) or more jobs of $25,000 to $50,000 or four (4) or more jobs of more than $50,000, then he would be required to pay the balance of the $10,000. If, however, my client had received five (5) or fever jobs of $25,000 to $50,000, or three (3) or less jobs of more than $50,000, then he would pay only one-half of the balance remaining on the $10,000, An example would be as follows: If my client received, OVer the next 24 months from the date of a new settlement agreement, six (6) jobs over $25,000 but not more than $50,000, he would haVe paid $6,000 on the $10,000. After the 24 month period, the balance remaining would be $4,000 and since my client would have exhibit E -. . , LAW OPPlca. GOLDBEBO. KATZMAN & SHIPMAN. p.e. JtONAl.D N. KATZMAN HAMY '0 C)C)LOIPO ,.La""'......... PAUl, J. IPOSITO NEIL MtNDtI'IMCT oJ. ,JAY COOfl'Dl' n.c....1 c. PENe" ...IOt4Jll A. ITAn.Ot A"tIL L. IT"AHQ..cUTAT GUT tot. POCKS JU,.tRSON .L .......... 'UJlltH S. 'tuOtTtNIC"QlIll ./OM" ,J. JtUSSO MlC"An. J. c:JtOCtNZI A"NOLD I. .00"" T\4OfolA' J. WUEA tv... ... 1tL1fC. .. .ow ClQ.OfttNZO ITtVDtl. ~ QlAI(A, wOOOSIX .JOt<W It. ...0,,' .Jao au.aaK'l' STKZBT ~.W.EJl.&T SOU." P.O. BOX lR811 ....1S.U.O. PalflfSTLVAJrCIA 1710S-taSe T'ZU.BOtf&: (1171 8:)4-4.11. PAX: (711'1 AG+eeoa pmM a-MAIL: OU.OULAW.CON .....~ l.. aCM.CKJtO 0' C~~ .e"",," 0"'1(1. S,U wtlT CHCC:Ol.ATt AvENUE (It Q. 10. SS' ICJIIStCT. ...... .7033 17171 '33-.0.. January 22, 1998 CAIltLIS!..tM'Cl. " wtlT 'OMI'''Er IT"aT CAltUl\.t. "A. .7OtJ 17171 Z4'-01.7 TOIhl c'''tee. I _tiT ...."II.Ef 1'''1.1:1 TOil",. .... 17.01 1717' ,.J. 78" Stephen L. Grose, Esquire Keefer, Wood, Allen &. Rahal 210 Walnut Street P.O. Box 11963 Harrisburg, PA 17108-1963 __ .r.::-. '-__ ' -::; /7 ,r._., ~ . . '; ICO''''CPONO TO MAlt,"SIUltG O"tCEi Re: Herre Bros., Inc. v. George A. Keller, t/dlbla Keller Engineering Services No. 97-3987 Civil Dear Steve: After receiving your letter of January 9, 1998, and carefully reviewing the letter with my client, our position is as follows. We would be willing to increase our proposed 18 month time limitation to 24 months. We also have no problem with a1lowing your client to pay a minimum Sl,OOO on each job of $2S,OOO to SSO,OOO in addition to the minimum S2,OOO payment on jobs over and in excess of SSO,OOO. The additional conditions, based on the amount of work your client obtains over the subsequent 2 years is not ~Ie. My client does not wish to incorporate any conditions which would jeopardize his payment of the SI7,OOO settlement amount. In loing over your proposal with the client, we do not believe the added conditions placed upon the amount of work obtained over the next 2 years are nec('....ry to encouraae both of our clients to do business with one another. As we have been stressing to you throu&hout these ne&otiations, my client does not believe it wUl be difficu1t for your client to obtain the requisite amount of business to payoff the S10,OOO in a period of 18 months, let alone 2 years. lfanythinl, your proposal encoura&es Herre Bros. to live Keller special consideration in order for Herre Bros. to let paid the amount for which it wishes to settle. This is not consistent with the intent of the parties to continue to operate under load faith business practices and fair biddin&. Stephen L. Grose, Esquire January 22, 1998 Page 2 The amount of which we are speaking is only $10,000 (plus the initial $7,000 payment), and we are giving your client 2 years to pay that amount off, without interest. We believe this to be reasonable and extremely favorable to your client. It has been our position throughout our correspondence that we have been in the course of ongoing settlement negotiations. I believe we have made clear to you throughout these negotiations that settlement was. and continues to be, conditioned upon a signed Release and Settlement Agreement. While we have considered the case which you sent us, authored by Judge Turgeon, we believe it to be easily distinguishable on its facts and would cite to you cases such as Schulman v J P Mmt3n Inve~tment Manafement Inc., 3S F.3d 799 (3d Cir. 1994), F\\ner v Shoem~1nor, 393 Pa. 422, 143 A.2d 364 (1958), and FiYnhex:ih v F1ei~her, 188 Pa. Super 99, 145 A.2d 903 (1958), and other cases which hold similarly, which state that it is black letter Pennsylvania contraCt law that when one party has expressed an intent not to be bound until a written contr3Cl is executed, the parties are not bound until that event has occurred. We believe we have a strong legal defense in that it was made very clear to you that any settlement was contingent upon a ~". and a mutually agreeable Settlement Agreement. All other exchanges were merely settlement negotiations. SEGIksd cc: Edward R. Grimm r. 3. On or about April 16, 1997, Herre Bros. was preparing to submit a bid to provide services to the Shrewsbury School District located in Shrewsbury, York County, Pennsylvania, penaining to the construction of a new heating, ventilation and air conditioning unit (HV AC) at the Shrewsbury Elementary School. 4. As is standard in the industry, Herre Bros. solicited bids from various subcontractors to furnish HV AC equipment for the Shrewsbury Elementary School Project. S. As is standard in the industry, the bids from the subcontractors would be used by Herre Bros. in the formulation of its own bid to the Shrewsbury School District for the Shrewsbury Elementary School Project. 6. It is standard business practice that where general contractors solicit and receive bids from subcontractors, the subcontractor is committed to that bid, since the general contractors rely on those bids in formulating their own contract bids to the owner of the property. 7. In response to Herre Bros. 's solicitation for bids, on or about April 16, 1997, Keller, by fax, submitted a bid to provide HVAC equipment to Herre Bros. for use in the Slmwsbury Elementary School Project. A copy of the bid proposal is attached hereto as Exhibit -A-. 2 . WE ARE PLEASED TO PROVIDE YOU 'Wlrn OUR PROPOSAL TO FURNISH HV Ae EQUIPMENT \ FOR ntE ABOVE PROJECT. . . J\. UNlT VENTILATORS UV.I THRU UV-40 BY NESBITI' AS FOLLOWS: FORTY llIREE(43). VERTlCAllHORIZONTAL UNIT VENTILATORS. MODEL TeW/Hew WIllI: .eHtLLEDWATERCOOLINGCon. <A V- 'i J "} . HOT WATER HEATING COIL CI.','I....; FIlJ,J/""'C'I..t; . 2.SPEED FAN SWITCH D ,,' r/'. ~ . 277VIIPH PSC MOTOR A FAN ASSEMBLY .' 't'l,r 'f/1/tf't.! ", l'1'1',.r't C',rt/_.. . DAMPER ASSEMBLY WI WALL LOUVERS fI/ J . (! c..cJ. eCl... f' . THROWAWAY AIR FtLTERS . BAKED ENAMEL mIlSH. COLeUROM CHART . . FACTORY INSTALLED CONTROLS(FURNISHED BY OntERS) XpACKAGED AIR COOLED CHILLERS CH.I A CH.l BY YORK AS FOLLOWS: V TW0(2). AJR COOLED eHlUERS. MODEL YCAZlIDB3 W11li: / . AIR COOLED CONDENSER WI COPPER TlJBE/ALUMINUM FIN COIL . INSULA TED DX COOLER . RECIPROCATING COMPRESSORS . MICRO COMPtTT'Ell CONTROL CENTER . CONTROL TRANSFORMER . INDEPENDENT REFRlGERA TlON CIRcutTS . DtSCONNECT SW1TCH . CHILLED WA nil. FLOW SWITCH . VIBRATION tSOLA TORS .tYlLPARTSONLYWAIUlANlY . FACTORY START.UP SUPERVISION 04-16-1997 10:S1AM FRll1 KELLER rn:iR. SERVICES TO 17177328208 P,01 . -lEE . - KELLER ENGINEERING SERVICES APRIL 16. 1997 TO: AU. INTERESnD BIDDERS SUBJECT: SHREWSBURY ELEMENTARY SCHOOL , v PACKAGED ROOFTOP AiC UNITS RT.I THRU RY.! BY YORK AS FOLLOV.'S: F\VE(S). mGn EFF1Cte1CY (jAS FIRED RlU, MODEL ceo W11li: _ NATURAL GAS MEA TING SECTION WITH REDUNDENT GAS VAt VES . SOLID STAnSPARX IGllmow ,/ . COMPlESSORS W/INTEIlNAL OVERLOADS ct R.U ItEFlUOERANT V . COPPER TUBEiALUM. FIN HEAT EXCHANGER . RlGH A LOW PltESSURE SWITCHES. F1tEEZESTAT . 24V CONTROL CIRCUIT , Ao.nJST ABLE BELT DRIVE EV AJ'ORA lOR F.(N . IlOOF CURB . MOTORIZED OUTSIDE AIR DAMPER WI RELIEF .1 YEAR PAIlTS WAIlRANTYON ENTIRE UNIT . S Yt!AR COMPIlESSOR PARTS WAnANTY +HYDRONIC UNIT HEATEltS BY A\RTlWlM AS FOLLOWS: THaU(3). HOIUZONTAL UNIT HEArns. MOOEl. HU WITlt; . NQN.FEUOUS HOT WA TtR MEA TDlO COlt . FOUR.WA Y ADJUSTABLE LOUVERS ,psc ,",OTOll WI AL~ 'AM ".O.lkl1l173 . ~1Ie."" IU6Z . 711-6Z~ZO ' ,..717-621.0708 .~...'; .' . ....,.. ''''1,.- 04-16-1997 10:S2AM FR01 KELLER eGR, SERVICES TO 171rf~ P,e2 0(. KELLER ENGINEERING SERVICES I SHREWSBURY ELEM.. CON'T , FAN COn. UNITS FC-t THRU FC..tO BY AIRTHERM AS FOLLOWS: . ~" . THIRTY NlNE(39)- VERnCAUliORlZONTAL FAN COIL UNITS, MODEl. P/CP WITH: i), I ~';, ,(,."1 " I sa A. STEEL CASING . BAR TYPt: DISCHARGE GRILLE Fc - j V'fO V' _ BAKFD ENAMEL mIlSH. COLOR SELECTION FROM CHART , " f' t:a, Q ,.0....' : ~~~~~ ~~;~ ~~~D~MI'ER(VERTtCAL UNITS ONLY) III nil oJ (fir- (..'1 F-r;. _ O.A. WALL LOUVER(VERTtCAL UNITS ONLY) ? . PSC HIGH EfFlCIENCV MOTOR ! \ . UNlTIWALL MOl1N1lID FAN SPEED SWITCH 1\ - "'"PIPE CHILLED WATER COOLING ~ HOT WATER ilEA TING COILS ',j ~ IIANDUNG UNtTS AH-t THRU AH.15 BY MACIC AIRE A!; FOLLOWS: ().."o - - FOURTEEN(14) - HORIZONTAL BELT DRIVE AHU, MODEL BHW WITH: . _ FAN/COIL SECTION WITH BAKED e'NAMEL F/NlSH ./ - sm. 30% EfF. THROW A WAY AIR FlL TERS(I SET) . F AcrORY MOUNTED MOTOR & ADJUSTABLE DRIVE . CHILLED WATER COOLING COIL(CONNECTlONS AS SHOWN) _ HOT WATER HEATING COtL(FAcroRY MTD.IN PREHEAT POSmON) \ I' IlYDll.ONtC UNIT HEATERS BY AIRTHERM AS FOLLOWS: THREE(3) - HORIZONTAL UNIT HEATERS, MODEL HU WITH; . NON-FERROUS HOT WATER REATING COIL )"' . FOUR.WAY ADJUSTABLE LOUVE'RS . PSC MOTOR WI AlUMINUM fAN .c . .. f ... ." -' CONVEcrORS C.l THRV C-&4 BY AIRTHERM AS FOLLOWS, SEVENTEEN(13) . SURFACE MOUNTED, MODEL F WlTH: V . IICA. STEEL CABINET. LOUVERED Oun.ET I . ACCESS DOOIl . RNOB DAMPER . BAKED ENAMEL FINISH. COLOR SELECTION FROM CHAllT \. FINNED 1l1BE RAOIA nON BY RmLlNG AS FOlLOWS: .j/\ SDC(6) SEctTONS - HYDRONtC BASEBOARD. MODEL FSOL WITH: . V . LotJ'IEREO DtSCHARGE GRILLES . WAlL MOumED 16(;A. CABINET . BAKED ENAMI!L FlNlSH - COLOR FROM CHART , COPPER TUBFJALUMlNUM FINNED ELEMENT - END CAPS a: WAll TRIM AS REQUIRED . - . '- 'WI"""- ~ .. rrEMS NOT INct.UDI'O' . VAlVES ,I; COtmlOLS OTHER mEN MENTlONED ABOVE . MOTOR STARTERS,I; DISCONNECTS OlHER THEN MENTIONED ABOVE . VIBItA nON ISOLA nON nln-NC- NET PlUCE(INCLUDlNO FIlElGHT).._..._...._.....___.._...___...._.._._..._..._1 sa,.. PLEASE NOW: nm ABOVE P1UClNO DOES !tOT INCLUDE SALES TAX. WE AU LOOKING FORWARD TO WORXtNG WITH YOU ON nus PIlOJEcr. '" YOU HA V! ANY QVE$11ONS. PlEASE FEEL FIlEE TO CALl. VDY nUL Y YOURS. ~ U ENClNURll'lGSUVlCU ~~.#' GIlA~~- 1 \S ,... r::' l-~ .. c: .- ,.~ t . ,~ ., ~ 1 .' (. ) ~ ,;:t . I. -- y~ 0' ." ., ,. C"~ , " r,: I , .. : ,. . . .. w ,... :~ CO \J .N '''' , .. .~~ ~ p ~ ~ ...... .. -. ,-'" I~ ~ ~ ~ "- "'"'" ~ ~..., ~ --- ~ .. ..... .:, '" '11 <9G~ . HERRE BROS., INC" Plaintiff IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA . , v. : CIVIL ACTION - LAW GEORGE A. KELLER t/d/b/a : No. 97-3987 CIVIL KELLER ENGINEERING SERVICES, Defendant JURY TRIAL DEMANDED ANSWER WITH NEW MATTER OF DEPENDANT AND NOW, comes the defendant, George A, Keller t/d/b/a Keller Engineering Services ("Keller"), by and through its counsel, Keefer Wood Allen & Rahal, LLP and files this answer and new matter to the complaint in the above matter, averring as follows: 1, Admitted upon information and belief. 2, Admitted as to all times relevant to the complaint, 3, Admitted upon information and belief. 4. Denied as stated. It is believed and therefore averred that the request for proposals solicited by Herre Bros, were from suppliers, not subcontractors, for the H.V,A,C, equipment on the Shrewsbury Elementary School Project ("Project"), 5, Denied as stated. The request for proposals from suppliers, not subcontractors, would be used by Herre Bros. in forming its bid for the H.V,A.C. equipment on the Project, 6, Denied as stated. When general contractors solicit and receive proposals from suppliers, the supplier is committed to that proposal only after it is accepted by the general contractor and the supplier receives a purchase order. Further, it is not known whether Herre Bros. was a general contractor or a subcontractor on the Project. 7, Denied as stated, It is denied that Herre Bros. solicited a "bid" from Keller but that it requested a proposal, which was submitted by fax on April 16, 1997, at 10:51 a.m. It is admitted that exhibit "A" is a true and correct copy of the proposal submitted by Keller, with the exception of the handwriting placed thereon, presumably by Herre Bros. 8. Denied as stated. Keller submitted a proposal to provide the H.V.A.C. equipment identified in its proposal for the sum of $128,700.00. However, Keller advised Herre Bros. that it was withdrawing the proposal because of an error in calculations before Herre Bros, submitted its bid on the Project or accepted the offer set forth in Keller's proposal. Accordingly, the proposal was withdrawn before reliance or acceptance by Herre Bros. 9, Denied. Herre Bros. was aware that there was a prOblem with the price in the proposal before using it in preparing its bid on the Project. Further, Keller withdrew the proposal before Herre Bros. submitted its bid. Therefore, Herre Bros, could not have reasonably relied on the $128,700.00 figure contained on the proposal submitted by Keller. -2- 10. Denied. It is specifically denied that Herre Bros. accepted the $128,700,00 proposal submitted by Keller. To the contrary, Herre Bros. had questions as to the reliability of the figure in the proposal and in fact called to verify the figure, Further, the proposal was withdrawn before Herre Bros, was required to submit its bid on the Project. Finally, it is not known whether Herre Bros, used the $128,700.00 figure provided by Keller when Herre Bros. submitted its bid to the Shrewsbury School District and strict proof thereof is demanded at trial, 11. Denied. It is specifically denied that Keller submitted a "bid" and further denied that Herre Bros. accepted Keller's proposal at its office in Enola, in Cumberland County. To the contrary, the proposal submitted by Keller was withdrawn before any acceptance or reliance by Herre Bros. 12. Denied as stated. After reasonable investigation, Keller is without sufficient knowledge or information to form a belief as to the truth of the matters asserted. Accordingly, they are denied and strict proof is demanded at trial. 13. Denied. It is specifically denied that Keller submitted a "bid" but rather, submitted a proposal in the amount of $128,700.00, which was withdrawn before being accepted or relied upon by Herre Bras, As to the remaining allegations, after reasonable investigation, Keller is without sufficient knowledge or information to form a belief as to the truth of the -J- matters asserted, Accordingly, they are denied and strict proof demanded at trial. 14, Denied, It is specifically denied that Keller was to perform any work involving construction on the H.V.A.C system under its proposal, but only to supply equipment. Further, Keller's proposal was withdrawn before being accepted or relied upon by Herre Bros. As to the remaining allegations, after reasonable investigation, Keller is without sufficient knowledge or information to form a belief as to the truth of the matters asserted. Accordingly, they are denied and strict proof demanded at trial. 15, Denied. After reasonable investigation, Keller is without sufficient knowledge or information to form a belief as to the truth of the matters asserted, Accordingly, they are denied and strict proof demanded at trial. 16, Denied. It is specifically denied that Keller submitted a "bid", but instead, submitted a proposal, which was not accepted before being withdrawn. After reasonable investigation, Keller is without sufficient knowledge or information to form a belief as to the truth of the matters asserted, Accordingly, they are denied and strict proof demanded at trial. 17. Denied. It is specifically denied that Keller submitted a "bid" but instead submitted a proposal, which vas -4- withdrawn before being accepted or relied upon by Herre Bros. After reasonable investigation, Keller is without sufficient knowledge or information to form a belief as to the truth of the matters asserted, Accordingly, they are denied and strict proof demanded at trial. 18. Denied. It is specifically denied that Keller reneged on its proposal or any promise since Herre Bros. had knowledge that the figure in the proposal could not be relied upon, and in fact the proposal was withdrawn before being accepted or relied upon by Herre Bros, 19, Requires no response. NEW MATTER 20, On the morning of April 16, 1997, Ed Grimm, Senior Vice President of Herre Bros., called and left a message at Keller asking if there was a "problem" with the numbers on the proposal and requesting that Keller call to confirm whether it was a good number or not. 21, Keller had also submitted proposals to James Craft , Sons ("Craft") and H , R Hechanica1s ("" , R"), by fax, on the morning of April 16th. 22, ~e11er became aware that there was a problem with the $128,700,00 figure in its proposal shortly after it was faxed but -5- could not readily identify the error. Phone calls were received by Keller from Herre Bros., H & R, and Craft shortly after the fax was sent on April 16, 1997, because it was substantially below other proposals for the H.V.A,C. equipment. 23, Keller was reviewing the $128,700.00 figure to determine where the error was located and when it was unable to locate the same, called H & R, craft, and Herre Bros., to advise that the proposal should be withdrawn. 24. Both H & R and Craft withdrew the proposal submitted by Keller. However, Tim Gesford, a Project Estimator with Herre Bros., upon being notified by Keller that the proposal was withdrawn, indicated Herre Bros. would still use the proposal in SUbmitting their bid on the Project. It is believed and therefore averred that Herre Bros. had proposals other than the one submitted by Keller for the H,V.A,C equipment that it could have used in submitting its bid on the Project. 25. Herre Bros. did not issue a purchase order to Keller for the H,V,A,C. equipment listed on the proposal. 26. Herre Bros. never accepted the proposal by Keller, and particularly not prior to its being advised that the figure given in the proposal was not a good figure and was being withdrawn, 27. It is reasonable and customary in the industry for the contractor whose bid is ultimately accepted, to contact all of -6- its suppliers and subcontractors and request a reduction in the figures used in the proposals submitted, Nothing is final between the contractor and a supplier, or a subcontractor, until a purchase order is issued by the contractor. 28, There is no enforceable right between a contractor and a supplier or subcontractor on a proposal that is used in the submission of a bid, until it is accepted by the contractor, at which time it is enforceable by the contractor against the supplier as well as by the supplier against the contractor. 29, Herre Bras, could not have reasonably relied upon the proposal submitted by Keller since it knew that there was a problem with the figure, called and asked Keller to confirm the figure, and the proposal was withdrawn before accepted or any reliance was placed on it by Herre Bros, 30, Herre Bros.' complaint fails to state a claim upon which relief can be granted, 31. Herre Bros. failed to mitigate its damages, 32, Any loss that Herre Bros. may have incurred in using the $128,700,00 figure in Keller's proposal was a result of its improper and unjustified reliance on that figure after the proposal was withdrawn, -7- GOLDBERG,KATZMAN a S1I1I'MAN, r.c. Rooald M. Ka....... Eoquln -I.D. 10719. SIn.... OruIJIl, Eoquln . I.D. n5l97 _,a for ....ialilf 32DMarbt_ r. O. 10. 126. Harmbu". PA 17101.1161 (717) Z3~161 HERRE BROS., INC., Plaintiff IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION - LAW GEORGE A. IC"" "I{, tldlb/a KELLER ENGINEERING SERVICES, Defendant NO. 97-3987 CIVIL JURY TRIAL DEMANDED REPI.Y TO NEW MATTER Plaintiff, Herre Bros., Inc., by and through its counsel, Goldberg, Katzman &. Shipman, P .C.. replies to the New Matter of George A. Keller, Ildlbla Kel1er Engineering Services' (Keller) as follows: 20. Admitted. 21, After reasonable investigation, Herre Bros. is without sufficient knowledce or information to form a bellef as to the tNth of these averments, and strict proof is demanded at trial. 22. After reasonable investigation, Herre Bros. is without sufficient knowledge or information to form a belief as to the truth of the averments that .Keller became aware that there was a problem with the $128,700 figure in its proposal shortly after it was faxed, but could not readily identify the error,. and as to whether or not Keller received a telephone call from H & R Mechanicals (H&R) and James Craft & Sons (Craft) shortly after sending its fax on April 16, 1997. Strict proof is demanded at trial. By way of further reply, Herre Bros. did make a telephone call to Keller pertaining to Keller's proposal for the HV AC equipment, because the bid was lower than all others received for HV AC equipment. It is denied that Keller's bid was .substantially. below other proposals for the HV AC equipment. 23. It is denied that Keller called Herre Bros. to advise that the proposal would be withdrawn. It is furthermore denied that Keller ever withdrew its proposa1 from Herre Bros. prior to Herre Bros.' submission of its bid to Shrewsbury School District and its subsequent acceptance by Shrewsbury School District. As for all remainina avaments, Herre Bros. is without sufficient knowledge or information to form a belief as to the trUth of these averments, and strict proof is demanded at tria1, 2 24. It is denied that Tim Gesford, a project estimator with Herre Bros., was ever notified by Keller that Keller's proposal was withdrawn. In fact, through a telephone conversation with personnel from Herre Bros., Keller confirmed to Herre Bros. the viability of its proposal prior to Herre Bros.' submitting it to the Shrewsbury School District. By way of further reply, Herre Bros. admits that it had proposals, other than the one submitted by Keller for the HV AC equipment, that it could have used in submitting its bid to Shrewsbury School District. However, it is denied that Keller withdrew its proposal, so Herre Bros. had no reason to use another proposal in its bid. As for all remaining averments, Herre Bros. is without sufficient knowledge or information to form a belief as to the trUth of these averments, and strict proof is demanded at trial. 2S. Denied as stated. While it is admitted that Herre Bros. did not physically send a purchase order to Keller for the HV AC equipment listed on Keller's proposal, it is denied that Herre BIos. did not "issue' a purchase order due to the fact that Herre Bros. attempted to send a purchase order after notifying Keller it had been selected to supply HV AC equipment. It was at this time that Keller notified Herre Bros. that they could no longer honor the proposal they had submitted to Herre Bros. on April 16, 1997, and whicb had subsequently been used by Herre Bros. in its bid to Shrewsbury School District whicb was accepted by the Shrewsbury School District. 3 26. The averments state a legal conclusion to which no response is required. To the extent anything factual is averred, the averments are denied. By way of further reply, Herre Bros. accepted the proposal by Keller and incorporated it into its bid to the Shrewsbury School District, which was subsequently accepted. It is furthermore denied that Herre Bros. was ever advised by Keller that the figure given in the proposal was not a good figure and was being withdrawn prior to Shrewsbury School District's acceptance of Herre Bros.' bid. 27. Admitted in part, with qualification, and denied. It is admitted, with qualification, that a contractor whose bid is ultimately accepted, "will contact all of its suppliers and subcontractors and request a reduction in the figures used in the proposal submitted." However, this is not a practice which is always utilized. Therefore, Herre Bros. qualifies its admission because this practice is not a "customary" practice in the industry. Herre Bros. denies the averment that "Nothing is tina1 between the contractor and supplier, or a subcontractor until a purchase order is issued by the subcontractor," because it is a legal conclusion to which no response is DCCl""'ry. By way of further reply, a party in the position of Herre Bros. places substantial reliance on a proposal such as the one Keller submitted to Herre Bros. on April 16. Unless told otherwise, once the proposal is JllCCived and incorporated into a bid which is l(~lICd by the owner of a p1operty, the supplier is bound by the number contained in its proposal. .. 28. The averments of this paragraph contain a legal conclusion to which no response is necessary. By way of further reply, as explained in the Complaint, Herre Bros. did accept the proposal by Keller and incorporated the proposal into a bid to the Shrewsbury School District which was subsequentlyacoepted, at which time Keller's proposal was enforceable by Herre Bros. against Keller. 29, The averments of this paragraph contain a legal conclusion to which no response is necessary. By way of further reply, to the extent these allegations aver facts, all facts are denied, since Herre Bros. relied upon the proposal submitted by Keller, Herre Bros. did not know there was a problem with the figure because Keller confirmed the viability of the figure, and Keller did not withdraw its proposal. 30. The averments of this paragraph contain a legal conclusion to which no response is nece!5ary. To the extent any factual allegations are made, said facts are denied. 31. The averments of this paragraph contain a legal conclusion to which no response is ,.,......<:Iry. By way of further reply, Herre Bros. did mitigate its damages, as explained in the Complaint, by obtaining the services of H. C. Nye Company, Inc. (Nye) once Keller informed Herre Bros. that it would be reneging 01\ its proposa1 which had been accepted and relied upon by Herre Bros. s 32. The averments of this paragraph contain a legal conclusion to which no response is nece.""ry. To the extent any factual averments are made, said averments are denied. By way of further reply, Herre Bros. properly relied upon the figure provided by Keller, and Keller never withdrew its proposal, but rather confirmed its viability, WHEREFORE, Herre Bros., Inc. demands judgment against Defendant, Keller Engineering Services, in an amount in excess of $25,000, the arbitration limit in Cumberland County, together with interest, costs of suit and any other remedy which this Court may deem just and appropriate. GOLDBERG, KATZMAN "SHIPMAN, P.C. By.' ,-- . J. .',t,"" Steven E. Grubb, Esquire 1.0. nS897 320 Market Street P.O. Box 1268 Harrisburg, PA 17108-1268 (717) 234-4161 Counsel for Plaintiff, Herre Bros" Inc. DATE: 't /: :7 ....:SIiO:DllCS:H.:1<Ct I -:1lD'L Y JlMI 6 '.. ,:-'J ~ C'~ ... . -. \--^ , l'l'- . \.~ (,', -~ r~' . ..- . y~ ''"'. 2 ('. .- -u~ l". . .-', "~ 11 I. I vI . . L'. r- t () <1' i) The instant matter pertains to an alleged settlement between the parties, George Keller of Keller Engineering Services and Edward Grimm, Vice-President of Herre Bros., on November 26, 1997, Messrs. Keller and Grimm had personally attempted to negotiate certain terms of a settlement up to November 26, 1997. The parties eventually agreed that Keller would pay Herre Bros. $7,000 before December 31, 1997, Keller would then pay $10,000 in minimum increments of $2,000 whenever Herre Bros, awarded Keller a bid in excess of $50,000. While agreeing 10 the above limited terms, Mr. Grimm made it clear 10 Mr, Keller that no settlement agreement would be consummated without the execution of a written agreement drafted by the respective parties' attorneys. Additionally, during the talks between Mssrs. Grimm and Keller, Mr, Grimm insisted that the matter be completed by the end of 1998. Later, as a point of compromise, Herre Bros. allowed Keller 18 months from the date of execution of a signed agreement to complete its payments to Herre Bros. Following the talks between Messrs. Keller and Grimm, Mr. Grimm notified his attorneys of the settlement terms which had been discussed, Mr, Keller volunteered his attorneys to draft the initial settlement agreement, Counsel for Keller did so on December 8, 1997 (see Ex. E of Keller's Motion). By letter of December 18, 1997 (see Ex. F of Keller's Motion), counsel for Herre Bros. suggested four chaJ1aes to the settlement agreement. Counsel for Keller accepted and ..2. matters led to agreement, or at least Herre Bros. insistence, that an agreement not be consummated until the execution of a written document. Furthermure, during the course of their negotiations, both parties contemplated their attorneys creating a document. Mr. Keller volunteered his attorney for the creation of the initial draft of the Settlement Agreement and Release. .Se.c'8 of Keller's Motion to Compel Settlement and George Keller's Affidavit at "10 and 11. The communications between the attorneys after November 26, 1997 verify the requirement of a signed writing. On December I, 1997 (Exhibit C of Keller's Motion), counsel for Keller admitted that only upon execution of a document would Keller issue funds to Herre Bros. be exchanged or the action be discontinued. In a writing dated December 4, 1997 (Exhibit 0 of Herre Bros.' Answer to Motion to Compel Settlement), counsel for Herre Bros. pre-<:onditioned settlement on Herre Bros.' Mbeing supplied with an executed copy of the Settlement Agreement and Release. M On December 8, 1997 (Exhibit 0 of Keller's Motion), counsel for Keller, once again, stated thatllpon execution of the avreemenl, the selllementterms would be consummated. Contrary to Keller's Motion, final settlement was always pre-<:onditioned on the existence of a signed writing. It is also clear that the parties had not yet completed negotiating the settlement, which further explains the necessity of a signed writing prior to final settlement. On December 18. 1997, counsel for Herre Bros. sent proposed revisions to counsel for Keller Engineering. Three -6- of the four suggested revisions M:Il: accepted by Keller and incorporated into the draft Agreement. While counsel for Keller selectively and sclf-servingly identifies these additions as "non material", the changes accepted by Keller were just as matllrial as the one not accepted by Keller's counsel pertaining to the duration of the contract. Next, on January 9, 1998 (see Exhibit 0 of Herre Bros.' Answer to Motion to Compel), counsel for Keller corresponded to counsel for Herre Bros. pertaining to another proposal for settling the matter. Counsel for Herre Bros. responded on January 22, 1998. (Exhibit E of Herre Bros. Answer to Motion to Compel). Once again, this shows ongoing negotiations between the parties, as late as January 1998. Herre Bros. manifested its intentions to Keller not to be bound until the completion of a signed document. Mr. Grimm's clear statements to that effect, the exchanges between counsel and the subsequent negotiations prove that the parties had not agreed to all terms of the agreement and, therefore, no settlement could have occurred prior to the execution of the agreement. B. TIME IS A MATERIAL REQUIREMENT OF EVERY CONTRACT, The element of time is essential to every contract. Where lime is not menlioned in the contract, the Court will imply the element of time. Where there is no expressed provision in the contract as to its duration, the intention of the parties in that regard is 10 he determined from the .7. surrounding circumstances by the application of reasonable construction to the agreement as a whole. Gloeckner v. Baldwin Township Sch. Disl., 405 Pa. 197,201,175 A.2d 73, 76 (1961); Thomas v. Thomas F1exibile Couplin~ Co., 353 Pa. 591, 597, 46 A.2d 212, 215 (1946); Keystone Bank v. Nuclear Ma~netic Resonance Specialties. Inc., 243 Pa. Super. 471, 477,366 A.2d 251, 253 (1976). Herre Bros. has only raised, in the course of negotiating this contract, a material element required in every contract. Amazingly, counsel for Keller resists including a contractual term required by law. Keller cannot avoid the element of time. The element of time will have to be addressed at some point, to the extent that Keller does not meet its contractual obligations of paying Herre Bros. $10,000 under the terms of the agreement. With the possibility of future court intervention on a settlement agreement, one of the goals of settlement is defeated. The two major goals of settlement are that (1) settlement expedites transfer of money into the hands of the complainant; and (2) settlement reduces the burden and expense imposed upon the courts. Sociedad Comercializadora v. Ouizada, 434 Pa. Super. 48, 641 A.2d 1193 (1993). The goals of settlement are not accomplished by enforcing this settlement agreement. Due to the lack of a time element, this settlement agreement is subject to further litigation. -8. In Gloeckner, SIIDIiI, a school district condemned certain lands and plaintiff proceeded to make a claim for condemnation proceeds pursuant to an agreement silent on the duration of the contract. The Court had to engage in a detailed analysis of the facts before concluding that plaintiff was not diligent in performing his contractual obligations, and the intent of the parties was that the contract should not last 11 years. llJ. at 202, 175 A.2d at 76. In Thomas, supra., the plaintiff sought enforcement of a 1920 contract in 1939. The 1920 contract was silent as to the duration of the contract, and the Court was faced with further litigation as to whether the 1920 contract remained in force in 1939. llJ. at 500-SOl, 46 A.2d at 21S. These cases show that contracts, silent as to their duration, are ripe for further litigation. That litigation will focus, first, on the intention of the parties. As this proceeding shows, there was no agreement on time because Keller refuses to even discuss it. It will be up to the Court to determine the contract's duration. The Cmln will have to intervene and one of the goals underlying the preference for settlement would be thoroughly defeated. Herre Bros., under the law. does nol have to let this contract last potentially into perpetuity as Keller would have it. The court should not give legal support to negotiations which are known to be legally insufficient. Even if the Court chooses to force a settlement, it should only permit a complete contract which includes the element of time. 18 months is a reasonable time for completion of Keller's contractual duties. .1). . . school district's acceptance of Herre Bros.' bid, Keller renegcd on its bid. Hcrre IJros. had to retain another contractor to pcrfonn the work Keller had promised to perform at a lower price, This resulted in a linancialloss to Herre Bros. 3. Denied. The allegations of the Complaint speak for themselves. A summary of the Complaint is contained in answer to paragraph 2, above, which is incorporated by reference. 4. It is admitted that the pleadings were c1used, discovery initiated and the issue of settlement raised in early November, 1997. Keller's characterization uf the November 11, 1997 letter (Exhibit A of Keller's MOlion) is denied as the letter speaks for itself. The letter attached as Exhibit A to Defendant's Motion is an unsigned letter, different in appearance than the letter received by undersigned counsel. Therefore, it is denied that the attached letter to Defendant's Motion is ". true and correct copy of the letter,. although the contents of the letter appear similar. S, It Is admitted that the letter attached to Keller's Motion as Exhibit B 15 a true and correct copy of Herre Bros.' November 14, 1997, correspondl:nce. The remaining allegations are denied as the letter speaks for itself. The Nuvember 14, 1997 leller was not intended to be a counteroffer, but rather an initial offer proposed to Keller. Herre Bros. did not consider Keller's initial SS ,000 offer to be . legitimate settlement offer by Keller. It is worthy to note that in the 2 '" " 4( November 14 letter, it was made clear that any installment payments were to have been concluded by the end of 1998, 6. It is admitted, upon information, that on November 26, 1997, George Keller called Ed Grimm, Senior Vice President of Herre Bros., to discuss settlement. It is denied that there were "several calls" which resulted in a discussion of settlement, It is denied that "[n]o time limitation relative to the payment of the (mal $10,000 was considered with the (mal offer, nor agreed to by the parties." As stated in the Affidavit of Edward Grimm, attached hereto as Exhibit A, during the course of settlement discussions between Messrs. Grimm and Keller, Mr. Grimm made it clear to Mr. Keller that any settlement had to be completed by the end of 1998. This was a threshold discussion which Mr. Grimm had assumed was an understanding which was included in all subsequent settlement discussions. Herre Bros. extended the time for completion of Keller's performance to 18 months at a later time, as a point of compromise, It is admitted that during the settelement negotiations, it was discussed and decided that Keller would pay Herre Bros. S7 ,000 by December 31, 1997, and that Keller would pay at least $2,000 to Herre Bros. on each of the next five (5) bids awarded by Herre Bros. to Keller of $50,000 or more. 3 , . 4 It is denied that this was the extent uf the selllement discussions. It was also understood by the two parties that there would be no settlement without a written Settlement Agreement and Release being executed by the two parties. .s.cc Grimm Affidavit, Ex. A. Mr. Keller even volunteered to have his attorney create the initial draft of the Settlement Agreement and Release, 7, Denied. It is denied that Mr. Grimm indicated that he was accepting the terms discussed by Mssrs. Grimm and Keller IOlely because Mr. Grimm wanted to get this matter behind him. Rather, as counsel for Mr. Keller stated in his November 11, 1997 letter (Exhibit A to the Motion), the two parties had "present and future business relationships" between them and wished to continue these business relatioll5hips under good terms. Therefore, it was advantageous for both parties, as business' in the community, to settle the matter before any "time, money and good will" were expended in Iiti,atin, the case. Mr. Keller wanted to settle the case and "get the matter behind him" just a. much a. Mr. Grimm did. The settlement liY.U made contingent upon execution of a written agreement. Mr. Keller volunteered his attorney to prepare the Initial draft, based on the preliminary negotiations and understandings reached by the parties which were to be part of the Settlement Agreement and Release. As Slated by Mr. Grimm in his Affidavit attached hereto as Exhibit" A ". Herre Bros. did not ~ ror a settlement to exist without the presence of a written Settlement Agreemelll and 4 . " believed he had made as much clear to Mr. Keller during the course of settlement negotiations. Additionally, counsel for Keller has admitted in his letter of December 1, 1997. attached to Defendant's Motion as Exhibit C. that "I will then draft an appropriate settlement agreement and release. !lIllm execution !If 1haI, we can have payment made by my client and have this action marked settled and discontinued with prejudice," Any settlement required the execution of "an appropriate settlement agreement and release. " 8. After reasonable investigation, Herre Bros. is withoutlmowledge or information sufficient to form a belief as to whether "Keller advised his counsel to prepare the settlement agreement but counsel for Keller advised they should confirm the terms of settlement with counsel for Herre Bros, first, which was done in a letter dated December 1. 1997." Therefore, these allegations are denied. It is also denied that the letter attached as Exhibit C is a "true and correct copy" of the letter which was sent to counsel for Herre Bros. as it is unsigned and not similar in appearance to the letter which was received by counsel for Herre Bros. It appears that the substance of the letter is the same as that which was received by Herre Bros. It should also be noted that in the December 1, 1997 letter it is stated by counsel for Keller that he will "draft an appropriate settlement agreement and release. Upon execution of that. we can have payment made by my 5 - . client and have this action marked settled and discontinued with prejudice." Counsel for Keller has acknowledged that the settlement of this matter was contingent upon an executed Settlement Agreement. 9, Denied. Counsel for Keller's self-serving analysis of his own letter sent on December 1, 1997, is denied, as the letter speaks for itself. The fact that counsel for Keller stated in that letter that the principals "had 'settled' the above matter" does not in any way reflect an agreement on the part of Herre Bros. with that statement. Herre Bros, believed thatllO settlement existed until a Settlement Agreement and Release had been executed. Additionally, counsel for Keller's gratuitous, self-serving description of the second paragraph of his letter as a "procedure" is denied. Herre Bros. understood the second paragraph as a reqJlirementto settlement. 10. Denied. Keller's self-serving analysis of the December 4, 1997 letter from counsel for Herre Bros. is denied as the letter speaks for itself, A portion of the letter, which Keller ignores, states that Herre Bros, "would be willing to grant a release to your client and I will have the action marked settled and discontinued, with prejudice, upon your client's payment of the initial $7,000 and my belnl provided with an executed C01lY of the Settlement A,reement and Release. I willloolt forward to your promptly providilll me with the draft of the Settlement Agreement and Release." This shows that from the initial conununication from counsel for Herre Bros. there was the necessity of a Settlement Aarecment. 6 .I ~ It is admitted that the December 1, 1997, attached as Exhibit MD" to the Motion, is a true and correct copy, but the letter is hardly a confirmation of settlement. The December 4, 1997 letter does not state, nor was it intended to state, that agreement had been reached on every point of settlement. As described above, it is made clear in that letter that any settlement or release would be contingent on an executed copy of the Settlement Agreement and Release which counsel for the parties would draft. 11. Denied. It is first denied that Herre Bros. settled the case or that the terms thereof had been conf1l1tled in a writing by counsel for Herre Bros, We incorporate our answers to paragraphs 6-10 above in support of a lack of a settlement, a lack of agreement on the temlS and a lack of confirmation of the terms, in writing, by counsel for Herre Bros. The remaining allegations of paragraph 11 are also denied. Mr. Grimm did not agree to terms of settlement, but only agreed to certain points with Mr, Keller. Settlement was not to have occurred until a signed Settlement Agreement and Release, prepared by the attorneys, had been executed by the parties. It is furthermore denied that a true and correct copy of the cover letter and initial draft of the Settlement Agreement and Release are attached as Exhibit E, u what appears u Exhibit E is an unsigned copy of a letter which does not resemble that which was received by counsel for Herre Bros.. although the contents of Exhibit E appear to be that which was conveyed under cover of December 8, 1997, 7 . . It should also be noted that accompanying the December 8, 1997 cover letter was a "proposed settlement agreement and release." By its mere title, this draft contemplated an exchange between counsel for the parties. This is not unusual, considering that Messrs, Grimm and Keller had agreed to certain points without the aid of their attorneys, but neither were hardly in a position to draft a legal document or agree to.alJ terms required in a settlement agreement. S<< Grimm Affidavit, Ex. A. It should also be noted that no money was to change hands, nor could terms of the negotiation be enforced until there was a signed Release and a signed copy of the Settlement Agreement. 12. Denied. Counsel for Keller's self-serving and subjective analysis of the document sent by counsel for Herre Bros. on December 18, 1997 is denied in its entirety. As can be seen from Exhibit F, admittedly a true and correct copy, there were several changes which were mentioned in the December 18, 1997 letter. Counsel for Keller improperly takes it upon himself to label them Mmaterial" and "minor." In fact, counsel for Keller agreed to and incorporated three of the four suggested changes, which he conveniently labels "minor.. The time limitation is labeled "material" by counsel for Keller, however, it is no more or less important than the other terms mentioned in the December 19 letter which were subsequently incorporated into the draft agreement without prior discussion by Messrs. Grimm and Keller. The exchanges by counsel were the "give and take" of settlement negotiations, not "refmements." Counsel for Keller 8 ,/ ... accepted those terms which were agreeable to his client and rejected those which were unagreeable. No settlement had been reached at this point. It is furthermore denied that a time limitation of 18 months had not been discussed by the parties on November 26, 1997. As stated in the Affidavit of Edward Grimm attached hereto, and confirmed at paragraph 7 of George Keller's Affidavit, attached hereto as Exhibit B, the time limitation had been discussed, and Mr. Grimm perceived that it had been agreed upon by Mr, Keller. The 18-month time limitation was a reasonable time offered by Herre Bros" although, originally, Mr. Grimm had requested that both parties complete the payment by December, 1998. It is furthermore denied that any of the correspondence between counsel for Keller and Herre Bros. was Mconfirming the terms of settlement reached between the parties. M The correspondence exchanged between counsel for Herre Bros. and Keller only reflected the preliminary negotiations between the parties and did not reflect agreement on each and every portion of the Settlement Agreement. as evidenced by the changes requested by Herre Bros, which were subsequently illCorporated by counsel for Keller into the draft settlement agreement. 13. Denied as stated. Counsel for Keller called counsel for Herre Bros, and advised that he believed the 18 month time limitation was not a term of the settlement which should be included in the Settlement Agreement and Release. Counsel for Ilerre Bros. stated to counsel for 9 , ~ Keller that a time limitation would have to be included in any settlement. The settlement was still in its negotiating phase. No actual settlement has been consummated. It is admitted that the letter attached as Exhibit G to the Motion is a true and correct copy of counsel for Herre Bros.' letter. The letter spealcs for itself. Counsel for Keller's subjective and self-serving interpretation of the letter is denied. 14. Counsel for Keller's subjective and self-serving analysis of the December 26, 1997 letter is denied, as the letter speaks for itself, The existence of a discussion pertaining to a time limitation being discussed by Messrs. Grimm and Keller may not be included in the December 26, 1997 letter, but it is included in a letter from counsel for Herre Bros. to counsel for Keller dated December 31, 1997, a copy of which is attached hereto as Exhibit C. which counsel for Keller failed to disclose in his Motion. Mr, Grimm also states in his Affidavit (Ex. A hereto) that in subsequent conversations with Mr. Keller, Mr, Keller even acknowledged discussion of the time limitation, but the reason Mr. Keller would not include a time limitation was based strictly on the advice of his attorney, and not based on any of the discussions between the parties, In any event, as discussed in preceding responsive paragraphs, settlement was always contingent upon an executed copy of a Settlement Agreement and Release acceptable to both parties. It was never the intention of either party to have a settlement of the case without a document which was to be drafted by the attorneys. 10 . ~ By way of further reply, where no time element is placed in a contract, the law implies that performance of the contract must be completed within a reasonable period of time, based on the intentions of the contracting parties. Gloeckner v. Baldwin Twp. Sch Dist.,405 Pa. 197,201, 175 A.2d 73, 76 (1961); K~ystone Ban1c v. Nuclear Ma~netic Resonance Specialties. Inc., 243 Pa. Super, 471, 477, 366 A.2d 251, 253 (1976). Therefore, since time is an essential element to every contract, it was nol unusual for time to be discussed between attorneys and in the course of negotiating a settlement document. Counsel for Keller refused to even discuss the legal requirement of time and 1cnowingly attempts to enforce an agreement which does not contain an essential term. 15. It is admitted that .counsel for Keller revised the Settlement Agreement and Release", thereby ac1cnowledging that the two parties were still negotiating substantive terms of the Agreement. Counsel for Keller's subjective and self.serving classification of the changes as . minor refmements. is improper. We incorporate our answer to paragraph 12 by reference. It is admitted that Mr. Keller signed the document attached as Exhibit H and that his attorney delivered the document with a certifIed check in the amount of $7,000 to counsel for Herre Bros. It is denied that the document which was received by counsel for Herre Bros. was a final copy of the Settlement Agreement and Release. Tbere was no Settlement Agreement agreeable to Herre Bros. Once again, counsel for Keller has attached as Exhibit II an unsigned 11 . , document which is not the "true and correct copy" of the letter received by counsel for Herre Bros., although the substance of the letter appears to be similar to the one received by counsel for Herre Bros, By way of further reply, counsel for Keller sent the document to Herre Bros. attached to Defendant's Motion as Exhibit H, knowing that Herre Bros.' position was that no settlement had been reached. 16. It is admitted that counsel for Herre Bros. returned the draft of the Settlement Agreement and Release and the check since no settlement had been reached at that time. It is denied, however, that counsel for Herre Bros. "refused to honor the settlement, now contending that no settlement had been reached," Counsel for Keller sent over the document and cenified check knowing Herre Bros. had not agreed to terms of settlement. This was not something that counsel for Keller only then became aware of, but was something of which he had been advised on rwmerous occasions for about one full month. In his Motion, counsel for Keller Ignores the subsequent negotiations which occurred between the panics. Followina the return of the $7,000 cenirled checlc and the document Keller claims to be the final Settlement Agreement and Release, Exhibit H of Keller's Motion. discussions resumed on the settlement. Counsel for Keller next sent a letter dated January 9, 12 . 1998, is attached hereto as Exhibit 0 and incorporated by reference. In that letter, counsel for Keller submitted yet another settlement counterproposal. The subsequent proposal was rejected by Herre Bros, through correspondence dated January 22, 1998, attached hereto as Exhibit E and incorporated by reference. As Mr. Grimm states in his Affidavit, Ex. A hereto, Keller's subsequent proposal was overly complicated. But as another point of concession and compromise, it its January 22, 1998 letter, Herre Bros. proposed to extend the time for payment to 2 years. Counsel for Keller responded with this Motion. While the January 9, 1998 letter claims to reserve Keller's position of a completed settlement, Herre Bros.' January 22, 1998 letter made it clear to Keller that it considered the January 9 letter to be yet another round in the ongoing settlement talks between the two parties, as had all previous correspondence. 17, The allegations of paragraph 17 are legal conclusions to which 110 response is necessary. It is denied that material terms of a bargain were agreed upon in this instance. In fact, the parties had not agreed upon the material element of time. Counsel for Keller refused to even address the material element of time in negotiations. It is furthermore denied that the cases cited by counsel for Keller are applicable to this case. \3 ... 18. The allegations of paragraph 18 contain a legal conclusion to which no response is required. By way of further answer, the cases cited by Keller in support of this proposition are distinguishable on their facts and inapplicable to the present situation. While it may be a general legal proposition that "there is a long standing public policy that encourages settlements", enforcing preliminarY negotiations in this matter will not serve the public purpose of settlement, Since time is an essential element in all contracts, to the extent Keller fails to perform its contractual obligations within a reasonable time, the Court will be called uponJl) iOWOSC a time limitation. Thomas v. Thomas Flex Coup1ine Co., 353 Pa. 591, 597, 46 A.2d 212, 215 (1946). Therefore, there would be no finality to an enforcement of these negotiations. The Court will not ease its docket or promote amicable resolution of disputes, but will only leave open the possibility of yet another round of litigation. 19. Denied. This is an erroneous legal conclusion to which no response is necessary. It is, furthermore, not reflective of the facts in this case. It is black letter Pennsylvania law that if both parties contemplate that a signed Settlement Agreement and Release is part of the contractual agreement between the two, there can be no settlement in the absence of the signed writing. Essner v Shoemaker 393 Pa. 422, 425, 143 A.2d 364, 366 (1958); Schulman v. J.P. MOl'fan Inv Mana~ernent, Inc., 35 F.3d 799 (3d Cir. 1994). In this case, Messrs. Grimm and 14 , Keller reQJlired a signed Settlement Agreement and Release prior to settlement occurring. .s= Edward Grimm Affidavit, Ex. A hereto. 20. Denied. Not all of the material terms of the bargain had been agreed upon. This is reinforced by counsel for Keller's subsequent, post-November 26 incorporation of terms not discussed by Messrs. Grimm and Keller. .Se.c.alm answers to paragraphs 12 and IS, Counsel for Keller ignores the essential term of time in requesting this Court to enforce settlement negotiations which do not include a material term. WHEREFORE, Plaintiff, Herre Bros., Inc., respectfully requests that this Court deny Defendant's Motion to Compel Settlement. Furthermore, Keller's request for attorney's fees should be denied. Keller states that Msettlement terms were agreed to by the parties on November 26, 1997,. and seeks to enforce those terms (See , 20 of Motion), but still makes a demand for attorneys' fees. Attorneys' fees did not enter into the settlement discussions until well after November 26, 1997 (See Exhibit F of Keller's Motion), and were, in fact, a term suggested by Herre Bros, at the same time it brought up the need for a time limitation, 1ncredibly, Keller seeks to use post-November 26 settlement discussions where they are useful, but chooses to ignore those, such as the time limitation. where they are not advantageoUS. Keller's selectivity of terms IS . . , , . ExhlbIt A "1. "'-"-';'-_..._- '-"....~.......... ".._~ +~"- I"-:..-".c ._..,,":,..:a-.. 12, While considerations of time were not always re-hashed by me while discussing monetary terms, this was only because I thought I had initially made clear to Mr. Keller my position on the issue of time. I felt it did not need to be discussed any further. Mr. Keller never objected, nor did he ever bring up the issue of time after my initial contact with him. 13. At all times during my discussions with Mr. Keller, it was always my intention that a Settlement Agreement and Release needed to be signed by both of us, prior to a settlement being consummated. I believed this to be the intention of Mr. Keller as well. Since Mr, Keller and I were not attorneys, yet did part of the negotiating, we did not feel we could address all matters that needed to be included in a valid Settlement Agreement and Release. There was never any discussion of oral settlement agreements, but rather, there always had to be a written Settlement Agreement, prepared by our attorneys and signed by both of us which would bind both of us. 14. After my discussions with Mr. Keller, I informed my counsel of the general monetary terms of the agreement, and furthermore informed him that he should expect a draft of a Settlement Agreement and Release from the attorney for Mr. Keller. IS. At some point after December I, 1997, I was informed by my attorneys of a communication from counsel for Keller. I concurred that the monetary terms contained in that 4 communication were correct, with the added provision that Mr. Keller could pay Herre Bros. greater than $2,000 per installment, if he so desired. 16. I still, at this time, considered that a time limitation would be contained in a Settlement Agreement, prepared by the attorneys, which I understood to be forthcoming and which needed to be signed prior to Herre Bros. and Keller being bound by the terms of the settlement, pursuant to my and Mr. Keller's conversations. 17. I also believed that counsel for Keller's letter only pertained to the monetary aspects of the settlement, and that no settlement would be completed until a signed Settlement Agreement and Release had been consummated. Additionally, I expected to see a time limitation, which Mr. Keller and I had previously discussed, contained in the forthcoming Settlement Agreement and Release. 18. At some point after December 8, 1997, I received a copy of the proposed Settlement Agreement and Release, provided by counsel for Keller, This document is attached hereto as Exhibit B. I noticed that no time limitation was included in the Settlement Agreement, therefore I requested the inclusion of an 18-month time limitation. I also concurred with my attorneys that a default provision should be included in the Agreement and that the initial payment should be in the fonn of a certified check. 1 also wanted to be sure that Keller understood that no future 5 ExhIbIt A .' Exhibit B . @ . '-.,. .-' "::'.~ . SETT~EME~IT AGREE~~~ ~~~ RE:~ASE Th~s Se::lemen: Ag~eement and Release is exec~:ed th~s --- day of Dece~er. 1997. be:~eer. Her~e 9ros.. !nc, wi:h i:5 p~incipal place of business loca:ed a: 4417 Valley Road. ~~ola. c~~e:land Co~~ty, Pe~~sylvania (he:eina:~e: ~He~:e a:05.-) and George A. Keller. t/c/b/a. Keller ~~;ineerir.; Se~,ices. wi:h i:s ~~'~c'~a' ~'ace of b"s'~ess a~ '73 Qa~~ S~~~~- ro~a~v"'~ vo~~ ;:;__.. -z:' . ;:;_ _ -.. l. _ ... -..... Iw___,-, - ':I .. ----, ... ... C~..~~~ =~~~s~lv5~'a (~e~~'~a~-e~ '~e"e~') ...._."".1' "'-.-..1 ,.....- ~. ---.. -'- - '" -- - . WH~R!AS. or. o~ a~ou: . ., 1..2,''': r=~;a:l~~ to.5~~:.a ~ ~ S~~col O~3:=l=:; a~c, Ao:il 16, 1997, Ha~=e 3=05. was :0 provide se~,ices :::l the Sr.rews=ur~1 '~..:~~\S. Keller su;~:ted a proposal in regard :::l p~::l"'idir.g c~::ai~ e~:;~en: to He==e B:~s. ('?=opo5a!-); a~d. ~~~~~S, d~sa;=ee~e~:s arose as to whet~er 0: noe t~e ?~oposa: was ~i:hdra'~ by Keller o~ r~d beer. p~::lper:y ~elied upor. ~e=:e Eros. i~ sub~:ci~; ies bid, res~lci~q in a la~s~:: ~ei~; :~led wi:~ t~e capcion Ee:~e B~os.. !~C. v. Geo=~e ~. ~~11:=, ,...1 I~ I !(a~'o" ':"-C"':"A-~"""- ....."I..c ~../~ ... r.. N"""t't .. :- Q J. ~n the Cou:: 0: Cc~cn ?lea 0: C~~~er:a~c Ccu~:y ('taws~::'); a::.d. WF~~. t~e par:ies wish to reso:ve all r.~::e~s ~ela:ir.g :0 :~e p=cposal a::.d t~e La~sui:. NOW Th~~:OR!. the ea~~ies he:etO, wi:h t~e i~te~: to be :e~ally bo~d ~~d for t~e considera:ior. se~ :o~th below. a~~ae as :oHows: 1. In exchar.~e for Herre 9ros. providing a re:ease to any ~~d all clai~ rela:ive to ~~y mat:ers rela:in~ to the p~oposal 0= the Lawsuit, as set for:h below. Keller will provide a check :ade pay~le to "Herre 3=os.. Inc.," in the amo~~t 0: 57.oao. on o~ before December 31. 1997. In additior.. Keller will pay 52.000 :0 Herre 9r::ls. on each 0: the next five purc~se orders of 5S0.ooo or more that a=e awarded by He~re Bros. to Keller. This will a~re~ate to ar. a~ditional 510.000 being paid by Kalle~ to He==e B=::ls,. providing t~e purchase orders are issued. If Keller ~ishes t::l pay mo~e th~~ 52.000 fo~ a particular pu:c~se o~der. he may do so. The 52.000 is a mini~ paymen:. with any f~ds raid in addition to that amo~~t being applied to the toeal 510.000 payme.''1t. 2, Herre Bros.. Inc.. its assiqns ar.d successors. s~sidiaries ~~d a~er.:s. hereby releases ~~d fo~eve~ discharge Gaorqe A, ~eller. t/d/b/a ~eller Er.gineerinq Services. ~~~ Xeller !~ipmen: Sales, Inc" their respec:ive heirs. successors. assigns, of and from ~~y ~~d all actions. causes of actions. cla~, de=~~, da:~qes. ex;enses. ccr.s~~en:ial ~qes. o~ ~.y o:~.~ cla~ O~ deman~ of ~~y na:u:e wha:soeve=, whet~e: ~cwn O~ un~~owr.. from the beginr.i~g of ti~e to the date of this release. as relates. directly or indirectly. to the ~roposal or the t.a.....sui t. 3. Within ten (10) days 0: reCei7ing an exec~ted copy of this Settlement Agreement and Release. and a check in the amo~~t of $7.000. Herre aros. will file a pr~ecire dis~issing the .~......su;- w'-~ p~c.u~'ce a~~ p~~"'c.'e co..~se. #o~ Ke"c~ '.....'-~ a w.... ...., ........ --J l..io... , ..l..io .....,,,- ........ ..... ---- -.... time-st~ed copy 0: the same. 4. This Set:leme~t Agreement and Release contains the en:i~e a;~ee~en: be:~een the pa::ies, is ccc:~ac:ual i~ ~atu=e, and may not be altered. except i~ wri:i~g. signee by all parties. 5. !: is ~de~s:ood t~a: the sc:e cc~side~a:ion Eor t~is A;~e~~ent is as se: fc~:~ above. ~~C e~a: :~e co~side=a:ion cons:i:~:es a fair and reasonable settlement 0: ~~y and all mat:ers as i~dica~ec. 6. I: is ac~~ow:edqed :~a: :~e exec~:io~ 0: c~is ~;~e~~e~: does ::'0: co::.s~i:..:,=e a..~ ac.:nissio~ 0: a..-.y 'Ca.::." bu:. is a neso:ia:ed set:l~en: 0: dis~~:ed clai=~~ . 7. ~~e pa=:ies ~e=eby cer:i:y t~a: t~e :er=s 0: :~is Agre~ent ~~ve been cc~le:ely re~d. are f~:ly ~ders:ocd. have been reviewed bv t~e =es~ec:ive co~~se:, ~d a~e vol~~:a=ily entered i~:o fo: :~e p~:?oses 0: ~king a f~ll and final cocp:omise as sec !o=:h above. 8. To ~~e extent that any disagree~en:s a:ise relative to t~~s A.=ee=e~:, t~ey will be cc~:=o:~ed by c~e laws 0: t~e Commc~weal:~ of ?er_~sylvL~ia. ~ W!~SS WF~~OF. the parties set their h~~cs and seals the date written above, Attes:: Ee==e 5=05., I=c. By: Wi t::.ess : Geor;e A. Keller. InCividuAlly Wi ~'1es I : a.o:;e A_ ~e:ler, ~/d/o/& Keller L~;ir.e.:L'1q Se~Jic.s exhibit C $- . .,. .-... . -~~ . -" ... The additional payment will not be considered part of the purchase order. or in any way be considered by Herre Bros. in deciding whether to award a contract to Keller for which Keller has placed a bid. Nothing in the Settlement Agreement and Release shall be considered as Herre Bros. giving Kellcr prefcrcntial treall1lcnt in any business dealing in which the twO parties are involved. and Hcrre Bros. shall in no way be required to give Keller preferential treall1lent in the awarding of purchase orders in the furure. All dealings between Herre Bros. and Keller have been. and shall hereinafter rcmain, at arms's length. 3. After Paragraph 1, we suggest adding as Paragraph 2: Herre Bros. and Kellcr shall complete the terms described in paragraph 1, above, within eighteen (IS) months of the date of this agrcement. If Keller has not tendered the full amount of 510,000.00 in that time. Herre Bros. may immediately call the entire remaining amount due by notifying Kcller, in writing, that Herre Bros. demands the outstanding balance. Upon receipt of the notice. Keller shall within ten (10) days. deliver the amounts due and owing. ~. After Paragraph 3. we suggcst adding as paragraph~: In the event that Keller defaults in payment of funds d1.:e Herre Bros. under this agreement, either by failing to pay any of the 52,000.00 amounts as required under paragraph 1. or by failing to pay the balance within ten (10) days after receipt of notic: as required in paragraph 2, the release granted by Herre Bros. and descn'bed above in paragraph 2 shall be deemed null and void and Herre Bros. shall be entitled to pursue any rights and remedies available to it under the law and at equity, including an action for breach of contract or negligence, as if no settlement had been reached. and Kellcr waives any right to assert the Starute of limitations as a defense. Herre Bros. shall be entitled to receive from Keller all reasoll3ble costs and fees. including anorneys fees, expended by Herre Bros. to enforce the terms of this Agreement or to pursue recovery in the event action is brought upon default by Keller. Another suagcstion would be that Keller sign a ~ote for $10.000 with a confession of judgment and payments being ac:omplisbed over eighteen (18) months in the manner described above. This would alleviate the need for much of the Iang\l1ge in paragraph .$ above. exhibit 0 (!)- , '" ,~..,-^ -,.... - - " MlATlot ~ ALLIN N. DAVID ""'MAL. wn.L'AM C. MILLC", ...... CHAIIt\.IS .. "'UICNDALL D I'CII."T I.. WI.LOOH CUGINI. I.. .I~N.KY. "'... TMO...... I.. WOOO ...OMN H. INOI m GA."y I. '.INCH DOHNA S. wll.OC)H .....0'0..0 OOIltIltANCI ..I1'''''r' s. aTO..,IS lItOllltT lit. eMU"eM STI~IH '- GItCSI lit. SCOTT .HUIIIC" WAYHE M. _ceMT DONALD "". LEWIS m ."IOGIT M. WHITLEY MIltIN l"OTlotllltS MAY ."INOA S. LYNCH SHAWN W wl15 KEEFER WOOD ALLEN & RAHAL, LLP 210 WAL.NUT STREET P. O. BOX 11963 HARR~BUR~PAI~oe~963 .....ONE (717) 255.8000 ....x (717) 255.8050 15T...I..15"10 IN '178 0' COUNSIL. WIl..I.I..... .... WOOD .....UIL C. HAA"Y WIST SHO"I O''''CI .IS 'ALLOWrlILCI "0..0 c:,.\""P HILL. ftA .7Qu IIN NO 23.0'7115135 January 9, 1998 ....ONI. ('7171 812-S'00 "... 1117) 811-580S .1It1~lIIf. OIlIlICT Ot"~ 255-8052 Steven E. Grubb, Esquire Goldberg, Katzman' Shipman P.C. 320 Market Street PO Box 1268 Harrisburg PA 17108-1268 Re: Herre Bros, , Inc, v. George A, Keller, t/d/b/a Keller Engineering Services Civil Action 97-3987 Court of Common Pleas of CUmberland Countv Dear Steve: F,:rl:''':t:"'' ,.., of lit 'I"::"f'it " ~:) Your position is that there is no settlement in this matter and our position is that there is a settlement as set forth in the Settlement Agreement signed by my client. I provide you with a copy ot a recent opinion by Judge Turgeon on this issue for your review. Without prejudice to either of those respective positions, I agreed to address the issue of a time limitation on the payment of the additional $10,000 ($2,000 on each of five (5) jobs) with my client. He has recommended the following as a resolution of the impasse. The additional $10,000 would be paid within a 24 month period, $1,000 on each job for ten (10) jobs of $25,000 to $50,000, or $2,000 on each job for five (5) jobs in excess of $50,000, These would be minimum payments tor such jobs. It atter 24 months, a total of $10,000 has not been paid, ~ my client had received six (6) or more jobs of $25,000 to $50,000 or tour (4) or more jobs of more than $50,000, then he would be required to pay the balance of the $10,000. If, however, my client had received five (5) or fewer jobs of $25,000 to $50,000, or three (3) or less jobs of more than $50,000, then he would pay only one-half ot the balance remaining on the $10,000, An example would be as follows: If my client received, over the next 24 months from the date of a new settlement agreement, six (6) jobs over $25,000 but not more than $50,000, he would have paid $6,000 on the $10,000, After the 24 month period, the balance remaining would be $4,000 and since my client would have @- the initial telephone conversation. I advised Mr. Grimm that the offer set fonh in their letter dated November 14. 1997, was unacceplable. I offered a tOlal of $15.000 overthe ne.,t live (S) jobs of SSO.OOO or more. indicating to ~lr. Grimm that my increase from S5.000 to $15.000 was based upon my ability to obtain these five (S) jobs, 7. ~lr. Grimm advised that he wanted a total of $20.000 but that he would extend the time period from 12 months to 18 months to pay the remaining SI5.ooo. I indicated that was unacceptable. 8. I then offered $5.000 cash now and S IS.000 upon receipt of five (S) jobs of $50.000 or more. Mr. Grimm advised that he would accept S10.ooo cash now and $10.000 over the next fiv'e (5) jobs of S50,ooo or more. No time limitation was discussed. I indicated I needed to think about his offer. 9. I called ~Ir. Grimm later that same day and advised ~Ir. Grimm that the "magic number is S7,ooo." which I agreed to pay before the end of 1997, with $ 10.000 spread over the next five (S) jobs of S50.000 or more, with a payment of S2.000 on each job. No time limitation was discussed. ~Ir. Grimm suggested that 1 could make more than the S2.000 if I wanted, but only 52.000 on each job was required. I agreed. ~Ir. Grimm agreed. indicating that he wanted to get this matter behind him. 10. There was no mention of the five (S) jobs being within any time fr:une, nor was there any suggestion that the matter was not then settled. I advised ~Ir. Grimm that I would have my attorney prepare a settlement agreement. based on the terms of the settlement we had reached. Mr. Grimm agreed. II. I called my counsel. advised him of the terms of settlement and told him to prepare a settlement agreement. He advised that we should first confirm the terms of settlement in writing. As a result. my counsel forwarded a letter to counsel for Herre Bros.. setting fonh the terms of the settlement reached by Mr. Grimm and me on No\'ember 26, 1997. A copy of that letter is att:lched to the Motion to Compel as Exhibit "C". 12, On December S. 1997,1 received a telephone call from my counsel advising me that counsel for Herre Bros. confirmed the terms of the settlement as I had relayed them, but requested that we also put in the fact that the 52.000 payment was a minimum payment and that I could pay more on any of the five (S) jobs if I so desired. My counsel forwarded me a copy of the letter he received from Herre Bros.' counsel dated December~, 1997, which is :lttxhed as E.,hibit "0" to the Motion to Compel. 13. After receipt of that letter. [ authorized my counsel to prepare the Settlement Agreement and RelCllSe based upon the terms of settlement rexhed with Mr. Grimm on November 26, 1997, (and confirmed in writing) and forward it to Herre Bros. 'counsel. He did so under cover letter dated December 7, 1997. See E.,hibit "F'to the Motion to Compel. 14. On December 19, 1997,1 received a telephone call from my counsel indicating that he ~ received a letter from Herre Bros.' counsel, wherein they requested several minor refinements to the Settlement Agreement and Release. but in addition. requested that an 18 month time fr:une be plxed upon the ~yment of the 510.000 from the the (S) jobs. without any JU3I'3Illee of recehing five (S) jobs within that time fratne. This was a material chanae in the . , . . "J . ".. \!, exhibit 0 '":"~""-:."'-- "~~'''''.-- -.. .. .. totEATtot !,.. ALLEN N DAVID RAMA!,. WILLIAM E. "'IL.!"ER. ..I" Cl-tARLES W RUBENOA!,.!,. 11 FlO.ERT L. WEL.DON EUGENE E. PEPINS~Y. JR TI10M"S E. wOOO JOHN M. ENOS m G..RY E ""ENCH DONNA I WEL.DON I""O"ORO DORR"NCE JE"""EY S. ITOKES "OBERT lit CHURCH STEPHEN I.. GlltOSE R. seOTT SME..RER WAYNE M PECHT ooN"1..0 M L.EWII m IRIDGET M. WHITL.EY M.A"EN BROTMERS M"Y I"ENOA S L.YNC~ S)04"WN W WE.S KEEFER WOOD ALLEN & RAHAL, LLP 210 WALNUT STREET P,O, BOX 11963 HARRISBURG. PA 17108'1963 ""'ONE (717) 2SS.eOOo ....X (717) 2SS.eOSo EST"ISL.15MEO IN 11S71S 0" COUNSEL. WIL.l.IA'" ... WOOD SA"'UEL. C .....RRY WEST SMORI o,.,..el. .IS ""L.L.OW"I[I.O ROAO CAMP MIL.L.. PO" 17011 [IN NO 23.0716135 January 9, 1998 PO"'ONE 17171 eli-SISOO "AX (717) 612-5805 lIlfIltITE"S DIIICCT D'_I.. 255-8052 steven E. Grubb, Esquire Goldberg, Katzman & Shipman P,C. 320 Market Street PO Box 1268 Harrisburg PA 17108-1268 Re: Herre Bros., Inc, v. George A. Keller, t/d/b/a Keller Engineering Services Civil Action 97-3987 Court of Common Pleas of Cumberland Countv Dear Steve: ,"",,~,...,t-.,.~!",: 11" . .. 1,.....':t i.-' . Your position is that there is no settlement in this matter and our position is that there is a settlement as set forth in the Settlement Agreement signed by my client, I provide you with a copy of a recent opinion by Judge Turgeon on this issue for your review. Without prejUdice to either of those respective positions, I agreed to address the issue of a time limitation on the payment of the additional $10,000 ($2,000 on each of five (5) jobs) with my client. He has recommended the following as a resolution of the impasse. The additional $10,000 would be paid within a 24 month period, $1,000 on each job for ten (10) jobs of $25,000 to $50,000, or $2,000 on each job for five (5) jobs in excess of $50,000, These would be minimum payments for such jobs, If after 24 months, a total of $10,000 has not been paid, ~ my client had received six (6) or more jobs of $25,000 to $50,000 or four (4) or more jobs of more than $50,000, then he would be required to pay the balance of the $10,000, If, however, my client had received five (5) or fewer jobs of $25,000 to $50,000, or three (3) or less jobs of more than $50,000, then he would pay only one-half of the balance remaining on the $10,000, An example would be as follows: If my client received, over the next 24 months from the date of a new settlement agreement, six (6) jobs over $25,000 but not more than $50,000, he would have paid $6,000 on the $10,000. After the 24 month period, the balance remaining would be $4,000 and since my client would have