Georgia Supreme Court Concludes Pre-Suit Offer Under O.C.G.A. § 9-11-67.1 Can Condition Acceptance of Offer Upon Performance of Timely Payment
Last month, the Georgia Supreme Court held that a party can condition acceptance of a pre-suit offer made under O.C.G.A. § 9-11-67.1 upon the timely payment of the consideration demanded. Grange Mut. Ins. Co. v. Woodard, No. S16Q1875 (Ga. March 6, 2017). Under the foregoing statute, prior to filing a suit, any offer to settle a claim arising out of an accident involving a vehicle, shall be in writing from an attorney, or with the assistance of an attorney, and must contain the following material terms: (1) time period in which the offer must be accepted, no less than 30 days; (2) the amount of payment; (3) the party or parties the claimant will release if the offer is accepted; (4) the type of release that the claimant will provide; and (5) the claims to be released. O.C.G.A. § 9-11-67.1(a).
In Grange Mut. Ins. Co. v. Woodard, plaintiffs/claimants made a pre-suit offer to defendant’s insurer under the foregoing statute, arising out of a car accident. Plaintiffs conditioned acceptance of the offer upon timely receipt of the payment of policy limits. On behalf of its insureds, Grange Mut. Ins. Co. accepted the terms. Due to errors in addressing the checks properly, the payment was not received by plaintiff’s counsel before the deadline imposed by the pre-suit offer. Consequently, the plaintiffs rescinded their offer. The insurance company then sued in Federal Court to enforce the terms of what it believed was a binding contract. Upon the denial of Grange’s motion for summary judgment, it appealed and the 11th Circuit Court of Appeals then certified a number of issues to the Georgia Supreme Court. The primary question certified was whether Plaintiffs’ offer under the statute could condition acceptance upon the timely delivery of consideration even after Grange agreed to all the terms in the offer and to pay timely the amount demanded.
In a majority opinion, the Georgia Supreme Court held that O.C.G.A. § 9-11-67.1 “permits ‘unilateral’ contracts whereby Pre-Suit Offers may demand acceptance in the form of performance (in addition to the statutorily mandated written acceptance) before there is a binding enforceable contract.” Id. at *22. Likening the Pre-Suit Offer to any contract, the Supreme Court determined that a party can include a timely payment demand as a condition for acceptance as long as the offer contains, at least, the five elements in the statute. Id. at *15. The statute does not prohibit additional terms outside the five prescribed. Id.
In light of the foregoing, any Pre-Suit Offer should be handled with care and diligence. If you or your clients have any questions or issues arising from O.C.G.A. § 9-11-67.1, please contact Clinton Fletcher of any of the other attorneys at Nall & Miller, LLP.
Clinton F. Fletcher, Esq.