Session: November 13, 2014.
[Copyrighted Material Omitted]
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Reversed and Remanded. Direct Appeal from the Chancery Court for Shelby County. No. Ch-13-1491-2. Arnold B. Goldin, Chancellor.
Philip E. Oliphant, Assistant City Attorney, Memphis, Tennessee, for the appellant, City of Memphis.
Darrell James O'Neal, Memphis, Tennessee, for the appellee, Michael Savage.
BRANDON O. GIBSON, J., delivered the opinion of the Court, in which J. STEVEN STAFFORD, P.J., W.S., and KENNY ARMSTRONG, J., joined.
BRANDON O. GIBSON, JUDGE.
In this appeal, we are asked to determine whether an Assistant City Attorney of the City of Memphis was an agent properly authorized to settle a dispute with a former employee. The former employee sued the City to enforce a settlement agreement he purportedly reached with the Assistant City Attorney for an amount in excess of $500.00. His complaint alleged that although he was never informed that the agreement was contingent on the Mayor's approval, the Mayor subsequently rejected the agreement, and the City, based on the Mayor's rejection, refused to honor it. The Memphis City Charter provides that the City Attorney has independent authority to settle claims against the City for amounts less than $500.00, but settlements for amounts exceeding $500.00 must be entered " by and with the approval of the Mayor." After a period of discovery, the City filed a motion for summary judgment contending that the former employee's evidence was insufficient to establish that the Assistant City Attorney acted with authority to bind the City to the settlement agreement. The former employee opposed the City's motion and filed his own motion for summary judgment, in which he argued that evidence established the Mayor either actually or apparently authorized the Assistant City Attorney to enter the settlement agreement. The trial court granted the former employee's motion for summary judgment after finding that the Assistant City Attorney acted with apparent authority to enter the settlement agreement. On appeal, we find that the record does not contain evidence sufficient to establish that the Assistant City Attorney acted with either actual or implied authority to bind the City. In light of our findings, we reverse the trial court and hold that summary judgment should be granted in favor of the City.
I. Background and Procedural History
The facts in this case are largely undisputed. Michael Savage (" Mr. Savage" ) is a former employee of the City of Memphis, Public Works Division. Following the termination of his employment, Mr. Savage initiated legal proceedings against the City of Memphis (the " City" ) claiming that he was disciplined more harshly than a female supervisor. The City's Civil Service Commission (" Commission" ) upheld the termination, and Mr. Savage filed a Petition for Writ of Certiorari in chancery court. The chancery court found substantial and material evidence to support the Commission's decision but remanded the matter to the Commission for specific findings on Mr. Savage's equal protection claims.
On or about July 12, 2012, prior to the hearing on remand, Assistant City Attorney Barbaralette Davis (" Ms. Davis" ), acting with the approval of City Attorney Herman Morris (" Morris" or " City Attorney Morris" ), contacted Mr. Savage to discuss submitting the dispute to mediation.
Mr. Savage agreed to participate in mediation, and the parties agreed that retired Judge Bernie Weinman would serve as the mediator in the case. On July 18, Ms. Davis emailed Judge Weinman and stated, " I would like to know what are your requirements regarding having available someone with the authority to settle so that I can arrange to have someone on hand, if necessary." Judge Weinman responded the following day with an email to Ms. Davis and Mr. Savage's attorney, which stated, " Please have someone with authority to settle at the mediation. It is essential that you have someone available with authority to reach an agreement in the case."
The parties met with Judge Weinman to mediate the dispute on August 2, 2012. Ms. Davis represented the City in the mediation as an Assistant City Attorney. In addition to Ms. Davis, two other City employees participated in the mediation -- Phillip Davis, the Solid Waste Operations Administrator for the Division of Public Works, participated in person, and Dwan Gilliom, the Director of the Division of Public Works (" Director Gilliom" ), participated by telephone. The mediation was successful, and the parties reached an agreement to settle the matter for $72,000. On August 23, Ms. Davis sent a written draft of the settlement agreement to Mr. Savage's counsel. Ms. Davis asked that Mr. Savage sign and return the agreement and advised that, in the meantime, she would " get the ball rolling on getting the check request routed." Mr. Savage agreed to the settlement agreement's terms and signed it. The settlement agreement did not have a space designated for the mayor's signature, nor did it contain any language to indicate that the enforceability of the agreement was subject to the mayor's approval. Nevertheless, the agreement was later submitted to City Mayor AC Wharton (the " Mayor" or " Mayor Wharton" ) for approval. Mayor Wharton testified that he knew nothing about the case until the proposed agreement was submitted to him, and that he rejected the settlement after reviewing it.
Mr. Savage commenced the current lawsuit on October 2, 2013 by filing a " Petition to Enforce Settlement" in Shelby County Chancery Court. Mr. Savage argued that the City was bound by the settlement agreement because Ms. Davis had authority to settle the matter and its terms were agreed on and memorialized in writing. In his supporting memorandum of law, Mr. Savage contended that Mayor Wharton delegated authority to ...