USCA1 Opinion
June 24, 1994 [NOT FOR PUBLICATION]
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
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No. 93-2375
WAYNE SAWYER,
Plaintiff, Appellant,
v.
TOWN OF ASHLAND, NEW HAMPSHIRE,
Defendant, Appellee.
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APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
[Hon. Martin F. Loughlin, Senior U.S. District Judge]
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Before
Selya, Circuit Judge,
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Bownes, Senior Circuit Judge,
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and Boudin, Circuit Judge.
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Peter S. Smith, Disabilities Rights Center, Inc., with whom
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Ronald K. Lospennato was on brief for appellant.
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David P. Slawsky with whom Russell F. Hilliard and Upton, Sanders
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& Smith were on brief for appellee.
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BOUDIN, Circuit Judge. Wayne Sawyer, the plaintiff
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below, appeals from the district court's determination that
his claims against the Town of Ashland for damages and
attorneys' fees were barred by an oral settlement agreement
entered into at an unrecorded pretrial conference. The issue
is difficult but turns primarily on the facts. We conclude
that the agreement discharged Sawyer's damages claim against
the Town, and thereby eliminated any basis for an award of
attorneys' fees. Accordingly, we affirm the judgment of the
district court.
The present litigation arose out of efforts to place
Sawyer in a sexual offender treatment program following his
conviction for felonious sexual assault. Sawyer has been
diagnosed as suffering from a number of developmental
disorders, including mild mental retardation. In July 1990,
the state court sentenced Sawyer to serve three and a half to
fifteen years in New Hampshire state prison but recommended
that he be treated in accordance with his disabilities. In
keeping with this suggestion, the court on December 20, 1991,
deferred the balance of Sawyer's prison sentence so that
Sawyer could enroll in a newly developed community-based
treatment program for developmentally disabled persons with
sexual disorders.
After three months in the program, which was operated by
the Lakes Region Community Services Council ("the Council"),
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Sawyer was charged with violating his probation and returned
to state prison. The state court authorized Sawyer's return
to the treatment program in August 1992, and arrangements
were made to place Sawyer in a new residential treatment
facility in Ashland, New Hampshire. Plans to open the
Ashland facility, however, were ultimately cancelled as a
result of public protest. Because Sawyer's slot in his
previous treatment program had been filled in his absence,
Sawyer was left with no alternative but to remain in state
prison.
On June 25, 1993, Sawyer filed suit in federal district
court against the Council, the New Hampshire Division of
Mental Health and Developmental Services ("the Division"),
and the Town of Ashland. Sawyer's complaint alleged that the
failure to open the Ashland treatment facility deprived him
of his civil rights under the Fair Housing Act, 42 U.S.C.
3601 et seq., the Rehabilitation Act of 1973, 29 U.S.C.
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794, and the Fourteenth Amendment. At an initial pretrial
conference on September 16, 1993, the district court urged
the parties to explore settlement of the case. At a second
pretrial conference on September 30, counsel for the
defendants proposed a residential placement and treatment
plan for Sawyer.
Although the parties differ as to exactly what was said
and understood at the September 30 conference, the
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defendants' counsel and the court came away thinking that the
case had been settled. On October 6, 1993, the defendants
sent Sawyer's counsel a proposed "Stipulation for Dismissal"
articulating the residential treatment plan discussed at the
September 30 conference and also incorporating provisions for
nondisclosure of the agreement and waiver of attorneys' fees.
Sawyer's counsel objected to the latter two provisions--which
everyone agrees were not discussed at the September 30
conference--as well as to certain provisions for Sawyer's
treatment program. Accordingly, Sawyer's counsel returned to
the defendants a "redrafted settlement agreement," which
addressed the development and implementation problem,
eliminated the nondisclosure provision, and provided that
Sawyer's "claim for attorney's fees shall be addressed
separately in a stipulation or other filings with this
court."
In turn, counsel for the Council informed Sawyer's
counsel that the Council and the other defendants believed
Sawyer's claim for attorneys' fees or other relief to be
precluded by the oral agreement reached at the September 30
conference. When the parties met with the district court on
October 25, 1993, Sawyer's counsel pointed out that
attorneys' fees had not been discussed at the prior
conference, and also said that he had never intended to reach
an oral settlement agreement at that conference. The
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district court scheduled a hearing for November 15 to resolve
the fees issue.
Prior to the November 15 hearing, Sawyer, the Council
and the Division agreed to a final "Consent Order Approving
Settlement," which provided more detailed standards governing
Sawyer's treatment program and included $500 each from the
Council and the Division to cover a portion of Sawyer's costs
and attorneys' fees. Because the Town of Ashland was not a
party to the consent order, the November 15 hearing went
forward to determine whether Sawyer was entitled to pursue
his claim for attorneys' fees against the Town. On November
29, 1993, the district court entered an order concluding that
the case had been settled at the September 30 conference,
that the settlement did not include any provision for
attorneys' fees, and that the plaintiff was now precluded
from seeking such an award. Sawyer now appeals from this
ruling.
The district court found that the agreement by Sawyer's
counsel to a comprehensive resolution of the case at the
September 30 conference barred any subsequent claim for
attorneys' fees. However, parties do sometimes settle the
merits of a case but leave the issue of attorneys' fees open
for either later agreement or determination by the court.
Accordingly, courts have generally demanded evidence either
that the parties intentionally waived fees or made an
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agreement that definitively terminated all claims including
attorneys' fees. See, e.g., Muckleshoot Tribe v. Puget Sound
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Power & Light Co., 875 F.2d 695, 698 (9th Cir. 1989); Elmore
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v. Shuler, 787 F.2d 601, 603 (D.C. Cir. 1986).
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In this case, both sides appear to acknowledge that the
only issue actually discussed at the September 30 conference
was relief on the merits. Absent affirmative evidence that
Sawyer's counsel intended to waive their fees at the
September 30 conference, it might be easy to conclude that
counsel were simply looking to the interests of their client
first before addressing their own payment. We need not
resolve this issue because we think that the attorneys' fees
claim is barred even if it was not deliberately relinquished
on September 30.
The problem for Sawyer arises from the district judge's
finding that the parties settled the underlying merits of the
case. Fees are available under section 1988 only to
"prevailing parties," Farrar v. Hobby, 113 S. Ct. 566, 572
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(1992), and the fact "[t]hat a plaintiff has prevailed
against one party does not entitle him to fees from another
party . . . ." Kentucky v. Graham, 473 U.S. 159, 168 (1985).
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Here, it is undisputed that the Town of Ashland "consistently
had refused to do or not do anything to satisfy Wayne
Sawyer's demands, [and] also refused to offer anything to
settle the case . . . ." Sawyer therefore has not yet earned
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prevailing party status vis-a-vis the Town, and can only
retain a claim for attorneys' fees if he also retains a
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viable claim against the Town for substantive relief on the
merits.
Sawyer argues that he retains a claim for damages or
other relief against the Town despite his settlement of his
claims for damages and injunctive relief against LCRSC and
the Division. However, after the fee dispute arose, the
court held a conference on October 25 at which the parties
presented their views of what had transpired on September 30;
on the basis of this conference, the court found that "it was
clear to the court as a result of the statements made by the
parties, that all substantive issues had previously been
resolved by the parties . . . ." The court also noted that
"[t]he determination that the parties had in fact reached a
settlement agreement comes from observations made by the
court during the course of three settlement conferences."
The district judge's findings on this fact-intensive
issue are entitled to substantial deference on appeal. See
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Fed. R. Civ. P. 52(a) (factual findings of trial judge may be
set aside only if "clearly erroneous"). This presumption
becomes even more formidable where as here the court's
findings concern the content of negotiations conducted in the
presence of the district judge.
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The district court's findings are supported by letters
and affidavits from defense counsel, which confirm the
defendants' understanding that the case had been settled at
the September 30 conference. And although neither the
court's nor defense counsel's recollections allude to any
discussion of relief beyond establishment of a treatment
program for Sawyer, Sawyer's own counsel acknowledged at the
November 15 hearing that "I told [defense counsel] that if we
could get a program for Wayne, that the damages aspect of
this case would not be pursued."
Sawyer's counsel continue to insist that they never
intended to enter into a binding agreement at the September
30 conference. But it is hornbook law that the parties'
intent must be determined based on objective standards,
rather than on their subjective, unmanifested states of mind.
See, e.g., 1 Farnsworth on Contracts 3.6, at 169-70 (1990).
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We thus find no clear error in the district court's finding
that the September 30 conference resulted in a settlement
that included a release of Sawyer's damages and other merits
claims in return for placement in a treatment program.
Sawyer argues that any agreement with the Town reached
at the September 30 conference is unenforceable for three
reasons. First, Sawyer contends that the agreement is not
binding vis-a-vis the Town because the Town provided no
consideration as part of the settlement. Absent a showing of
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any contrary authority, we think that the controlling issue
was whether the agreement as a whole was supported by mutual
consideration. Here, Sawyer bargained for and received an
agreement to place him in a residential treatment program.
This was sufficient consideration to render the settlement
agreement effective.
Second, Sawyer asserts that the oral agreement was not
enforceable because the parties did not intend to be bound
until that agreement was reduced to writing. See generally 1
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Farnsworth on Contracts, 3.8, at 178-86. He provides,
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however, no evidence of this beyond the subjective intentions
of his counsel as articulated in a post hoc affidavit. As we
have noted above, however, such intentions cannot overcome
the district court's finding that the objective behavior of
the parties at the September 30 conference manifested an
intent to be bound by the oral agreement.
Finally, Sawyer argues that the oral agreement cannot be
enforced because the parties failed to reach agreement on all
material terms--specifically, because the issue of attorneys'
fees had not yet been resolved. Our recognition that parties
often settle the merits of a case while leaving the fee issue
for later disposition cuts both ways. Even if we accept
Sawyer's position that fees were a separate issue in this
case, Sawyer is still left with the district court's finding
that the merits were definitively settled. As already
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explained, that leaves Sawyer with no basis for claiming
attorneys' fees under section 1988.
Affirmed.
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