State Farm Mutual Automobile Insurance Co. urged the Georgia Court of Appeals on Wednesday to find that a purported $25,000 settlement it reached with a man involved in a crash is enforceable because it accepted all the "material terms" outlined in a state statute related to settling automobile injury claims.

The case involves a motor vehicle collision in March 2023 between Weston Vincent and Carl Eugene Squires, who had automobile insurance through State Farm. The following February, Vincent's counsel sent State Farm a demand letter proposing to release Vincent from personal injury claims in exchange for $25,000 and an agreement that a Georgia statute related to settling automobile injury claims — known as OCGA § 9-11-67.1 — would not govern the offer. State Farm responded by saying it believed the statute did control and that it accepted the terms of the offer to the extent that they consisted of the material terms outlined within the statute.

Vincent asserted in March 2024 that State Farm's response was actually a rejection, though State Farm had already delivered a settlement check and limited release to his counsel. The insurer filed suit, seeking a declaration that there was an enforceable settlement. A trial court later granted Vincent's motion to dismiss, finding the settlement unenforceable because State Farm did not accept all the demand's nonstatutory terms.

Attorney Seth M. Friedman, representing State Farm, told an appellate panel Wednesday that the trial court's holding could not be right under the language of the statute itself.

The 2021 version of the statute "alone governs contract formation in this case," Friedman said, and it plainly provides that "pre-suit demands can only include the material terms in subsection A, unless the parties agree otherwise in writing." And, he said, its subsections provide that "all a recipient has to do [is] to accept the material terms in A, and there is a binding settlement."

State Farm, Friedman argued, did just that. It agreed to all the terms outlined in subsection A of the statute — which essentially says that an offer to settle "shall be an offer to enter into a bilateral contract" — and rejected all other terms. In doing so, he said the insurer followed the "literal text" of the statute, "which created an enforceable settlement." It then sent payment, which he said Vincent later returned.

Judge Christopher J. McFadden asked Friedman if the 2024 Georgia Court of Appeals Redfearn v. Moore  case, which also involved State Farm, applied to the current case. In that case, the court rejected arguments from William Redfearn, who was accused of fatally striking a man who was standing next to his vehicle on a highway's emergency lane, that a binding settlement was reached as soon as he agreed to five material terms set out in OCGA § 9-11-67.1.

Friedman said Redfearn had "materially different facts," and that State Farm agreed in that case that the "actual terms of the offer" controlled, rather than the statute. The court noted that "you can agree to other terms," he said, and the case was "basically decided under the common law."

"There aren't any other cases with these facts, where the insurance company says, 'No, we're not agreeing to these other terms, we're under the statute, this is it, this is all we accept,'" Friedman said. "But under the literal text of the statute, it says there is a binding settlement."

"Because of that, would you agree that we don't have to overturn Redfearn in order to rule for you?" Judge Trea Pipkin asked.

"Agreed, you do not have to overturn Redfearn," Friedman said. "I think it can exist on its own. If you agree that you're under the common law, you can agree to all those terms under the statute and you have to comply with it."

Attorney Ben Brodhead, representing Vincent, argued that Redfearn is "absolutely binding."

"It's surprising they would claim it's not binding or that it's different," Brodhead said, when the Redfearn court found that "failure to comply with the precise terms of an offer generally is fatal to the formation of a valid contract."

In other words, Brodhead argued, the Redfearn court said there was "no merit" in the contention that "accepting the five material terms forms a contract."

"There's no other way around Redfearn other than what it says," Brodhead said. "You can't have an agreement based on a disagreement."

Judge McFadden said he believed a "correct and coherent reading of the statute" seemed to indicate that there are "essential terms that may be included in an offer" and that, "in derogation of common law," the ability to "make a unilateral contract is limited to the acceptance of those five provisions."

Beyond that, the judge said the parties could agree to include other terms, but the "key point is empowering an insurer to accept those five terms regardless of whatever else" may be in the offer.

Brodhead disagreed.

"You're overreading the position that it says they can accept the offer," Brodhead said. "It's not that they can accept the five material terms and bind Mr. Vincent to those terms only. It's not that those immaterial terms in this instance become part of the contract, because they can't."

Subsection A of the statute might define the terms that can be included in a contract, Brodhead said, but "the problem is that there is a condition." There are conditions of both acceptance and rejection in the offer at issue, he said.

"But they didn't agree to go outside the statute," Judge McFadden said.

"Correct, and that's defined as a rejection," Brodhead said.

"You can't require them to go outside the statute," Judge McFadden said.

"You're not requiring them to," Brodhead said. "You're asking for an agreement to go outside the statute."

"And they said no," Judge McFadden said. "So then you're governed by the statute."

"You might be, but you can't force private parties into a contractual agreement when there is no agreement," Brodhead said. "Even if they agreed to the terms, there is a condition precedent to contract formation and that condition precedent is the agreement that there can be additional terms. They said no, and that's fine. They have the right to say no, but that doesn't mean you force a party into a contract they never offered and never agreed to."

Judge McFadden asked Brodhead to explain what, exactly, he thought the statute at issue does.

"It outlines what should be in an offer," Brodhead said. "But it does say the parties can do this in the manner and under any terms and conditions that they want, and that the court's not going to interfere with that."

The National Association of Mutual Insurance Cos. and American Property Casualty Insurance Association filed an amicus brief with the Georgia Court of Appeals arguing that State Farm should win the day because it "agreed to pay its policy limits and accepted the terms of Vincent's offer that the statute allows."

Judges Christopher J. McFadden, Ken Hodges and Trea Pipkin sat on the panel for the Georgia Court of Appeals.

Squires is represented by Matthew D. Friedlander of Webb Daniel Friedlander LLP and Jonathan M. Adelman of Waldon Adelman Castilla McNamara & Prout.

State Farm is represented by Seth M. Friedman, Christopher C. Meeks and Marshall S. Sims of Lewis Brisbois Bisgaard & Smith LLP and Thomas W. Curvin of Eversheds Sutherland.

Vincent is represented by Ben C. Brodhead, Ashley B. Fournet, Orlando P. Ojeda Jr. and Michael Arndt of Brodhead Law LLC.

The cases are Squires v. Vincent, case number A25A2137, and State Farm v. Vincent, case number A25A2138, in the Court of Appeals of Georgia.