SECOND DIVISION
DOYLE, P. J.,
DAVIS and WHITAKER, JJ.
NOTICE: Motions for reconsideration must be
received no later than 4:30 pm on the 10th day after
the decision was issued to be deemed timely filed.
https://www.gaappeals.gov/rules
October 5, 2026
In the Court of Appeals of Georgia
A26A1458. GARZA et al. v. LANDERS.
DAVIS, Judge.
After Felicia Landers and Hector Garza were involved in an automobile
accident, Landers demanded the policy limits from Garza and Francisco Zarate, the
car’s owner, and their insurer pursuant to OCGA § 9-11-67.1. By the deadlines for
acceptance and payment specified in the plaintiff’s demand letter, the defendants
accepted the offer to settle in writing and tendered payment, but they delivered a
required affidavit of no additional coverage after the deadline specified in the demand.
Based on that late submission, the trial court denied the defendants’ motion to enforce
the settlement agreement, concluding that no valid acceptance of the settlement offer
occurred. Because the settlement offer did not make the timely provision of the coverage affidavit a term of acceptance, we disagree with this conclusion. We
therefore vacate the trial court’s order and remand for it to instead consider whether
Landers can validly rescind the contract based on a material breach.
When reviewing a trial court’s order on a motion to enforce a settlement
agreement, “we apply a de novo standard of review and, thus, view the evidence in a
light most favorable to the nonmoving party.” Barnes v. Martin-Price, 353 Ga. App.
621, 623(1) (838 SE2d 916) (2020).
So viewed, the record shows that Garza and Landers were involved in an
automobile collision on November 15, 2024, in Cherokee County, Georgia. On
February 17, 2025, Landers filed the instant complaint against Garza and Zarate.
Garza and Zarate answered the complaint on April 3, 2025.
Garza and Zarate then filed a motion to enforce an alleged settlement
agreement. Attached to the motion, they submitted a demand that Landers made on
April 9, 2025, to their insurer, Home State County Mutual Insurance Company, for
the limits of the policy pursuant to OCGA § 9-11-67.1. Under the heading
“DEMAND,” Landers’ demand letter stated:
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Pursuant to OCGA § 9-11-67.1, this is a time-limited settlement offer that will remain open through and including the date of May 19, 2025. This settlement offer must be accepted on or before May 19, 2025. If this settlement offer is not accepted on or before that date, this offer will expire and be automatically withdrawn.
In compliance with OCGA § 9-11-67.1, Felicia Landers hereby extends a time-limited offer to compromise and settle all bodily injury and personal injury claims against Hector Garza and Francisco Zarate that arise out of this motor vehicle collision in exchange for payment of settlement funds of $30,000 bodily injury and $25,000 property damage policy limits (total $55,000.00) and compliance with the following material terms: . . . . The specified “material terms” included that the demand be accepted in writing and delivered to Landers’ counsel at the firm’s specified physical address or by email to the attorney’s specified email address and that payment of the settlement funds be delivered in a specified manner “on or before May 29, 2025.” The third and final designated material term provided:
Home State County Mutual Insurance Company must provide a
statement under oath confirming that all liability and casualty insurance coverage issued by it that provides coverage or that may provide
coverage for this claim has been disclosed, and that the amount of such coverage are $30,000 bodily injury and $55,000 [sic] property damage. This statement under oath must be delivered to [Landers’s attorney]
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either by delivering it to [the firm’s physical address] or by delivering it
via email to [the attorney’s email address] on or before May 29, 2025.
Landers opposed the motion and submitted email and documentary evidence
showing that, while the written acceptance and payment were timely made, the
affidavit of no further coverage was submitted on June 6, 2025, past the deadline
specified in the offer. Landers also provided an email that she sent to the defendants
wherein she purported to rescind the settlement agreement based on the alleged
material breach by failing to timely provide the coverage statement. Following a
hearing, the trial court denied the motion to enforce, concluding that by failing to
provide the coverage statement within the deadline, the defendants failed to meet all
the conditions to accept the settlement agreement. We granted Garza’s application
for interlocutory appeal.
1. The defendants first contend that the trial court erred in failing to find that
Garza’s timely acceptance of Landers’s demand resulted in an enforceable settlement
agreement. We agree that the trial court erred by finding that the failure to provide a
coverage affidavit by the deadline specified in Landers’s demand constituted the
non-occurrence of a “condition of acceptance.”
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[W]ell-established principles ... guide our inquiry into whether the
parties entered into a settlement agreement. Specifically, in order to
prevent litigation, compromises of doubtful rights are upheld by general
policy. But courts are limited to enforcing those terms upon which the
parties themselves have mutually agreed. And apart from such mutual
agreement, no enforceable contract exists between the parties. In fact,
settlement agreements must meet the same requirements of formation
and enforceability as other contracts. Thus, an answer to an offer will not
amount to an acceptance, so as to result in a contract, unless it is
unconditional and identical with the terms of the offer. Indeed, the offer
must be accepted unequivocally and without variance of any sort, and if
a purported acceptance of the plaintiff’s settlement offer imposes any
new conditions, it constitutes a counteroffer rather than an acceptance.
Finally, the party asserting the existence of a contract has the burden of
proving its existence and its terms.
Importantly, Georgia law holds that an offer may be accepted either by
a promise to do the thing contemplated therein, or by the actual doing of
the thing. And if an offer calls for an act, it can be accepted only by the
doing of the act.
Barnes, 353 Ga. App. at 623-24(1) (citation modified).
Thus, whether a contract was formed in this case depends on the terms of
Landers’ demand, particularly the conditions of acceptance specified therein, and
Garza’s conduct in responding to the demand. The record shows that, by letter dated
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May 1, 2025, Garza “hereby accept[ed] the terms of [Landers’] demand in their
entirety including paying $55,0000 [the combined policy limits] in full and final
satisfaction of any and all injuries or claims associated with the [subject] accident
described in [Landers’] demand letter.” The acceptance letter continued: “As
required by your demand, payment and a statement made under oath by [the insurer]
will be delivered to your office by May 29, 2025. These statements will confirm that
all liability and casualty insurance coverage related to this claim have been disclosed,
as well as the amount of bodily injury and property damage coverage.” Although
Garza requested that Landers fill out a form to determine whether she had Medicare
or Medicaid coverage, the acceptance letter emphasized that “completion of this form
by [Landers] does not change our acceptance” although it would “greatly assist in
ensuring that [she] is paid promptly and correctly.”
The record thus shows that Garza accepted Landers’ post-answer demand,
unequivocally and without variance of any sort, within the time allowed by the offer
and in the required manner. Although Garza concedes that he did not strictly comply
with the terms of the settlement agreement as promised because the insurer did not
provide the coverage affidavit until June 6, 2025, eight days after the deadline, this
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does not change whether the offer was validly accepted. Although Landers’ demand
made timely provision of the coverage affidavit a “material” term, the demand only
expressly made one term a condition of acceptance: namely, acceptance in writing by
May 19, 2025. Indeed, not only did the coverage affidavit requirement not mention
acceptance, the offer stated that “acceptance must be made by May 19, 2025,” yet
included a deadline for the coverage affidavit of May 29, 2025, well after that date the
offer provided for “acceptance.” Therefore, the coverage affidavit requirement was
not a condition of acceptance required by the offer, and the trial court erred by ruling
that there was no enforceable contract on the basis that the insurer’s late delivery of
the coverage affidavit somehow negated Garza’s timely, unequivocal written
acceptance of Landers’ demand.
In response, Landers argues that the defendants had renounced the bilateral
contract requirement of OCGA § 9-11-67.1(a) and that, therefore, the only way for the
defendants to accept the settlement offer was strict performance of the demand.
In interpreting [OCGA § 9-11-67.1], our analysis begins with familiar and
binding canons of construction. And in considering a statute’s meaning,
our charge is to presume that the General Assembly meant what it said
and said what it meant. We must afford the statutory text, then, its plain
and ordinary meaning, consider the text contextually, read the text in its
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most natural and reasonable way, as an ordinary speaker of the English
language would, and seek to avoid a construction that makes some
language mere surplusage. So, when the language of a statute is plain and
susceptible of only one natural and reasonable construction, courts must
construe the statute accordingly.
Gomez v. USAA Cas. Ins. Co., 378 Ga. App. 702, 705-06(1) (926 SE2d 687) (2026)
(quotation marks omitted).
As then-Chief Judge McFadden summarized, after the Supreme Court’s
decision in Southern Gen. Ins. Co. v. Holt, 262 Ga. 267 (416 SE2d 274) (1992),
an insurer that passes up an opportunity to settle a claim within policy
limits can be liable to its insured for a bad faith claim. That rule creates
an incentive, in cases where damages greatly exceed policy limits, for a
plaintiff to attempt to set up a bad faith claim. The General Assembly
addressed that perverse incentive by adopting OCGA § 9-11-67.1. Our
Supreme Court construed that statute in light of “the backdrop of a large
body of law” under which an acceptance is effective only if “the offer
[is] accepted unequivocally and without variance of any sort” because
“an offeror is the master of his or her offer, and free to set the terms
thereof,” and “conclude[d] that the plain language of OCGA § 9-11-67.1
[(2013)] does not expressly or by necessary implication contravene these
common law principles.”
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White v. Cheek, 360 Ga. App. 557, 564 (859 SE2d 104) (2021) (McFadden, CJ,
concurring specially). Originally, OCGA § 9-11-67.1 applied only to settlement offers
for tort claims arising from the use of a motor vehicle that were made prior to the filing
of a civil action and prepared by or with the assistance of an attorney. OCGA
§ 9-11-67.1(a) (2013). Explicitly, nothing in the Code section was “intended to
prohibit parties from reaching a settlement agreement in a manner and under terms
otherwise agreeable to the parties.” OCGA § 9-11-67.1(c) (2013). The statute required
a minimum period in which demands could be accepted before expiring or being
withdrawn and also required pre-suit, attorney-drafted demands to be in writing and
to include, at a minimum, five specified terms. See Grange Mut. Cas. Co. v. Woodard,
300 Ga. 848, 854-858(2)(b) (797 SE2d 814) (2017).
The statute was amended in 2021 to make the statute applicable to demands
“issued before the filing of an answer.” OCGA § 9-11-67.1(a) (2021). The 2021
amendment retained, with a slight rewording, the 2013 version of subsection (c), again
providing that “[n]othing in this Code section is intended to prohibit parties from
reaching a settlement agreement in a manner and under terms otherwise agreeable to
both the offeror and recipient of the offer.” The amendment also authorized, but did
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not mandate, “a term requiring that in order to settle the claim the recipient shall
provide the offeror a statement, under oath, regarding whether all liability and casualty
insurance issued by the recipient that provides coverage or that may provide coverage
for the claim at issue has been disclosed to the offeror.” OCGA § 9-11-67.1(a)(3)
(2021).
The statute was again amended into its current form in 2024, and because both
the car accident and Landers’ demand came after July 1, 2024, the 2024 version of the
statute applies here. See Gabrell v. Hancock, 378 Ga. App. 406, 407 n.1 (926 SE2d 110)
(2026). In the 2024 amendment, the required terms of a pre-suit/pre-answer demand
were re-labeled subsection (b),1 and the following subsection was added: “[a]ny offer
to settle a tort claim for personal injury, bodily injury, or death arising from a motor
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Among other changes, the 2024 amendment required that the statutorily specified material terms be “the only material terms” contained in the plaintiff’s preanswer settlement demand. OCGA § 9-11-67.1(b)(1) (2024). In particular, the amendment made the insurer’s coverage affidavit a mandatory, rather than a permissive, material term and provided the insurer at least 40 days from receipt of the demand to provide the affidavit. OCGA § 9-11-67.1(b)(1)(G) (2024). Because the settlement demand here was provided after Garza and Zarate filed their answers, these provisions of OCGA § 9-11-67.1(b) do not control here. The 2024 amendment also continued to allow settlement agreements “under terms otherwise agreeable” to the parties, with an additional limitation, in what has now been re-designated as subsection (e).
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vehicle collision shall be an offer to enter into a bilateral contract.” OCGA § 9-11-67.1(a). This provision squarely addressed previous cases which held that “OCGA §
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 settlement contract.” Grange Mut.
Cas. Co., 300 Ga. at 858(3) (interpreting OCGA § 9-11-67.1 (2013)). See also Patrick
v. Kingston, 370 Ga. App. 570, 576-78(1) (898 SE2d 560) (2024) (under OCGA §
9-11-67.1 (2013), “an offeror may include terms of acceptance establishing a unilateral
contract, whereby an offer calls for acceptance by an act rather than by
communication.”). For instance, in previous cases, we held that, where the plaintiff’s
demand included the requirement that the settlement payment not “include any
terms, conditions, descriptions, or representations that are not permitted in the
release,” and the insurer’s check indicated on its face that it was “VOID IF NOT
PRESENTED WITHIN 90 DAYS,” the defendant failed to perform an act required
to accept the offer, the parties did not have a meeting of the minds, and no enforceable
settlement agreement was created. Patrick, 370 Ga. App. at 576-78(1). However, under
this new provision, and notwithstanding the requirements of OCGA § 9-11-67.1(b),
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because a settlement demand is now by definition an offer to enter a bilateral – not a
unilateral – contract, a binding contract is generally formed upon acceptance of a
demand, so that an insurer’s failure to fulfill a condition would constitute, at most, a
breach of contract rather than a rejection of the demand. See Jackson Elec. Membership
Corp. v. Ga. Power Co., 257 Ga. 772, 773-74(1) (364 SE2d 556) (1988) (a bilateral
contract is one in which parties create a contract by expressing their mutual intent to
be bound).
Here, Landers argues that the defendants had waived any reliance on OCGA
§ 9-11-67.1(a) by arguing below that it did not apply because the demand in this case
was filed after both defendants had filed an answer. However, we find this argument
ultimately to be unpersuasive because, regardless of whether this was a unilateral or
bilateral contract, the defendants properly accepted because the only act that the offer
called for to effect acceptance was providing the written acceptance letter. Nothing
in the plain text of the settlement demand required full performance of the contract
as a condition of acceptance. Compare Kitchens v. Ezell, 315 Ga. App. 444, 447-48(1)
(726 SE2d 461) (2012) (physical precedent only) (the presentation of a certain bodily
injury release was a condition of acceptance, not merely performance, when the
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contract specified that “if State Farm delivered the bodily injury release, among other
things, within 20 days of the settlement offer, then his clients would sign the release
and the bodily injury claims would be settled.”). Thus, the defendants do not need to
rely on OCGA § 9-11-67.1(a) to support their argument that they properly accepted
the settlement offer.
In summary, the trial court erred by concluding that the defendants did not
validly accept Landers’ settlement offer.
2. The defendants next argue that Landers cannot unilaterally rescind the
settlement agreement based on the failure to timely provide the coverage affidavit.
Because the trial court concluded that the defendants never properly accepted the
settlement agreement, it did not reach the issues of whether the defendants materially
breached the agreement by failing to timely provide the coverage affidavit and, thus,
whether Landers properly rescinded the agreement. And we decline to answer those
questions for the first time on appeal because they may possibly require resolving a
number of disputed factual matters. See McQueen v. Long, 372 Ga. App. 840, 844 (906
SE2d 909) (2024) (“[W]e are a court of review, not of first view.”) (quotation marks
omitted).
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“A party may rescind a contract without the consent of the opposite party on
the ground of nonperformance by that party but only when both parties can be
restored to the condition in which they were before the contract was made.” OCGA
§ 13-4-62. “To justify rescission, there must be a material nonperformance or breach
by the opposing party.” Yi v. Li, 313 Ga. App. 273, 276-77 (721 SE2d 144) (2011)
(punctuation omitted). “A breach is material when it is so substantial and fundamental
as to defeat the object of the contract. ... A breach which is incidental and subordinate
to the main purpose of the contract does not warrant termination.” Forsyth County v.
Waterscape Servs., LLC, 303 Ga. App. 623, 633(2)(b) (694 SE2d 102) (2010)
(punctuation omitted). Whether a breach is material such that rescission is available
is a matter that may potentially need to be resolved by a factfinder. See Lanier Home
Center, Inc. v. Underwood, 252 Ga. App. 745, 745-46(1) (557 SE2d 76) (2001)
(concluding that rescission claim was properly put before a jury to resolve).
Additionally and crucially, under the general contract principles that apply to
most settlement demands, when “time is not of the essence, either expressly or by
construction, the party has a reasonable time in which to perform.” Peachstate Devs.,
LLC v. Greyfield Res., Inc., 284 Ga. App. 501, 504(1) (644 SE2d 324) (2007). See
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OCGA § 13-2-2(9) (“Time is not generally of the essence of a contract; but, by
express stipulation or reasonable construction, it may become so.”). “[W]hat is a
reasonable time is a matter of fact, to be determined by a jury or other factfinder under
all the circumstances of the case.” Peachstate Devs., LLC, 284 Ga. App. at 504(1).
This is true even when the contract provides a deadline to perform. See, e.g., Braddy
v. Boynton, 271 Ga. 55, 55 (518 SE2d 411) (1999) (when time is not of the essence, “the
mere prescribing of a certain time within which [a real estate] transaction shall be
closed does not necessitate a tender of the purchase price within that time.”). Thus,
given the absence of any “time is of the essence” language in the settlement
agreement at issue here, the defendants’ failure to provide the coverage statement
within the specified deadline may not automatically be a material breach as a matter
of law but may potentially instead present a question for a factfinder. Thus, we decline
to address the issue of rescission for the first time on appeal.
Accordingly, we vacate the trial court’s denial of the motion to enforce the
settlement agreement and remand for it to address whether Landers properly
rescinded the agreement.
Judgment vacated and case remanded. Doyle, P. J., and Whitaker, J., concur.
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