Bench & Bar September/October 2025

ETHICS CORNER

LEGAL ETHICS BY SHELDON G. GILMAN O ur Supreme Court authorized the creation of an Ethics Hotline which has now been in existence for more than 30 years. This

respond to the email. A few days later, your client advised you that he was no longer willing to settle for the agreed-upon amount, and he further denied making such a demand. You, your paralegal, and the mediator all heard the client’s statement and the opposing party’s verbal acceptance of your client’s demand. You anticipate that the defendant’s lawyer will soon file a motion to enforce the settlement and you seek guidance as to how you are to proceed with your client. In Kentucky, it appears that a settlement agreement will be enforced when there is clear evidence of mutual agreement on all essential terms, even if the agreement is not signed. In the unpublished Supreme Court case of Central Bank v. Gill, 1 a case dealing with the enforceability of a verbally stipulated agreement settling the claims of a dispute, the Court opined as follows: First, we note that settlement agreements, even those not yet reduced to writing, may be found to be enforceable contracts. … Public policy concerns favor the acceptance and enforceability of verbal settlement agreements in order to effectuate the “administration of justice and the prompt dispatch of business ....” Nonetheless, verbal settlement agree ments, like all other contracts, must still demonstrate the requisite contractual elements—offer, acceptance, consid eration, and mutual assent. There is no doubt that a manifestation of mutual assent—also known as a “meeting of the minds”—must be present in order for an enforceable contract to be found. … In fact, a meeting of the minds is “the most essential factor” in determining the existence of a binding contract. … Logically, there can be no manifestation of mutual assent when the full and complete essential terms of the contract are not agreed upon. … Moreover, while it may facially appear that a settlement agreement has been reached, “other facts may show that the manifestations are merely preliminary expressions.” As a result, our inquiry must focus on whether “all the substantial terms of [the] contract have been agreed [to] and [whether] there is nothing left for future settlement ....” 2 Regardless of the legal results emanating from the client’s deci sion and even if there was a “meeting of the minds,” an attorney cannot compel a client to finalize a settlement without his consent. Rule 1.2(a) requires that “A lawyer shall abide by a client’s decision whether to settle a matter.” Thus, as a matter of ethics, even if a client previously gave verbal consent, the client retains the right to withdraw that consent until the settlement is finalized. Further, the

Ethics Corner presents a sample of Hotline opinions for the purpose of illustrating ethical and practical issues that lawyers might face in their everyday practice and how Hotline attorneys may be of help. SCR 3.530 (5) provides that an attorney will not be disciplined for any professional act performed by that attorney in compliance with an informal opinion furnished by the Hotline attorney “provided that the written request clearly, fairly, accurately and completely states such attorney’s contemplated professional act.” In addition to ethics advice, Hotline attorneys will, in many instances, use their years of experience to help the concerned lawyer examine the issue from a practical point of view, and sometimes ask the requesting attorney: “Are you really sure you want to do this?” Hotline attorneys are not permitted to render an opinion on questions of law, about past conduct, about another attor ney’s conduct, about the subject of a pending grievance or a matter that is pending in court. Hotline opinions are not intended to be used as an expert opinion; they are not binding on any court; and do not reflect the opinion of the KBA. Hotline attorneys must retain the caller’s inquiry confidential, but the requesting attorney may waive confidentiality. Copies of Hotline opinions are

sent to the Chair of the KBA’s Ethics Committee for general information regarding the operation of the Hotline, and to determine if it is appropriate for the Committee to consider the issuance of a Formal Opinion. A copy is sent to the Executive Director for statistical informational purposes. Copies are not sent to the Office of Bar Counsel. Hotline mem bers are granted immunity from process and are not available to testify or give an opinion to the court or others in connection with their advice. QUESTION: What should I to do when my client refuses to sign a settlement agreement after the parties verbally agree to settle the case during a mediation?

During a mediation session your client, the plaintiff, made a settlement demand which the opposing party, the defendant, verbally agreed to pay in total settlement of the case. Later that very same day, you sent an email to your client confirming the amount of the settlement but your client did not

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