This case arises out of a March 2023 motor vehicle collision involving an accident victim (the plaintiff) and State Farm’s insured (the defendant). The plaintiff’s alleged injuries exceed policy limits. Consequently, State Farm could have been liable to the defendant if it had failed in bad faith to settle a claim within the policy limits based on a time-limited settlement offer by the plaintiff’s attorney.
The question before the Court of Appeals was whether the plaintiff’s claim against the defendant had been settled. The answer to that question is controlled by O.C.G.A. § 9-11-67.1, which regulates offers to settle such claims. This appeal challenges the trial court’s finding that there wasn’t an enforceable settlement agreement under § 9-11-67.1 (2021).
Background
In February 2024, the plaintiff sent State Farm a six-page offer of settlement. The letter stated that the offer wasn’t made pursuant to O.C.G.A. § 9-11-67.1, but was “made pursuant to and governed by common law.” The letter included all of the statutory material terms set out in O.C.G.A. § 9-11-67.1(a), as well as various non-statutory terms. State Farm responded, providing, in pertinent part:
As an initial matter, State Farm’s position is that your offer is controlled by O.C.G.A. § 9-11-67.1, and pursuant to O.C.G.A. § 9-11-67.1(b)(1), State Farm does not agree to any terms of your offer beyond the material terms required by O.C.G.A. § 9-11-67.1(a)(1) and permitted by O.C.G.A. § 9-11-67.1(a)(3).
Pursuant to O.C.G.A. § 9-11-67.1(b)(2), State Farm accepts the terms of your offer in their entirety, to the extent that they consist of the material terms outlined in O.C.G.A. § 9-11-67.1(a).
The plaintiff replied to State Farm’s response by claiming it was a rejection of the offer. State Farm sent him a follow-up letter, explaining that it “considers this matter to have been settled” and including an affidavit of insurance, a settlement check, and a limited release. The plaintiff returned the check, claiming that State Farm’s response to his offer didn’t amount to an acceptance.
In March 2024, the plaintiff filed suit seeking damages for injuries allegedly sustained in the motor vehicle collision. The defendant filed a motion to enforce the settlement agreement, asserting that State Farm and the plaintiff had entered into a binding agreement under O.C.G.A. § 9-11-67.1. The plaintiff opposed the motion, arguing that common law principles, not O.C.G.A. § 9-11-67.1, applied to his offer. The trial court agreed with the plaintiff and denied the motion to enforce, finding that under common law principles, no agreement had been reached because State Farm’s response wasn’t an acceptance of the plaintiff’s offer.
State Farm filed a separate complaint for declaratory judgment, seeking a declaration that there was an enforceable settlement agreement under O.C.G.A. § 9-11-67.1(b)(2) or, alternatively, a declaration that the plaintiff’s offer was invalid under O.C.G.A. § 9-11-67.1(b)(1). State Farm amended its complaint to add a breach of contract claim based on the plaintiff’s rejection of the settlement agreement and a claim for attorney fees under O.C.G.A. § 13-6-11. State Farm moved for summary judgment on all its claims, and the plaintiff moved to dismiss the complaint. The trial court granted the plaintiff’s motion to dismiss the two counts seeking declaratory judgment; it found that those counts failed to state appropriate claims for declaratory relief. In the same order, the court also denied State Farm’s motion for summary judgment as to the breach of contract and attorney fees claims, finding that no settlement agreement had been formed.
The defendant appealed from the denial of his motion to enforce the settlement agreement. He argued that the trial court erred by determining that the parties didn’t have an enforceable agreement under O.C.G.A. § 9-11-67.1. In the related case, State Farm appealed from the trial court’s order denying its motion for summary judgment on its breach of contract claim and granting the plaintiff’s motion to dismiss the declaratory judgment claims. State Farm also argued that the trial court erred in finding that the parties didn’t have an enforceable settlement agreement. Because the appeals arise from the same underlying transaction and involve the same dispositive issue, the Court considered them together.
Court of Appeals Reverses
Presiding Judge McFadden, writing for the appellate panel, said that as the Court of Appeals held in Gomez v. USAA Cas. Ins. Co. (2026), “O.C.G.A. § 9-11-67.1 (2021) applied to ‘any offer to settle a tort claim for personal injury, bodily injury, or death arising from the use of a motor vehicle and prepared by or with the assistance of an attorney on behalf of a claimant or claimants’ made ‘prior to the filing of an answer.'” Here, the offer was extended before an answer was filed. So O.C.G.A. § 9-11-67.1 (2021) applies.
The defendant and State Farm asserted, contrary to the trial court, that the parties did have an enforceable settlement agreement under § 9-11-67.1 and that the defendant’s motion to enforce and State Farm’s motion for summary judgment on its breach of contract claim was due to be granted. The Court agreed because, as explained by Gomez, an enforceable settlement agreement was reached by the parties under O.C.G.A. § 9-11-67.1.
In Gomez, as in the instant cases, the plaintiff made a settlement offer to an insurance company; claimed that it wasn’t governed by the 2021 version of O.C.G.A. § 9-11-67.1 and was instead governed by common law; and included not only the material terms for such an offer as provided by O.C.G.A. § 9-11-67.1(a), but also other terms not provided by that code section. The insurance company maintained that the offer was governed by § 9-11-67.1, accepted only the material terms of the offer in accordance with that code section, and didn’t agree to any terms other than those material terms provided under § 9-11-67.1(a) (2021).
Under those circumstances, the Court held that the settlement offer was governed by O.C.G.A. § 9-11-67.1 (2021), not common law principles, and that a binding settlement agreement was reached upon the insurance company’s written acceptance of the material terms provided by that statute. As the Court explained:
The insurance company agreed in writing only to the statutory material terms of the plaintiff’s offer and rejected any non-statutory terms. And as we recently explained, a recipient can accept an offer under the statutory terms or it can agree to be bound by more terms. If the offeror and recipient both agree in writing to operate under additional terms, common-law principles still apply. But in the absence of such a mutual agreement, extraneous terms are irrelevant to the formation of a binding contract under O.C.G.A. § 9-11-67.1. As a result, a binding settlement agreement was formed under the plain language of § 9-11-67.1(b)(1) and (b)(2) when the insurance company accepted the material statutory terms of the offer in writing. The trial court did not err, then, in concluding that an agreement was reached as to those terms and those terms alone.
Likewise, in this case, the plaintiff’s offer of settlement to State Farm was governed by O.C.G.A. § 9-11-67.1; State Farm agreed to only the statutory material terms stated in the offer and rejected any non-statutory terms; and therefore, a binding settlement agreement was formed under § 9-11-67.1 when State Farm “accepted the material statutory terms of the offer in writing.” As a consequence, the trial court erred in concluding that a binding settlement agreement wasn’t reached as to those material terms and erred in denying the defendant’s motion to enforce the settlement agreement and in denying State Farm’s motion for summary judgment on its claim for breach of that agreement.
In Gomez, the Court of Appeals held, under circumstances similar to those here, that there was an enforceable settlement agreement under O.C.G.A. § 9-11-67.1. So the Court of Appeals likewise held that there was an enforceable settlement agreement here and reversed the trial court’s rulings premised on that erroneous finding — denials of a motion to enforce the settlement agreement and a motion for summary judgment on a breach of contract claim. Squires v. Vincent, 2026 Ga. App. LEXIS 180, 2026 LX 139531, 2026 WL 733496 (Ga. App. March 16, 2026).
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