The Dallas Court of Appeals has held that a settlement agreement by Rule 11 did not support summary judgment because the client challenged her counsel’s authority to sign the Rule 11. In this case, a plaintiff settled a case by a Rule 11 Agreement. Later, she brought suit against the same party she had settled with years before. The defendant alleged affirmative defenses based on the Rule 11. The plaintiff filed an affidavit that she had not authorized her counsel to sign the Rule 11. The trial court granted summary judgment for the defendant based on the Rule 11 agreement.
The court of appeals held that while an attorney is presumed to have authority to execute a Rule 11 agreement, the presumption may be overcome with evidence. Note that case law indicates that an attorney’s authority to settle a case may be different than the authority to prosecute or defend. Compare Dunlap v. Villareal, 91 S.W.2d 1124, 1125 (Tex. Civ. App.–San Antonio 1936, no writ) (holding an attorney retained for litigation is presumed to possess authority to enter into a settlement on behalf of a client) with Johnson v. Rancho Guadalupe, Inc., 789 S.W.2d 596, 598 (Tex. App.–Texarkana 1990, writ denied) (noting that there is no implied authority for an attorney to release the very right or interest he is employed to protect). As a result, the court of appeals reversed because the plaintiff filed an affidavit calling into question that attorney’s authority. The court’s opinion in Karle v. Innovative Direct Media Ltd. Co. can be found at this link.