We have previously looked at issues surrounding the contractual enforceability of settlement agreements.  It is common, perhaps prevalent, for settlement agreements in contentious litigation matters to include a confidentiality provision. A typical example might read as follows:

The Parties acknowledge that the financial terms and conditions are considered CONFIDENTIAL and shall not be disclosed to any third person or entity except (a) with the prior written approval of all parties hereto; (b) to each party’s respective legal counsel and/or accountant; and (c) to such entities as necessary (i) to fulfill such party’s disclosure or other obligations under any applicable law, rule or regulation of any governmental entity, agency or body, (ii) to comply with the Order of any Court of competent jurisdiction; or (iii) to inform fully such party’s accountants and auditors.  All Parties further agree to provide forthwith written notice to the other party of any effort to obtain an Order of Court permitting or compelling disclosure.  In response to any inquiry, the parties will simply indicate that the disputes and differences were resolved amicably.

Some confidentiality provisions are more restrictive, prohibiting the publication even of the fact of settlement.  Such provisions may include penalties, such as liquidated damages or the right to seek injunctive relief, for violation of the confidentiality provision.  Violation of a confidentiality provision by one party may have dire consequences.

The Snay family of Florida may have learned this lesson the hard way.  According to reports from various media outlets, including the Miami Herald, Patrick Snay, former headmaster of the Gulliver Prepatory School, entered into an $150,000 settlement ($10,000 in back wages, $80,000 in settlement and $60,000 in attorneys' fees) with his erstwhile employer of age discrimination claims related to his 2010 ouster.  The settlement agreement contained a strict confidentiality clause:

13. Confidentiality. [T]he plaintiff shall not either directly or indirectly, disclose, discuss or communicate to any entity or person, except his attorneys or other professional advisors or spouse any information whatsoever regarding the existence or terms of this Agreement . . .  A breach . . . will result in disgorgement of the Plaintiffs' portion of the settlement Payments.

This is an unusually harsh penalty, but one which the Florida Third District Court of Appeal has ordered enforced.  As the Court noted:

Only four days after the agreement was signed, on November 7, 2011, Gulliver notified Snay that he had breached the agreement based on the Facebook  posting of Snay’s college-age daughter, wherein she stated: ["]Mama and Papa Snay won the case against Gulliver. Gulliver is now officially paying for my vacation to Europe this summer. SUCK IT.["]

Compounding this error, the elder Snay failed to revoke the settlement agreement despite the fact that the express terms allowed him to do so until November 10, 2011.  Revoking the agreement would have invalidated the settlement and allowed him to proceed with his age-discrimination claims (which might have pressured the school to come to a new accomodation).  In fact, Snay approved a stipulation of dismissal that reserved for the trial court the right to enforce the settlement agreement.  After the case was dismissed, Snay filed a motion to enforce the agreement (or, more specifically, the requirement that he be paid his portion of the settlement proceeds).  Although the trial court found that Snay and his daughter's conduct had not violated the settlement agreement, the appellate court disagreed:

A settlement agreement must generally “be interpreted like any other contract. That is, absent any evidence that the parties intended to endow a special meaning in the terms used in the agreement, the unambiguous language is to be given a realistic interpretation based on the plain, everyday meaning conveyed by the words.” McIlmoil v. McIlmoil, 784 So. 2d 557, 561 (Fla. 1st DCA 2001).
It is axiomatic that the clear and unambiguous words of a contract are the best evidence of the intent of the parties. See Murry v. Zynyx Mktg. Communications, Inc., 25 Fla. L. Weekly D478, 774 So. 2d 714, 2000 WL 201186 (Fla. 3d DCA Feb. 23, 2000). Where contracts are clear and unambiguous, they should be construed as written, and the court can give them no other meaning. See Institutional & Supermarket Equip., Inc. v. C & S Refrigeration, Inc., 609 So. 2d 66, 68 (Fla. 4th DCA 1992). In construing a contract, the legal effect of its  provisions should be determined from the words of the entire contract.
Khosrow Maleki, P.A. v. M.A. Hajianpour, M.D., P.A., 771 So. 2d 628, 631 (Fla. 4th DCA 2000); see Walgreen Co. v. Habitat Dev. Corp., 655 So. 2d 164, 165 (Fla. 3d DCA 1995) (“When a contract is clear and unambiguous, the court is not at liberty to give the contract ‘any meaning beyond that expressed.’” (quoting Bay Mgmt. Inc. v. Beau Monde, Inc., 366 So. 2d 788, 791 (Fla. 2d DCA 1978))); see e.g. Spring Lake NC, LLC v. Figueroa, 104 So. 3d 1211, 1214 (Fla. 2d DCA 2012) (“If a contract provision is clear and unambiguous, a court may not consider extrinsic or parol evidence to change the plain meaning set forth in the contract.” (quoting SCG Harbourwood, LLC v. Hanyan, 93 So. 3d 1197, 1200 (Fla. 2d DCA 2012))).

In this case, the plain, unambiguous meaning of paragraph 13 of the agreement between Snay and the school is that neither Snay nor his wife would “either directly
or indirectly” disclose to anyone (other than their lawyers or other  professionals) “any information” regarding the existence or the terms of the  parties’ agreement.
Because Snay’s deposition testimony that “[m]y conversation with my daughter was that it was settled and we were happy with the results,” establishes a  breach of this provision, the court below should have denied his motion for enforcement of the agreement. The fact that Snay testified that he knew he needed to tell his daughter something did not excuse this breach. There is no evidence that he made this need known to the school or to his or its attorneys so that the parties might hammer out a mutually acceptable course of action in the agreement. Rather, before the ink was dry on the agreement, and notwithstanding the clear language of section 13 mandating confidentiality, Snay violated the agreement by doing exactly what he had promised not to do. His daughter then did precisely what the confidentiality agreement was designed to prevent, advertising to the Gulliver community that Snay had been successful in his age discrimination and retaliation case against the school.

The moral of the story: all parties entering into a settlement agreement would be well advised to read and be certain they understand all of its terms, including in particular the contractual penalties for violating confidentiality provisions. 

Postscript: the sin of telling their daughter of their settlement might have gone unnoticed and unpunished had her Facebook post not been publicized to all 1,200 of her Facebook friends, including presumably many members of the academic community with whom her father had just settled his suit...