The Iowa Supreme Court affirmed a settlement agreement in a personal injury case involving over-the-road trucker Oscar Recio, ruling that his attorney had proper authority to negotiate the settlement despite the plaintiff's subsequent challenge to that authority.
In *Oscar Recio and Maria Recio v. Frederick M. Fridley, D.L. Peterson Trust, Securitas Security Services USA, Inc., and Doe Corporation* (Iowa S. Ct. 2025), the court upheld both the Iowa Court of Appeals and district court decisions that enforced the settlement agreement negotiated by Recio's Texas attorney.
The case stems from a December 7, 2020 incident when Oscar Recio, a trucker from Hidalgo, Texas, stopped his vehicle on the shoulder of an Interstate 80 on-ramp in Adair, Iowa, to make repairs. While Recio was working underneath his truck, Frederick M. Fridley, driving a 2017 Ram utility van as part of his employment with D.L. Peterson Trust, was involved in an incident that led to Recio's personal injury claim.
The central legal question before the Iowa Supreme Court was whether Recio's first Texas attorney possessed the authority to settle the personal injury claim on behalf of his clients. After the attorney negotiated a settlement agreement, the Recios challenged the validity of that settlement, arguing their attorney lacked proper authorization to bind them to the terms.
Justice Waterman, writing for the majority, framed the issue succinctly: "Either Oscar Recio's first Texas attorney had authority to settle his personal injury claim, or he did not." The court was tasked with determining whether the district court erred in finding that the attorney possessed settlement authority and that the Recios were bound by the negotiated agreement.
The case proceeded through multiple levels of Iowa's court system. The Warren County District Court, with Judge Thomas P. Murphy presiding, initially ruled in favor of enforcing the settlement agreement. Importantly, the district court served as the factfinder in this matter, with no objection from the parties, rather than resolving the dispute through summary judgment.
The Iowa Court of Appeals subsequently reviewed the district court's decision and found no error in the lower court's ruling. The Recios then sought further review from the Iowa Supreme Court, challenging both the district court's original order and the court of appeals' affirmation.
In its December 5, 2025 decision, the Iowa Supreme Court unanimously affirmed the lower courts' rulings, with one notable exception. Justice Waterman delivered the opinion of the court, in which all justices joined except Justice Oxley, who filed a dissenting opinion. The majority's decision effectively validates the settlement agreement and confirms that the Recios remain bound by the terms their attorney negotiated.
The case highlights important questions about attorney-client relationships and the scope of an attorney's authority to act on behalf of clients in settlement negotiations. These issues are particularly significant in personal injury cases, where settlement negotiations often occur under time pressure and may involve substantial financial considerations.
The defendants in the case included not only Frederick M. Fridley and the D.L. Peterson Trust, but also Securitas Security Services USA, Inc., and an unnamed Doe Corporation. The involvement of multiple parties, including a major security services company, suggests the complexity of the underlying incident and subsequent legal proceedings.
Representation in the case reflected the interstate nature of the dispute. Christopher P. Welsh of Welsh & Welsh, PC, LLO, based in Omaha, Nebraska, represented the appellants Oscar and Maria Recio. The appellees were represented by Spencer S. Cady of Nyemaster Goode, P.C., in Des Moines, and Daniel R. Sarther of Christensen Hsu Sipes, LLP, based in Chicago, Illinois.
The Iowa Supreme Court's decision reinforces established principles regarding attorney authority in settlement negotiations while providing clarity for future cases involving similar disputes. The ruling suggests that courts will carefully examine the facts surrounding attorney-client relationships and settlement authority, but will uphold agreements where proper authority can be established.
The case also demonstrates the importance of clear communication and documentation regarding an attorney's settlement authority, particularly in cases involving out-of-state attorneys and clients. The fact that this dispute proceeded through all levels of Iowa's court system underscores the significance of these attorney authority questions in personal injury litigation.
For practitioners, the decision serves as a reminder of the critical importance of establishing clear parameters for settlement authority and maintaining proper documentation of client communications regarding such authority. The case may also influence how attorneys structure their representation agreements and approach settlement negotiations in multi-jurisdictional personal injury cases.
While Justice Oxley's dissenting opinion was not detailed in the available court records, the presence of dissent suggests that questions of attorney settlement authority continue to present nuanced legal challenges worthy of careful judicial consideration.