We know that courts are loathe to set aside settlement agreements. But when a judicial opinion starts off this way and you are the defendant, you know you are likely in trouble:
Stephanie Walker, an elderly widow with limited income, was left suddenly homeless when her Charlotte home was flooded with raw sewage from a sewer-system backup. The City of Charlotte offered $45,000 to Walker on the condition that she sign a release of any claims she might have against the City of Charlotte related to the incident. Walker initially protested but, lacking the money to make her home habitable and fearing that she would not survive living in her car, signed the release to pay for emergency repairs.
Walker v. City of Charlotte, No. 25-1334 (Apr. 8, 2026), slip op. at 1.
And sure enough it didn’t turn out well for the City, which was on the losing end of the U.S. Court of Appeals for the Fourth Circuit’s opinion.
The opinion’s epigram quote above describes the situation generally, but we urge you to review the entirety of the decision for the full scale of the city-caused horror. The short story is that Walker (“a widow in her late seventies and lives in Charlotte, North Carolina,” as the court reminded us), had her house flood with raw sewage after a city-operated line backed up.
The city didn’t fight liability, but insisted Walker execute a release before she was allowed to access the city’s “sewer backup” payment system. Even the maximum amount the city was willing to provide did not fully compensate her for the damage to her home so she balked at releasing the city from additional liability. But “six months after the backup, Walker had grown desperate. She was losing her alternate housing and would need to sleep in her car. Her counsel informed Charlotte that Walker was ‘in her late 70s and she won’t last long living in her car.'” Slip op. at 4.
She signed the city’s release and wrote under her signature that “I’m homeless and I don’t have another choice.” Id. They city considered her release ineffective and refused to proceed unless she executed a release without reservations like these. She did:
Walker needed the money: She attests that she “did not want to sign” but that she “thought about dying” and then executed a clean copy of the release “so that [she] would not be homeless any longer.” J.A. 217; accord id. (“If I had had a choice, I would not have signed it.”). The City of Charlotte then paid Walker $45,000. Cardinal repaired portions of Walker’s home, though water and sewer issues persist.
Slip op. at 5.
She sued, asserting that she was under “undue influence” when she signed the release (which was therefore ineffective). Her complaint also asserted inverse, takings, and negligence claims. Id. Motion to dismiss followed (she signed a release!). Although the district court denied the motion to dismiss, it noted the case was ripe for summary judgment after discovery. When the city eventually sought summary judgment, the court granted it.
The Fourth Circuit reversed, concluding that the jury should determine whether Walker voluntarily signed the release or was under duress. That question is generally a fact-intensive inquiry, and Walker offered evidence that her situation made her more susceptible:
Her house had been flooded with raw sewage, and she had “no spouse support or money saved up” to fix it. J.A. 216. In her affidavit, Walker testified that at the time she signed the release, she was losing her temporary housing and was “in fear for [her] life” because she “had nowhere else to go” and “it would be very cold in the winter.” Id. Though initially she signed the release with a “protest statement” included, she removed the statement at the City of Charlotte’s request after she “thought about dying.” J.A. 217.
Slip op. at 12.
The court noted the vibe that contracts are contracts and are generally susceptible to summary judgment, and that “financial difficulty cannot ‘by itself justify setting aside a settlement on the grounds of duress.'” Slip op. at 14 (citation omitted). But when the situation is such that the choice someone faces is a “Hobson’s choice,” the jury, and not a judge summarily, should decide the question:
All of that considered, this is a matter that is controlled by the laws of North Carolina. And under North Carolina law, when a negligent actor creates physical peril for a victim and then conditions rescue funds on the release of the victim’s claims, there is at least a question of fact on whether the release was obtained through undue influence. See Link, 179 S.E.2d at 705–07; Little, 121 S.E. at 187; Causey, 81 S.E. at 918. That is the factual question that the record before us presents that should be resolved by a jury, not by summary judgment.
Slip op. at 16 (footnote omitted).
One judge concurred and dissented, and would have affirmed the voluntary nature of the release. Slip op. at 19 (Niemeyer, J., concurring in part and dissenting in part) (“The fact that the City was able, because of its superior financial condition, to adhere to its final offer is not a ground to void the agreement that Walker voluntarily signed, albeit in protest, with the approval of her attorney.”).
Walker v. City of Charlotte, No. 25-1334 (4th Cir. Apr. 8, 2026) (unpub.)