A person signed a settlement agreement to pay off a debt with a short-term lender in his name and the name of his spouse. After failing to comply with the provisions of the settlement agreement, the lender sought to enforce the agreement.
The Court held that the settlement agreement is not applicable on the spuse who did not sign the agreement and never empowered her spouse to sign on her behalf. In order to bind a person by an agreement, his signature as a party to the agreement is required or, if another signs on his behalf, an express power of attorney is required that authorizes another to sign on behalf. The power of attorney is required to be explicit and specific. The fact that the couple is married does not make the spouse liable for the obligations of her spouse. Here, the spouse was not part of her spouse's business, did not herself sign the settlement agreement which was signed on her behalf by her spouse, and never gave an explicit power of attorney empowering her spouse to sign on her behalf or undertake any obligations on her behalf. Therefore, it is not possible to enforce the settlement agreement or apply the obligations in the agreement to the spouse.