Reference no: EM132313542

O'Leary Corp. is sued in Texas court by a supplier for breach of contract. It hires the Dewey, Cheatem & Howe law firm to represent it in the contract dispute and gives the firm permission to settle the dispute for up to $100,000. The firm does negotiate a settlement, but for $110,000. Which is most accurate about the validity of that settlement contract?

• The settlement contract is valid because Dewey, Cheatem & Howe had express authority to negotiate a settlement and used its discretion in doing so
• The settlement contract is invalid because Dewey, Cheatem & Howe exceeded the scope of its express authority
• Although Dewey, Cheatem & Howe exceeded the scope of its express authority, the settlement contract would be valid if O'Leary Corp. ratifies it
• The settlement contract is voidable, but only at the option of O'Leary's supplier.