Tuesday, August 31, 2010

Court of Appeal Requires Personal Consent for Enforceable Settlement Agreement

Critzer v. Enos (8/30/10) --- Cal.App.4th ---, emphasizes the need for the consent of all parties -- either in writing or orally before the court -- in order to obtain an enforceable settlement agreement.

In a multi-party action, the parties recited the terms of a settlement agreement in open court, and three of the five parties gave their consent on the record. The parties could not agree on the language of a formal settlement agreement, and one brought a motion to enforce settlement under California Code of Civil Procedure section 664.6, which provides:
If parties to pending litigation stipulate, in a writing signed by the parties outside the presence of the court or orally before the court, for settlement of the case, or part thereof, the court, upon motion, may enter judgment pursuant to the terms of the settlement. If requested by the parties, the court may retain jurisdiction over the parties to enforce the settlement until performance in full of the terms of the settlement.
The trial court granted the motion. The Court of Appeal, noting that the law requires the personal assent of the parties themselves, and not just their counsel, reversed:
We conclude further that because there was neither an oral settlement all parties personally agreed upon, nor a written settlement agreement signed by all of the parties, the court lacked authority under the summary procedure of section 664.6 to enforce any settlement.
Slip op. at 2.

The full text of the opinion is here.

Friday, August 20, 2010

Court of Appeal Rules Mediator's Testimony Inadmissible in Settlement Agreement Dispute

Radford v. Shehorn (August 19, 2010) --- Cal.App.4th ----, is one of those cases that's not just well reasoned, it's well written and fun to read. It asks whether a mediator can submit a declaration in support of a motion to enforce a settlement agreement. It begins:

Mediators facilitate settlement of legal disputes. They use a variety of techniques to achieve that goal which include listening, enlightening, suggesting, empathizing and, sometimes, cajoling. But once the mediation is concluded, the mediator may not offer clarification concerning the mediation or a disputed settlement unless the parties agree otherwise. Like an actor whose concluding scene occurs in Act 2, the mediator may not reenter the stage to play a part in Act 3.

The parties here signed a settlement agreement during a mediation. One party brought a motion to enforce the agreement pursuant to Code of Civil Procedure section 664.6. The first page of the agreement contains a waiver of mediation confidentiality. A question arose whether the first page was part of the agreement. The trial court found it was and granted the motion to enforce the settlement.

We conclude the trial court erred in admitting the mediator's declaration into evidence, but that the error was harmless. We affirm.

Slip op. at 1.

The Court reasoned that mediation confidentiality prohibits a mediator from testifying - in person or in a declaration - to anything having to do with a settlement agreement drafted at a mediation, including the number of pages the agreement contains. The trial court erred in admitting the mediator's declaration, but the Court held that the error was harmless because the motion was supported by counsel's declaration that the parties executed the settlement agreement. Although mediation confidentiality prohibits attorneys from testifying as to things said at mediation, it does not prevent them from testifying as to conduct, such as the parties signing the settlement agreement. That said, the Court affirmed the order enforcing the agreement.

The opinion is available here.