Guest post by John Butler
The mediation is a success! The conflict is resolved and agreements have been made. So now what? How will these agreements be memorialized or enforced? There is more than one correct answer and the method depends on the concerns of the parties. Here are the most common scenarios:
Memorandum of Understanding
A memorandum (memo) of understanding is a shorthand summary of a firm agreement arrived at through mediation. The memo is drafted during the wrap-up phase of the mediation session and includes the general terms agreed upon. It is then signed or initialed by each party. This creates an enforceable agreement.
In my entire career as a mediator, I have only had one party try to get out of a settlement with a memorandum initialed by the parties. In this case, it was the plaintiff and he wanted more money. He refused to cash the check proffered by the defendants. The other party to the settlement then went to Court and had the Judge rule on the validity of the terms of the mediated settlement. The Judge approved the terms of the settlement and ordered the plaintiff to accept the check.
When crafting a memo of understanding, it is understood (and I always explain this carefully to my clients) that the memo is to be interpreted by the mediator in the rare event there is a dispute about what was written in the memo. However, since the parties directly negotiate the terms of the settlement, a dispute like this rarely occurs.
I recently had a divorce case involving a complicated move-out scenario with a lot of logistical details. I jotted down the particulars and had the parties initial it. Within a few days, one party was trying to change the deal, claiming the memo was not clear. What the person actually wanted, though, was to change the terms of the move-out. Wanting to change the terms isn’t that unusual; circumstances can change and adjustments may be desired or necessary. However, in a divorce case, trying to renegotiate could be seen as reneging and could set off a tripwire of explosive overreactions on one side or the other.
In this particular case, some of the alterations were attempts to renegotiate minor details for convenience (e.g. begin loading at 10 a.m. instead of 9 a.m.) and some were more substantial changes (e.g. delay the move-out one week). Since I held the final say as to what the memo stated as their agreement, the spouse seeking the changes called me. I knew I could communicate with the other spouse and renegotiate the details of the changes without much risk of escalation. As a result, the basic deal remained in place and the minor details were sorted out with minimal friction. I sent a confirming email to both parties and that was the end of it.
As mentioned above, when transactions are concluded over the phone or via email, the common practice is to send out a short confirming email outlining the details. I often write the same email to each party, asking them to reply to me acknowledging this is what they agreed to. I also state that unless I hear from them I will conclude that this confirms their agreement. This format forces them to affirmatively object rather than passively delay when they disagree with the confirming email. If there is a disagreement with the confirming email, the objection comes only to me, and not to the other spouse. This protects the process from escalation and reactivity. If I was inaccurate in my summary, I want to clear it up right away. In these cases, I will resend a new confirming email with a short introduction regarding the correction being requested. In situations where there is a breakdown after the agreement, then I want to deal with it without allowing it to escalate into a flame war via emails.
On some occasions, for example, when setting an appointment, I will simply ask the parties to “reply all” to confirm their agreement with the schedule and in these instances everyone sees the reply of everyone else.
Formal Settlement and Release Agreement
In divorce cases, one or both of the parties may wish the terms of the settlement be converted into a Court order or Divorce Judgment. If the mediation resolves the entire case, then a Marital Settlement Agreement will be drafted by one of the attorney for one of the parties, circulated and signed by all parties. Once that happens, it is submitted to the Judge for approval and attached to the final judgment in the divorce case.
If the mediation only resolves one matter and not the entire case, (say, for example, how the couple is going to handle the move-out and sale of their home, or how they are resolving custody and visitation of the children) then the agreement in converted into a “Stipulation and Order”. The “Stip and Order” (as it is called in the trade) is signed by both parties (and their attorneys if they are represented by lawyers). It is then sent into the Court for the Judge to approve. If the parties have not retained attorneys, then they need to get their signatures notarized before sending it into Court. In either case, the Judge will almost always promptly approve a Stip and Order.
In some mediations, we end with a handshake agreement. Typically, I will summarize the terms of their settlement, confirm with each party that the summary is correct and then have them stand and shake on it. This happens most often when there is no Court case pending and no lawyers involved. Usually the solution is a common-sense resolution and if any money is involved, it will be paid on the spot or promptly. Common examples are post-separation divorce cases or roommate cases (when unmarried couples who were living together are now separating).
In these instances the parties tend to want to avoid the cost of legal fees to draft up a formal agreement. More importantly, I think they want to maintain a sense of goodwill between themselves. Drafting a formal agreement might undermine the sense of trust they have established in hashing out the problem and settling it without going to Court.
Agreements reached in mediation result in an enforceable contract between the parties. Each mediated agreement will have some enforcement mechanism either expressed or implied in the terms of the agreement.
Mediated agreements in divorce cases are typically enforced by the Judge presiding over the divorce case. However, they also often require the parties to conduct a round of mediation before either party goes to the Judge complaining. This is to help them avoid the hard feelings which often occur from an escalation when one party is formally accused of a default.
In mediation, the parties arrive at their own settlement based on their needs and their concerns. They decide how to memorialize their agreement and what, if any, enforcement procedures will work best for them. Given this, there is no one right way to document a settlement achieved in mediation, but there are numerous effective options.
About John Butler: After 20 years as a mediation attorney, I’ve found a novel way to help my clients called “Virtual Mediation.” It’s a less costly and less painful process which allows parties to reach a settlement without having to meet face to face in an office or even talk with one another at the same time. They do not even need to appear in Court. We work together using phone and internet and it’s all confidential. This approach removes much of the friction and difficult emotion that can hamper effective discussions. Having spoken on conflict resolution at a number of seminars, trained other attorneys in mediation, and worked intimately with many hundreds of clients, I am convinced this is the leading edge of mediation. Contact us at 408-502-1348 or email at john@virtualdivorcemediation. We’re also on Facebook.