A trio of current cases once again highlights the importance of properly documenting mediation settlement agreements:
California Mediation Confidentiality Statute Prevents Enforcement of Settlement in Federal Court
A federal court in California “reluctantly” held that even though the parties settled in mediation by accepting in writing a mediator’s proposal, and the mediator stated in writing that the case was settled, since there was no express statement that the settlement agreement was binding or admissible, as required by California law, the agreement could not be admitted or enforced by the court.
In re TFT-LCD (Flat Panel) Antitrust Litigation, No. M 07-1827 SI (U.S.D.C. N.D. Cal., December 3, 2013)
Mediator Improperly Testified About Oral Settlement in Kansas Mediation, Absent Statutory Exception
A Kansas appellate court concluded that the trial court erred in permitting a mediator to testify that an oral agreement had been reached in mediation and what the terms of the purported agreement were. The appellate court noted that several states, including Louisiana, Ohio, Wisconsin, Kentucky, Connecticut, Iowa and Wyoming, have express exceptions allowing mediators to testify about disputed agreements, but that Kansas does not have such an exception. Thus, the general rule of mediation confidentiality applies as long as any party objects to admitting mediation communications, which occurred in this case. Without the mediator’s testimony there was not sufficient evidence of the terms to enforce any agreement. The appellate court urged parties to put settlement agreements in writing, citing a law review with a form checklist and term sheet.
Baraban v. Hammonds, No. 105,993 (Kan. Ct. App., October 18, 2013)
Oral Settlement Agreement Not Enforceable Due to Disagreement over Material Term
While the parties agreed that an oral settlement agreement had been reached in mediation, a Delaware court refused to enforce it because of disagreement over the scope of the release, which the court concluded was a material term. Mediation confidentiality was waived by the parties relying on mediation communications. However, statements of the mediator during the mediation were generally excluded as hearsay because the court found no applicable hearsay exception.
United Health Alliance v. United Medical, CA No. 7710-VCP (Del. Ch., November 27, 2013)