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How to Produce Mediation Paperwork

Although oral mediation agreements are enforceable, oral agreements in mediation can’t be enforced in a court of law against the will of one of the parties, because the rules governing confidentiality prevent one party from introducing the terms of the deal into evidence.

As a mediator, you should assume that the terms of an oral agreement reached in mediation can’t be enforced in the absence of a writing (any written proof, not necessarily a formal contract) unless you’re absolutely sure they can.

In California, most mediators provide the parties with a settlement agreement or term sheet template that complies with California law. That template usually looks something like this:

Date: _______________


Settlement Agreement in _______________ versus _______________
The parties to the above-referenced case understand and agree that this Settlement Agreement is admissible in evidence to prove its terms, that it is enforceable against and binding between the parties, and that it may be disclosed for purposes of its enforcement, all in accordance with California Evidence Code section 1123. The parties further understand and agree that this Settlement Agreement is enforceable by motion of any party pursuant to California Code of Civil Procedure section 664.6.

After you provide an appropriate template, or simply paper and pen, the parties themselves should write up and sign the entire deal, which usually includes the following:

  • The settlement agreement: At its most basic, the settlement agreement states in writing what both parties agree to give and give up in order to settle their dispute; when the exchange will take place; and, if the exchange occurs over time, the consequences of nonperformance.

    If one party has made representations to induce the other party to enter into the agreement, the parties should understand that the agreement gives them the opportunity to reiterate the substance of the representations, the parties’ reliance on the truth and accuracy of those representations, and the parties’ mutual understanding that the agreement is enforceable only if those representations are in fact true and accurate.

  • Mutual general releases: Most settlement agreements contain mutual general releases that relieve both parties from any further claims by the other based on the subject matter of the complaint or dispute. Most states have laws that specify the wording that an effective mutual general release should include. The parties should seek legal advice about the enforceability of their general releases.

  • Terms: Terms may include

    • Payment of attorneys’ fees and costs in the event of breach

    • Submission of any breach to further mediation, followed by arbitration

    • Choice of law provisions, particularly when the parties live in different states or when questions are raised about whether the matter is controlled by state or federal law

    • Warranties of authority to enter into the agreement if corporate, partnership, or joint ventures are parties to the dispute

    • Indemnity clauses if necessary

    • Time is of the essence clauses

    • Agreement that the parties will take all action necessary to assure that the agreement is performed

If the parties agree on payment terms over time, they often want to draft the documents necessary to obtain a judgment in the event of default. In such instances, the parties usually prepare two additional documents:

  • The stipulation for the entry of judgment: When the parties agree to exchange something of value at a later date, the party who risks nonperformance often requires the other to stipulate to the entry of judgment in the event of default.

    Sometimes these stipulations include hammer clauses specifying that the individual who promises to pay a certain sum of money over a specified period of time consents to the entry of judgment in a greater sum than the agreed-upon settlement if he fails to make payments according to the agreement.

    This provision gives the paying party a strong inducement to honor his agreement and gives the other party assurance that he’ll either be paid in a timely manner or be entitled to more money.

  • The proposed stipulated judgment: The proposed stipulated judgment is worded as a judgment for the court to sign and should contain a signature line for the court.

You can carry sample agreements as well as sample stipulations for the entry of judgment and stipulated judgments on a thumb drive to assist the parties in drawing up their agreement. Always advise the parties that you don’t represent any of the parties, nor do you represent the agreement itself.

Tell them that you don’t provide legal advice and won’t vouch for the legality or enforceability of any settlement agreement or legal document you provide to them for their consideration in drawing up their deal. Admonish them to seek out the advice of lawyers if they don’t have lawyers present at the mediation.

If they have lawyers present at the mediation, tell the parties that their lawyers are charged with the responsibility of ensuring that the agreements drafted during the mediation are enforceable and contain all the terms necessary to resolve their dispute.

For sample mediation agreements and forms along with some additional bonus items, visit www.MediatorSuccess.com.

You should also have these documents on a laptop or smart phone in case you forget your thumb drive when you’re mediating. You can also access the documents remotely if you store them somewhere on the web — on Google Docs, for example.

You’re the mediator, not the legal representative of the deal, and you may not be authorized to practice law. Therefore, whenever you suggest that the parties use your forms, tell them that you’re not acting as an attorney (if you are one) or can’t act as an attorney (if you aren’t one). Tell the parties that their lawyers, if each party has a lawyer, should review the documents.

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