Mediation Settlement Agreements Explained
Mediation settlement agreements are the final resolutions of all issues between parties to a dispute that have been settled at mediation. A mediation settlement agreement gives those private negotiations the form of a contract. Mediation settlement agreements apply equally in business and family disputes, although they may go by other names, such as a "Minute Entry & Order" in the Court System or a "Separation Agreement" in a divorce.
While the parties to a dispute may reach a verbal agreement, or handshake agreement, to resolve their dispute, a mediation settlement agreement serves to (a) provide certainty and clarity as to the terms of the agreement, (b) allow for enforcement of the agreement, and (c) ensure validity of the agreement .
In short, a mediation settlement agreement provides a written record of the mediation session. It serves as an official document which is testament to the agreement that was made by the parties and recorded by the mediator and/or legal representatives. It also serves to memorialize the results of private negotiations between the parties that are not intended to be binding on the parties or enforceable by the court. It is not until the mediation settlement agreement is signed by all parties that it becomes binding. In this way, mediation settlement agreements are significant as a means of preserving the mediation process and the confidentiality and finality associated with it.
Essential Elements of a Mediation Settlement Agreement Template
The essential elements of a mediation settlement agreement template must include the party details, including an identification of any corporate entities; a description of the dispute that has been resolved; and the terms that have been agreed upon by the parties. No mediation settlement agreement template would be complete without a confidentiality agreement or a statement that the agreement is final and binding on the parties, as there are certain California provisions – including California Evidence Code 1119 – that will make oral communications made during mediation inadmissible, but do not make the final written settlement agreement inadmissible.
Advantages of Utilizing a Mediation Settlement Agreement Template
One of the key advantages of using a mediation settlement agreement template is the time-efficient nature of creating the legal document. Most templates cover all the specifics and details of a mediation settlement in a structured manner. By using a mediation settlement agreement template, the individual or corporate counsel can simply define information specific to the settlement, such as the names and addresses of the parties involved. In fact, many mediation settlement agreement templates are created with highlighted fields for the essential information that requires adjustment for each different settlement agreement.
Using a mediation settlement agreement template is also a cost-efficient method of creating legal documents. By providing the standard language for a mediation settlement, the template can be used for many different agreements, cutting out the cost of a law firm or attorney drafting a completely new legal document for each settlement. It is especially beneficial to corporations that frequently use mediation as a means of resolving disputes. Because the template can be used multiple times, it enables the individual to save money or time when preparing a mediation settlement agreement.
In addition to time and cost efficiency, a mediation settlement agreement template can be useful for the completeness of the legal document. Mediation settlement agreements are legal documents that require attention to detail and precision of the information that is provided. A mediation settlement agreement template may include specific language that should be incorporated into the mediation settlement agreement to address the statutory requirements in the specific jurisdiction where the mediation is taking place. A mediation settlement agreement template may also address procedural and legal requirements that must be included in the mediation settlement agreement, as well as specific language regarding the settling parties. Without the appropriate language included in the mediation settlement agreement, the party may find that the settlement is invalid in that particular state or jurisdiction. By using a mediation settlement agreement template, the individual can rest assured that the essential legal information is included in the mediation settlement agreement.
Customizing Your Mediation Settlement Agreement Template
Customizing your mediation settlement agreement template is essential for ensuring it meets the needs and interests of both parties. While a standard template can serve as a good starting point, it’s critical to tailor the language, clauses and provisions to your specific circumstances to avoid future disputes or misunderstandings.
The first step in customizing your template is to carefully review the standard clauses and provisions to determine what is applicable to your situation. Are there sections that don’t apply to your case? Are there any additional provisions or clauses that should be added to the agreement? What terms need clarification or expansion?
Once you have a clear understanding of your needs, you can then begin to customize the language of the mediation settlement agreement. It’s important to do so in a way that addresses concerns of both parties. It’s also essential to be mindful of legal requirements that may be relevant to your agreement.
For example, if you are mediating a business dispute, you may need to include clauses related to non-competes or confidentiality. If you are mediating a divorce, you may need to include clauses related to child custody or asset division. There are likely other terms in your agreement that need to be expanded, simplified or reworded to be clear.
When it comes to mediation clauses, be sure to include those pertinent to the nature of your case. These may include:
Revisions and drafts should be used as appropriate to create a clear and comprehensive mediation settlement agreement. If a dispute arises following your agreement, you want to be sure that it is appropriately worded to protect your interests and ensure you’re able to enforce the agreement.
A mediation settlement agreement template is a great starting point towards reaching an agreement. However, as with any legal document, it’s best to consult with your attorney to ensure that your mediation settlement agreement is legally binding, accurate and tailored to fit your needs.
Common Mistakes to Avoid When Drafting Mediation Settlement Agreements
A settlement agreement entered into at the conclusion of a mediation, whether a Family Law Mediation or Non-Family Mediation is as legally binding and enforceable as an order entered by a Judge. In many cases these agreements are drafted utilizing a template rather than having a mediator facilitate the drafting in real time on the record at a mediation. The parties will typically consider using a template that they have downloaded, pulled from their attorney and made adjustments as reflected in the terms reached at mediation. These settlement agreements, while effective, can at times become problematic and therefore it is important that the parties are aware of them prior to drafting these agreements.
Omissions of Terms – A common tendency parties utilize a template they have received without understanding that there are other issues which should be addressed, even if they were not considered at the mediation. It is also important to remember that settlement agreements are comprehensive and as such, it is wise to include parenting time considerations if parenting time was a term contemplated even if it was not part of the actual agreement . For example, while it may be acceptable for the holidays to be addressed, if schooling issues arose after mediation, they should be addressed in the settlement agreement to avoid future litigation.
Vague Terms – When drafting a settlement agreement creating uncertainty over the meaning of an agreed upon term may result in the opposing party failing to comply with the settlement. Vague terms may arise if the parties never reached an agreement on how a certain issue would be addressed at the mediation and as such, left it open; however, at a later date you may decide you should have, for example, addressed which party would claim the dependency exemptions. Leaving these types of terms vague can also result in expensive future litigation to address what both parties intended that term to mean.
Insufficient Assets – It is important that in addition to the terms being sufficiently addressed with enough detail, that the assets are also sufficiently addressed within the agreement. Again even if the parties were not in agreement on the disposition they should be adequately addressed as well.
Legal Considerations and Validity
When preparing a mediation settlement agreement, there are important legal considerations to bear in mind. It comes down to being able to enforce the court judgment that the agreement creates.
What happens during mediation is not binding on the parties until the mediation settlement agreement is signed. Essentially, you are entering into a binding contract at that point. Once the agreement has been signed, it can become a court order and is legally enforceable. Not having a settlement agreement could lead to an opposing party saying they didn’t sign anything. There are a number of reasons a party might use, such as arguing they were coerced or misled into signing the agreement, which is why having a settlement agreement made right after mediation is vital.
It is important to understand the jurisdictional requirements of creating a binding settlement agreement in your state. There are two typical jurisdictional requirements:
* The settlement agreement will have to be signed when you are outside of the marital domicile, and normally, signatures must also be notarized (although not always).
* The settlement agreement will have to contain certain provisions required by the examining court, such as rules regarding the disposition of marital assets and how liabilities will be handled.
It is also crucial that an attorney reviews the mediation settlement agreement to make sure there have been no mistakes in how it is drafted. Having an enforceable agreement that has been signed by parties and notarized can be binding once the judgment is entered. If there was a mistake in entering any information, the entire agreement can be deemed invalid.
Additional Resources for Mediation Settlement Agreement Templates
A variety of resources are available for those seeking guidance on effective mediation settlement agreements. Many reputable online legal services provide mediation settlement agreement templates and related documents that can be tailored to individual cases. Some mid- to large-sized law firms also offer free , downloadable mediation settlement agreement template forms on their websites.
Mediation professionals often maintain a roster of agreements on their website, or provide refers on where to find reliable mediation settlement agreement templates. Government websites, such as courts and other administration sites, may offer access to copies of mediation settlement agreements.