Willingboro Mall, Ltd. v. 240/242 Franklin Avenue, LLC, 421 N.J. Super. 445 (App. Div. 2011). Normally, any settlement, even an oral settlement agreement, can be enforced. The question in this case was whether a settlement agreement reached orally at a mediation could be enforced even though it was not reduced to a writing at that mediation. Judge Cuff’s opinion held that the settlement could be enforced since the parties had waived the confidentiality provisions of N.J.S.A. 2A:23C-4 (a part of the Uniform Mediation Act) and Rule 1:40-4.
Following a mediation session with a retired judge, defendants asserted that a settlement had been reached at the mediation. Defendants’ counsel wrote a letter to the court three days after the mediation that recounted the terms of the settlement. Defense counsel followed up with a letter two weeks after the mediation that stated that defendants had provided him with funds to implement the settlement. Plaintiff denied that any settlement had been achieved.
Defendants then filed a motion with the court to enforce the settlement, supported by certifications from defense counsel and the mediator. After discovery and a four-day hearing with testimony of five witnesses, including the mediator, the court found that the parties had reached a settlement at the mediation. The court found the testimony of the mediator, and that of plaintiff, credible, and found the testimony of defendant’s representative not to be credible.
Plaintiff appealed. Plaintiff’s key argument on that appeal was that Rule 1:40-4(i) requires any settlement agreement reached at a mediation to “be reduced to a writing and a copy [to] be furnished to each party.” The settlement was not put in writing at the mediation, but only three days later when defendants’ counsel wrote his letter containing the settlement terms.
Judge Cuff, however, noted that the Rule “does not provide that any agreement must be reduced to writing during the mediation session or that all parties must receive a copy of the agreement before they leave the mediation session as argued by plaintiff.” Memorializing a settlement in writing at the mediation “may be the preferable and advisable course.” However, some cases “may be complicated and the writing to memorialize the agreement may require some time to produce.” In the context of this case, the three days that elapsed between the mediation and defense counsel’s memorializing letter did not undo the settlement reached at the mediation. After all, as Judge Cuff rightly stated, “the very purpose of the [mediation] process is to resolve the dispute.”
The panel acknowledged decisions by other courts that had refused to enforce oral settlements reached at mediation because doing so would contravene the confidentiality of mediation. But unlike in those cases, these parties had waived that confidentiality. Defendants had submitted a certification from the mediator, who was then deposed and later testified at trial. Plaintiff never argued that no waiver of confidentiality had occurred.
Since the trial judge’s findings about the fact of the settlement and the credibility of witnesses were supported by credible evidence, the panel affirmed the decision below. An argument by plaintiff that the settlement was the result of coercion or duress, and an attempt by defendants to get attorneys’ fees for frivolous litigation, both failed.