Wolf v. Galex, 2013 N.J. Super. Unpub. LEXIS 1053 (App. Div. May 6, 2013). [Dislosure: I am co-counsel for Mr. Wolf in this matter, and I argued this appeal before the Appellate Division]. Plaintiff and defendant were law partners. They broke up their partnership and filed Chancery lawusits against each other. After those suits were filed, the parties conducted three mediation sessions before retired Appellate Division Judge Jack Lintner. At the end of the third mediation session, they reached a settlement. Judge Lintner quickly hand-wrote out the settlement terms and both parties signed that document. A day or two later, Judge Lintner sent the parties a typed version of the handwritten document that they had signed. Galex received that typed document but did not object or assert that there had been no settlement. On the contrary, his attorney repeatedly recognized “the agreement reached before Judge Lintner” in correspondence thereafter. The settlement terms included, among other things, a provision that “[a]ny disputes arising under this agreement shall be subject to binding arbitration before Judge Lintner.”
Later, Galex began to contend that there had been no settlement. He served discovery and filed a motion in the Chancery Division. Then, because the settlement agreement was “subject to” agreement on the personal property that Galex could take with him, and to preparation of more formal settlement papers and releases, Galexagain shifted his position and asserted that there were conditions precedent to settlement that had not been fulfilled. All the while, Wolf insisted that the parties had settled, and that any disputes were to be arbitrated by Judge Lintner, not handled in court.
In response to the motion that Galex had filed in the Chancery Division, Wolf filed a cross-motion to enforce the settlement. The Chancery Division denied that motion. Wolf then moved to compel arbitration, or for reconsideration of the denial of his prior motion to enforce the settlement. The Chancery Division rebuffed those requests as well. Wolf filed an appeal as of right from the denial of arbitration, and also sought review of the denial of his motion to enforce the settlement. In a per curiam opinion, the Appellate Division reversed the rulings below, agreed that the parties had settled their case, and remanded the matter so that the Chancery Division could dismiss the cases and send the parties to arbitration as to any remaining disputes.
The panel applied the de novo standard of review because “the trial court’s decision interprets a contract and turns on legal issues.” Especially given the strong state policies in favor of settlement and arbitration, and in the context of the record, the panel found that there were no conditions precedent, and that the parties had reached a final settlement. Citing numerous prior cases, the judges held that the fact that the parties contemplated a further agreement, to “dot i’s and cross t’s,” did not undercut the fact that they had settled on the material terms. “Moreover, the parties signed the handwritten agreement, not a step one would expect these experienced attorneys to take if they believed they had no settlement.”
The case contains an interesting appellate practice issue that the panel left open. Orders granting or denying arbitration are now immediately appealable as of right. Appeals from final judgments normally allow parties to bring up, at the same time, any interlocutory issue as well. Wolf thus argued that he was entitled to appeal as of right the denial of his motion to enforce the settlement, even though that motion would otherwise have been interlocutory. As a backstop, though, he filed a protective notice of motion for leave to appeal on that issue. The panel did not expressly reach the issue of whether Wolf had the right to appeal the order denying enforcement of the settlement as incident to his appeal as of right of the order denying arbitration. Instead, the judges granted Wolf’s motion for leave to appeal, “[i]n the interests of justice, and to avoid any possible issue as to [the Court’s] jurisdiction.” Thus, whether an appeal as of right of an order granting or denying arbitration permits, or even requires, the appellant to bring up interlocutory rulings at the same time, remains for another day.