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Settlement Enforced Thanks to Mediator Testimony

by F. Peter Phillips
August 2011

Business Conflict Blog by Peter Phillips

F. Peter  Phillips

In New Jersey, the Superior Court Appellate Division recently approved for publication a decision in which a party to a mediation successfully sought to enforce a settlement agreement reached orally but not commited to writing during the mediation. The objecting party had claimed that (a) the New Jersey Rule pursuant to which the mediation took place required a writing in order for the settlement to be enforceable, and (b) the purported agreement was the product of coercion by the mediator.
Of particular interest, the party seeking enforcement “supported the motion with a certification of their attorney and the mediator,” who also was deposed and testified at the hearing.
Of even more particular interest, the parties in this General Equity action selected a retired (and unnamed) Superior Court Judge as mediator. The trial judge on the motion found his former colleague’s testimony “highly credible.” Imagine that!

Let’s focus only on how it came to be that the mediator submitted an affidavit is support of a party’s motion, and then was deposed and subsequently testified on behalf of that party. The appellate court noted that, by both statute and rule, a mediator “may not disclose any mediation communication to anyone other than a participant in the mediation session,” and referred to that bar as “an evidentiary privilege.” The privilege may be waived by the parties, however, and the court found that it had been in this instance.
How?
The moving party accompanied its motion with “a certification from the mediator,” thus unilaterally violating the confidentiality requirement. Apparently the opposition went ahead and deposed the mediator. The trial judge made (unspecified) rulings during both the deposition and the trial that confidentiality had been waived. That’s all we know.
Need I list the concerns here? What was the movant doing attaching a certification of the mediator to their opening papers, in open breach of stsutory confidentiality obligations? What on earth was the former judge-cum-mediator doing executing a certification for that purpose? What was the trial judge doing putting himself in a position to rule on his former colleague’s credibility? Or the admissibility of his testimony as set forth in his certification? Was the opponent to the motion required not to depose the prospective witness and then argue no waiver?
In New Jersey, as everywhere else, bad facts make bad law. And these are facts that could have been avoided by the mediator. A colleague, discussing this case, said he tells all parties during his mediation opening that if he is subpoenaed to testify “I’ll come with my toothbrush.” In addition, it is a good reminder of a couple of Mediation 101 lessons: Never Let Them Out of the Room Without Initialling an MOU and Never Never Never Violate Mediation Confidentiality.

Biography


F. Peter Phillips is a commercial arbitrator and mediator with substantial experience providing consultation on the management of business disputes to companies around the globe.

A cum laude graduate of Dartmouth College and a magna cum laude graduate of New York Law School, Mr. Phillips served for nearly ten years as Senior Vice President of the International Institute for Conflict Prevention and Resolution (CPR Institute). During that time, he earned a reputation as an author, teacher, industry liaison, and systems designer for the avoidance, management and resolution of complex and sophisticated business conflicts.

In 2008, Mr. Phillips formed Business Conflict Management LLC (BCM) in order to offer his direct services as a neutral and a consultant. Through BCM, Mr. Phillips also continues his career as a highly sought-after public speaker, facilitator and instructor.



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Website: www.BusinessConflictManagement.com

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