Enforcing Mediated Settlement Agreements Post-Simmons v. Ghaderi
Update: there's a good discussion of the holding and rationale at the Complex Litigator -- Simmons v. Ghaderi: mediation privilege trumps allegation of oral settlement agreement here.
I'm re-posting this "how to" now that Simmons v. Ghaderi has been decided. You no longer have even a fighting chance of enforcing a mediated settlement agreement that fails to comply with the Code. So here's the procedure, as recommended by my and Deborah Rothman's article in the Daily Journal in November 2006 -- Take Steps to Ensure that Mediated Settlement Agreements Can Be Enforced.
Assuming your client insists on orally memorializing the settlement reached in mediation, you must comply strictly with Evidence Code Sections 1118 and 1124. An oral agreement reached during a mediation can be proven and enforced only if (1) its terms are recited to a court reporter or recorded by a sound device in the presence of all parties and the mediator, (2) the parties expressly agree to those terms on the record, (3) the recording is reduced to writing and signed within 72 hours of its recordation and (4) all parties to the agreement expressly agree in a writing, in the sound recording or in the reported record that the signed written transcript may be disclosed.
Th[e] procedure for enforcing an oral settlement is so technical and cumbersome . . . (counsel and mediators rarely have court reporters standing by or tape recorders in their breast pockets), that we recommend against it.
We instead suggest that the parties document all settlements in writing, even if the writing contains only skeletal deal terms and even if someone has to begin drafting it at 2 a.m. The agreement should provide that the parties intend it to be enforceable or binding and that all parties expressly agree in writing to its disclosure. . . . If an action is pending between the parties, the memorandum of understanding should be made enforceable under Code of Civil Procedure Section 664.6.
See also the Supreme Court's decision in Fair v. Bhaktiari, interpreting the phrase "words to that effect" in section 1123(b) as requiring a written mediated settlement agreement to "directly express the parties’ agreement to be bound by the document they sign."
Almost right will not do. You must strictly comply with these provisions or your mediated settlement agreement will not be enforceable.