Settlement Agreements & Enforcement: - PowerPoint Presentation

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Settlement Agreements & Enforcement: Lawyers shall not Lie, Cheat or StealNathan D. AlderChristensen & Jensen, p.c.30 minutes ethics credit

Why?

Why do settlements fall apart?

They just do

SO, Knowing that “things happen,”

what should you do?

During negotiations (between parties, counsel)

Write it down, get agreement/ACCEPTANCE, signatures

a. Keep notes

B. Keep track of progress, dates, times, exact offer(s)

C. MEMORIALIZE, REPEAT, EMAIL, CONFIRM, build trust

D. ask do I have enough for a motion to enforce?

E. WRITE OUT TERMS & CONDITIONS SO AS TO ENFORCE

F. SEND CLEAR OFFER(s), GET CLEAR ACCEPTANCE, CONFIRM

During mediation & particularly at THE end of mediation:

a. BUDGET YOUR “AGREEMENT” TIME V. “NEGOTIATION” TIME

B. COME PREPARED (TEMPLATES, FORMS, WORK PRODUCT, LAPTOP)

C. build an enforceable contract (MEETING OF MINDS, SPECIFICITY)

D. BUILD TRUST, BUILD BRIDGE, SHIFT GEARS FROM DISPUTE TO RESOLUTION

E. work side-by-side w/ counsel, incorporate (RED-LINE) changes

F. DON’T BLOW IT UP OVER TECHNICAL STUFF

G. anticipate & envision “

problemATIC

” terms & conditions; DON’T LOSE OR FORGET TERMS

H. Finalize, EXECUTE/SIGN - WET INK (BLUE), (DETRIMENTALLY) rely on completed

AgreemenT

, ATTACH NECESSARY EXHIBITS (PAYMENT PLAN, INTEREST AMORTIZATION, PICTURE OF LAND/BOUNDARY, ETC.), REPORT SETTLEMENT, PERFORM SETTLEMENT, IMPLEMENT SETTLEMENT.

What does that look like at mediation?

Is your document

or

mediation agreement

intended

as

a

final

executory accord?

Is it enforceable?

ACC Capital Corporation v. Ace West Foam, 2018 UT App 36:

Since an executory accord constitutes a valid enforceable

contract, basic contract principles affect the determination of

when a settlement agreement should be so enforced.”

Goodmansen

v. Liberty Vending Sys., Inc., 866 P.2d 581, 584 (Utah

Ct. App. 1993) (citation and internal quotation marks omitted).

“[A] binding contract exists where it can be shown that the

parties had a meeting of the minds as to the integral features of

[the] agreement and that the terms are sufficiently definite as to

be capable of being enforced.” LD III, LLC v. BBRD, LC, 2009 UT

App 301, ¶ 14, 221 P.3d 867 (second alteration in original)

(citation and internal quotation marks omitted).

The last paragraph of the MOU states: The parties and their counsel will work in good faith and make reasonable efforts to bring about this resolution and settlement, including the preparation and execution of a more formal

settlement agreement and release of all claims, as well as stipulation and order for dismissal with prejudice.

¶21 This court’s recent decision in Patterson v. Knight, 2017 UT App 22, 391 P.3d 1075, forecloses ACC’s argument that this provision renders the settlement agreement unenforceable. In Patterson, this court held that a settlement agreement was final and enforceable even though it anticipated “the negotiation and execution of further agreements, which never happened.” Id

This court held that the mere fact that the parties “contemplated the later execution of formal settlement agreement documents” did not render the agreement reached in mediation unenforceable.2 Id.

¶ 13. As this court noted, “[

i

]t is common for parties to later memorialize in a more formal document agreements created in mediation. This arrangement does not preclude the enforcement or finality of the agreement created in mediation so long as the terms are ‘sufficiently definite as to be capable of being enforced.’” Id. ¶ 12 (quoting LD III, LLC v. BBRD, LC, 2009 UT App 301, ¶ 14, 221 P.3d 867).

Avoid conditions precedent

In Patterson v. Knight, 2017 UT App 22, 391 P.3d 1075, the language of the settlement agreement stated that it was “[s]

ubject

to” the drafting of a “mutually acceptable settlement agreement.” Id. ¶ 2. The court determined that the “subject to” language created a condition precedent that was satisfied when

Patterson sent the formal agreement to the Knights. Id. ¶ 11. Specifically, the agreement stated that it was “[s]

ubject

to drafting mutually acceptable settlement agreement w/ above provisions and mutual non-disparagement, and [additional agreements].” Id. ¶ 2. Here, the language in the MOU is even less

helpful to ACC. Unlike the written agreement in Patterson, the MOU did not contain language signaling that the preparation of such documents was a condition precedent to the finality of the agreement. See id. ¶ 10. Instead of using words such as “subject to,” “provided,” or “on condition that,” the MOU stated only that the parties and their counsel would work together in good

faith to prepare a more formal settlement agreement.

CONTEMPLATE FINALITY IN YOUR NEGOTIATIONS

FINALITY IN AGREEMENT

BE DEFINITE

AVOID CONTINGENCIES

AVOID COMPLICATED CONDITIONS

AVOID UNDEFINED OR UNDEFINABLE TERMS

AVOID INTERPRETATIONS, MISINTERPRETATIONS

SET (LOWER) EXPECTATIONS OF CLIENTS

ENVISION HOW BREACH IS EASIST OR LIKELY TO OCCUR

Rules of professional conduct -- Preamble: A Lawyer's Responsibilities.

[1] A lawyer is a representative of clients, an officer of the legal system and a public citizen having special responsibility for the quality of justice. Every lawyer is responsible to observe the law and the Rules of Professional Conduct, shall take the Attorney's Oath upon admission to the practice of law, and shall be subject to the Rules of Lawyer Discipline and Disability.

Attorney's Oath: "I do solemnly swear that I will support, obey and defend the Constitution of the United States and the Constitution of Utah; that I will discharge the duties of attorney and counselor at law as an officer of the courts of this State with honesty, fidelity, professionalism, and civility; and that I will faithfully observe the Rules of Professional Conduct and the Standards of Professionalism and Civility promulgated by the Supreme Court of the State of Utah."

[2] As a representative of clients, a lawyer performs various functions. As advisor, a lawyer provides a client with an informed understanding of the client's legal rights and obligations and explains their practical implications. As advocate, a lawyer zealously asserts the client's position under the rules of the adversary system. As negotiator, a lawyer seeks a result advantageous to the client but consistent with requirements of honest dealings with others.

… Honest dealings with others.

Rule 1.4. Communication.

(a) A lawyer shall:

(a)(1) promptly inform the client of any decision or circumstance with respect to which the client's

informed consent, as defined in Rule 1.0(e), is required by these Rules;

(a)(2) reasonably consult with the client about the means by which the client’s objectives are to be accomplished;

(a)(3) keep the client reasonably informed about the status of the matter;

(a)(4) promptly comply with reasonable requests for information; and

(b) A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.

Rule 4.1. Truthfulness in Statements to Others.

In the course of representing a client a lawyer shall not knowingly:

(a) Make a false statement of material fact or law to a third person; or

(b) Fail to disclose a material fact, when disclosure is necessary to avoid assisting a criminal or fraudulent act by a client, unless disclosure is prohibited by Rule 1.6.

Thank you !!