In Hernandez v State Automobile, issued last month by the Michigan Court of Appeals, Plaintiff sued her automobile insurance company to get past and future personal-injury benefits. Following a couple of mediation sessions, the parties reached an agreement via emails with the mediator. It included the proviso that the agreement was contingent on the approval of the Michigan Catastrophic Claims Association (MCCA). The document formalizing their agreement was never signed.

The MCCA refused to approve the agreement, because surveillance indicated that the plaintiff was not as injured as she claimed. Defendant retracted the agreement, and plaintiff sued to enforce it. The trial court determined that defendant had waived the condition precedent by continuing its surveillance of the plaintiff after they had reached the agreement; defendant appealed.

The Court of Appeals’ first question was whether the parties had reached an enforceable agreement; the court agreed with the trial court that they had. Refuting the contention that a party must sign an agreement in order for it to be valid, the court noted that the attorneys’ names at the end of their emails satisfied the subscription requirement of MCR 2.507(G), citing Kloian v Domino’s Pizza LLC, 273 Mich App 449, 452; 733 NW2d 766 (2006), a case which did not involve a mediated agreement.

As inked autographs become rarer, the Court has wrestled with the requirement in MCR 2.507(G) that to be enforceable, “evidence of the agreement is in writing, subscribed by the party against whom the agreement is offered or by that party’s attorney.” Do emails count as “in writing”? If so, how does the email meet the requirement that it be “subscribed”? The Kloian case attempted to answer this regarding negotiated settlements, if unartfully, and last summer the court applied it to a mediated agreement, ruling in Amante v Amante, (No. 331542, Court of Appeals unpublished case, June 20, 2017) that an email containing the attorney’s name was not a term of the settlement because the parties were not negotiating the settlement via email, having already reached a mediated agreement. So now Hernandez, while also an unpublished case, signals that email negotiations can result in an enforceable mediated agreement where the key provisions include the attorneys’ names.

The next question was whether the defendant had waived the condition precedent by continuing its surveillance of the plaintiff. The Court of Appeals, reversing the trial court, determined that defendant had done nothing to interfere with the condition precedent, so when the MCCA refused its approval, the agreement became invalid.

In the course of its analysis, the Court reviewed email and phone conversations between the mediator and the attorneys. Apparently no one objected to this. Perhaps the parties agreed in writing to waive confidentiality, a recognized exception under MCR 2.412(D)(1) – but it would’ve been helpful if the court had mentioned that they had done so.

The Michigan Court of Appeals has issued just its second published opinion on the enforceability of mediation agreements, and it’s another divorce case, Rettig v Rettig, Case No. 338614 (January 23, 2018). (The previous case was Vittiglio v Vittiglio, 297 Mich App 391; 824 NW2d 591 (2012).)  The narrow issue in Rettig concerns whether a trial court must make findings on the record regarding the best interests of the child(ren) and the established custodial environment, after the parties have already reached an agreement through mediation. (It does not.) So this case applies only to the minority of cases where a divorce involving minor children is mediated.

One question is why this case was one of the ten-percent of Court of Appeals cases selected for publication. Many thanks to my colleague Lee Hornberger for pointing out that it could be because Rettig overrules the holding in Vial v Flowers, Case No. 332549 (September 22, 2016), where the Court of Appeals ruled that the trial court had not “adequately examined” whether the mediated custody arrangement was in the best interests of the child. In Rettig, in contrast, the Court of Appeals rejected as “nonsensical” the father’s argument that the trial court was required to make a finding regarding “best interest” factors “in the context of an agreement between the parties.” The Rettig court seems much more willing to let the mediated agreement regarding custody stand without investigation by the trial court.

Interestingly, Judge Jane Markey was on the three-judge panels that decided both the Rettig case as well as Vial v Flowers.

Since it’s going to be published, becoming state-wide precedent, it’s worth considering other aspects of Rettig.

The court first wrestled with whether the “memorandum” that issued from the parties’ mediation was an enforceable agreement. It’s not clear why this was even an issue, since the memorandum apparently included various written terms and was signed by both parties. Why didn’t the Court simply refer to it as an “agreement”? The court said the husband “likened” their mediation agreement “to a mediation settlement, where MCR 3.216(H)(7) and MCR 2.507(G) would require certain procedures to be followed.” The only requirements of MCR 3.216(H)(7) are that “the terms of the settlement must be reduced to writing, signed by the parties.” The Court’s description of the Rettig memorandum meets this definition, so it’s unclear why the Court had to go to great lengths – noting that the agreement was “scrutinized” in a hearing – to declare it a valid agreement.

Rettig reiterates a point the Court has made in the past, that a party may not be relieved from a valid mediated agreement simply because that party has changed their mind. Consistent with other challenges to mediated agreements, the Court noted that the husband “had in fact agreed to the memorandum” but now appeared to have “simply regretted making it,” a condition to which the Court is unsympathetic.

The opinion says that the parties participated in “facilitated mediation.” Since the Court Rule defines “mediation” as a process in which a neutral third party “facilitates” communication, MCR 3.216(A)(2), it’s redundant to describe the process as “facilitated” mediation. Michigan continues to struggle with terminology regarding mediation, and the Court of Appeals is not helping.

One hopes that, before it’s officially published, the editors correct the typo in the second-to-last paragraph, “… whether the trial court must more stringently find by clear and convincing evidence that changing any established custodial environment is in the child’s best interest.”