Settlement Agreement for Dispute Resolution: Terms and Conditions, Schemes and Mind Maps of Mechanics

Download Settlement Agreement for Dispute Resolution: Terms and Conditions and more Schemes and Mind Maps Mechanics in PDF only on Docsity! Model Settlement Agreement Model Settlement Agreement Date Parties _______________________________________________________ (“Party A”) _______________________________________________________ (“Party B”) [ ______________________________________________________ (“Party C”) and add more as necessary] (jointly “the Parties”) The Parties having agreed to settle "the Dispute" which: • is being litigated/arbitrated [court/arbitration reference] ("the Action")1 • has been the subject of an RICS mediation procedure today ("the Mediation") upon the following terms and conditions: Terms It is agreed as follows: 1. [ will deliver……… to at ……… by not later than 4 o’clock on …]2 2. [ will pay £……… to by not later than 4 o’clock on … (by direct bank transfer to …. bank sort code … account number …) …]3 OR [ will pay £ to per week/calendar month/ in ( ) tranches by cheque/cash/bank transfer commencing on or before and thereafter until finishing on or before ] 3. [ In default of such payment (all outstanding sums shall fall due and payable forthwith/or) shall pay interest on the balance outstanding at the rate of % above base rate for the time being to payment]4 1 Omit this wording and paragraph 5 if there are no court proceedings 2 Omit as necessary but otherwise be as specific as possible in respect of any act positively required to be performed, for example, how, by when, etc. or alternatively to be refrained from. 3 Or any other tranche of payments or currency agreed 4 Optional. Many mediators dislike putting in any default provision. 4. [ ]5 5. The Action will be stayed and the parties will consent to an order in the terms of the attached Tomlin Order precedent [see attachment]. OR The Action will be dismissed with no order as to costs. 6. This Agreement is in full and final settlement of any causes of action whatsoever which the Parties [and any subsidiaries ……. of the Parties] have against each other. 7. This Agreement is the entire agreement between the Parties and supersedes all previous agreements between the parties [in respect of matters the subject of the Mediation].6 8. If any dispute arises out of this Agreement, the Parties will attempt to settle it by mediation7 before resorting to any other means of dispute resolution. To institute any such mediation a party must give notice to the mediator of the Mediation. Insofar as possible the terms of the Mediation Agreement will apply to any such further mediation. If no legally binding settlement of this dispute is reached within [28] days from the date of the notice to the Mediator, either party may [institute court proceedings / refer the dispute to arbitration under the rules of … 8]. 9. The Parties will keep confidential to themselves, their legal advisers [and by agreement ] and not use for any collateral or ulterior purpose the terms of this Agreement [except insofar as is necessary to implement and enforce any of its terms]. 10. This Agreement shall be governed by, construed and take effect in accordance with [English] law. The courts of [England and Wales] shall have exclusive jurisdiction to settle any claim, dispute or matter of difference which may arise out of, or in connection with this agreement.9 Signed _______________________________________________________________________________________ [for and on behalf of10 ____________________________________________________________________] 5 Any additional positive or negative performance obligations 6 Only necessary if there have been previous agreements 7 Alternatively, negotiation at Chief Executive level, followed by mediation if negotiations do not result in settlement within a specified time 8 Reference to the appropriate arbitration body 9 Usually not necessary where parties are located in same country and subject mater of agreement relates to one country. If the Parties elect for their agreement to be governed by the laws of another jurisdiction they should take legal advice on the implications for enforcement. 10 Not necessary where the party signing is an individual • confidentiality • any relevant choice of law or jurisdiction • that this is the entire agreement between the parties • a default mechanism to deal with future disputes • whether, if there is a breach of this agreement, the original cause of action should be reinstated (the opposite of the standard Tomlin order). The settlement-specific clauses need to be certain as to:- • payment: who pays, to whom is payment made, and how much • the form in which payment is to be made • whether payment is to be immediate or in stages • the mechanism for default of payment • the provision of interest • the costs of the litigation • the costs of the mediation • any public statements • the discontinuance or withdrawal of proceedings • any special clauses dealing with enforceability • who is the signatory, his or her status or authority. 7. There will be occasions when the parties can do no more than agree outline heads of agreement, but this should be avoided wherever possible. Saving an hour at the end of the mediation by agreeing only outline heads of agreement exposes the parties to the risk of further disputes in which the argument shifts from its original subject matter to contesting what has been agreed. It is essential that the intention of the parties is made plain, and there is at least sufficient detail to ensure that an impartial reader would have a clear idea of precisely what has been agreed. If there is no time to put in the complexity of the mechanics of the transaction, or, for example, the tax implications have not been advised upon or worked out, at least draw a distinction between the agreement itself and the mechanics for performing it. Explanatory notes for the user of the settlement agreement (i.e. unrepresented parties) The Settlement Agreement 1. Mediators are not encouraged to participate in assisting the parties to draft their settlement agreement. Your RICS Mediator may not have a legal background, even though he or she will be experienced in the type of dispute being mediated. RICS Mediators will therefore generally not participate in drafting the settlement where you or the other party has legal representation. If that is not the case the Mediator will encourage you either to settle the agreement yourselves, or at least the heads of agreement, and then have a lawyer provide such additional detail as is necessary. 2. It is essential that you secure a concluded agreement with the other party or parties that is workable, comprehensive, (both as to the dispute and any wider issues which have been introduced,) and enforceable. It is vital that the parties, usually through their lawyers, get the form of the agreement right, to ensure that the settlement is enforceable. The terms must be certain, specific, effective, practical and complete, in particular dealing with who is to do what, when, and with what precise consequences should that party fail to do what it has agreed. Normally such agreements are reduced to writing at the conclusion of the mediation since, although you may aftewards have some reservations about what was agreed, and you may wish to build in a ‘cooling-off’ period prior to the agreement taking effect, it is important that you are not influenced by someone who was not at the mediation and did not see what happened to enable the parties to agree. 3. Consider whether a provision will need to be inserted detailing with what to do if one fails to adhere to the agreement or if it proves to be unworkable. 4. The Mediator may suggest in advance that the lead representative on each side should take a draft containing the likely heads of agreement with him or her, and, if litigation is running, a general form of Tomlin order which deals with the completion of any court proceedings. If the compromise contains terms found in a recognised standard form or precedent used by lawyers in such cases, it needs to be brought to the mediation otherwise you may be forced to locate it, possibly out of business hours, and probably at a highly inconvenient time for doing so. 5. As settlement nears, your lawyer or representative may begin to draft the proposed agreement in the caucus room. The Mediator will encourage a discussion of the structure, form and contents with you as early as possible, since this can be done as the mediation progresses and will help focus your mind on the details, place your personal agenda in context and deal with the practicalities of its implementation. 6. Your settlement agreement needs to strike a balance between too little, and too much detail. You should understand it. Remember it is likely to be either quite late or very late, at the end of a long day. Please ensure that the signatory, if not you, has authority to sign. There may be certain standard clauses irrespective of the nature of the settlement. These should deal with:- • confidentiality • any relevant choice of law or jurisdiction • that this is the entire agreement between the parties • a default mechanism to deal with future disputes • whether, if there is a breach of this agreement, the original cause of action should be reinstated (the opposite of the standard Tomlin order). The settlement-specific clauses need to be certain as to:- • payment: who pays, to whom is payment made, and how much • the form in which payment is to be made • whether payment is to be immediate or in stages • the mechanism for default of payment • the provision of interest • the costs of the litigation • the costs of the mediation • any public statements • the discontinuance or withdrawal of proceedings • any special clauses dealing with enforceability • who is the signatory, his or her status or authority. 7. There will be occasions when you can do no more than agree outline heads of agreement, but this should be avoided wherever possible. Saving an hour at the end of the mediation by agreeing only outline heads of agreement exposes you to the risk of further disputes in which the argument shifts from its original subject matter to contesting what has been agreed. It is essential that the intention of you and the other party/parties is made plain, and there is at least sufficient detail to ensure that an impartial reader would have a clear idea of precisely what has been agreed. If there is no time to put in the complexity of the mechanics of the transaction, or, for example, the tax implications have not been advised upon or worked out, at least draw a distinction between the agreement itself and the mechanics for performing it.