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The Minnesota Court of Appeals held that a mediated settlement agreement was binding and enforceable because it met statutory requirements for a binding settlement agreement.
In Chesney v. Hypertension Diagnostics, Inc., No. A05-2210, 2006 WL 2256590 (Minn. App. August 8, 2006), Hypertension Diagnostics, Inc. (“HDI”) and two former employees settled the latter’s whistleblower claims at a voluntary mediation. They memorialized the settlement in a written agreement. When the parties later failed to agree on final language, the former employees brought a motion to enforce the agreement. The trial court granted their motion.
On appeal, HDI argued that the written settlement agreement was “merely a preliminary document” and thus not enforceable. The Court disagreed, finding that the agreement met the requirements of Minn. Stat. § 572.35(1) (2004), which provides that a settlement agreement is binding if “it contains a provision stating that it is binding” and includes certain advisories.
Also, as the Court noted, the parties’ agreement provided that it was not contingent on the preparation of the “formal documents” necessary “to facilitate the detail of [the] agreement.” Accordingly, the Court held that the agreement was enforceable.
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