Court of Appeals Affirms Enforcement of Mediated Settlement in Custody Case

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By Lee Hornberger

The Michigan Court of Appeals recently increased the flexibility of what parents can agree upon in mediation. Rettig v Rettig, 322 Mich App 750; 912 NW2d 877 (2018). Rettig is the most recent Michigan Court of Appeals published decision concerning the enforceability of a mediation settlement agreement since Vittiglio v Vittiglio, 297 Mich App 391; 824 NW2d 591 (2012), lv dn 493 Mich 936; 825 NW2d 584 (2013).1  Rettig seriously impacted the holding of Vial v Flowers, unpublished per curiam opinion of the Court of Appeals, issued September 22, 2016 (Docket No. 332549), and other unpublished decisions concerning the relationship of the Child Custody Act, 722.21 et seq, and mediated settlement agreements (MSA).

Court of Appeals decisions  before Vial

Roguska v Roguska, unpublished per curiam opinion of the Court of Appeals, issued September 29, 2009 (Docket No. 291352), held that the Circuit Court applied the proper custody standard under the Child Custody Act, did not err in rejecting a custody MSA, and finding that no established custodial environment existed. The MSA was signed by the mediator, the parties, and the attorneys. The parties said the consent judgment was consistent with the MSA. The plaintiff testified that the defendant “lied” during the mediation. The Circuit Court rejected the MSA. The Court of Appeals held that the Child Custody Act required the Circuit Court to independently determine custody that is in the best interests of the children.

In Bono v Bono, unpublished per curiam opinion of the Court of Appeals, issued November 19, 2015 (Docket No. 325331), the Court of Appeals held that the Circuit Court abused its discretion by entering a MSA judgment of divorce, which included custody, without first considering the best interest factors. The Child Custody Act required the Circuit Court to determine what custodial placement was in the best interests of the children, even if the parties utilize alternative dispute resolution to reach a MSA regarding custody.

In re BJ, unpublished per curiam opinion of the Court of Appeals, issued January 20, 2011 (Docket No. 296273), held that domestic relations mediation is not binding but is subject to acceptance or rejection by the parties. The parents' utilization of alternative dispute resolution did not deprive the court of its authority and obligations under the Child Custody Act.

Vial

In Vial, the Court of Appeals rejected the wife’s contention that the parties had not entered into a binding MSA concerning custody even though their 2015 mediation had resulted in an MSA. Vial held that the Circuit Court had failed to adequately consider the child’s best interest factors under MCL 722.23 to determine whether an established custodial environment existed before it entered a custody judgment in April 2016. Vial said a party is bound by the party’s signature on a custody MSA as long as the Circuit Court agrees that the MSA is in the best interests of the child. The signed MSA was binding on the parties subject to the Circuit Court doing a best interests analysis. Although the parties entered into an otherwise binding custody agreement, the Circuit Court was not relieved of its obligation to examine the best interest factors. By signing and entering a judgment of custody, the court implicitly acknowledges that it has (1) examined the Child Custody Act best interest factors, (2) engaged in a profound deliberation as to its discretionary custody ruling, and (3) is satisfied that the custody order is in the child’s best interests. Given the custody MSA, an evidentiary hearing was not necessarily required because the Circuit Court had satisfied itself concerning the child’s best interests in consideration of the custody MSA. Vial held the Circuit Court also erred by not considering whether an established custodial environment existed. An established custodial environment is an environment in which, over an appreciable time, the child naturally looks to the custodian in that environment for guidance, discipline, the necessities of life, and parental comfort.

Rettig

In Rettig, the parties signed a MSA concerning custody. The Circuit Court entered a judgment of divorce that incorporated the MSA over the objection of one parent that the Circuit Court should have a hearing concerning the Child Custody Act best interest factors and whether there was an established custodial environment. The Court of Appeals affirmed. The Court of Appeals stated, although the Circuit Court is not necessarily constrained to accept the parties’ stipulations or agreements verbatim, the Circuit Court is permitted to accept the stipulations and agreements and presume, at face value, the parties meant what they signed. The Circuit Court remains obligated to reach an independent conclusion that the parties’ agreement is in the child’s best interests, but the Circuit Court is permitted to accept an agreement where the dispute was resolved by agreement of the parents. In addition, given the agreement, the Circuit Court was not required to make a finding of an established custodial environment.

The Court of Appeals wrote:

“The agreement between the two parties was signed by both parties and therefore valid. The trial court concluded that the agreement appeared to be in the best interests of the child and included it in the court’s order. In context, the trial court was not required to make a finding of an established custodial environment … . The evidence shows that there was no clear legal error or abuse of discretion falling outside of the range of principled outcomes. Defendant was aware of the provisions in the agreement that settled the disputes over parenting time and custody, shown by his signature. The trial court properly entered the order effectuating the parties’ agreement, and properly declined to grant defendant’s motion for reconsideration, rehearing, and relief from judgment.” (Emphasis added.)

Rettig raises the following questions.

• What effect does Rettig have on Vial?

• Was it appropriate for the Rettig decision to refer to the Vial holding as to the existence of an established custodial environment holding as “nonsensical?”

• Does the existence of an established custodial environment of a child have any significance beyond establishing the appropriate burden of proof?

• If Rettig resulted in the demise of Vial, did Vial deserve a better demise?

• If Vial had never existed, would Rettig have been a published decision?

Conclusion

Rettig disapproved the prior holdings of Vial and other decisions that courts should give little deference to a custody MSA and must analyze whether an established custodial environment exists under the Child Custody Act even when there is a custody MSA. Rettig was followed in Brown v Brown, unpublished per curiam opinion of the Court of Appeals, issued November 27, 2018 (Docket No. 343493). In Brown, the Court of Appeals concluded that the case before it was indistinguishable from Rettig where the Court of Appeals had rejected a challenge to a valid judgment of divorce that included a custody and parenting-time provision from an MSA. According to Brown, Rettig relied on the parties’ mutual agreement to the custody and parenting-time arrangement to uphold the judgment.

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1In Vittiglio v Vittiglio, 297 Mich App 391; 824 NW2d 591 (2012), lv dn 493 Mich 936; 825 NW2d 584 (2013), the Court of Appeals affirmed the Circuit Court’s holding that an audio recorded MSA was binding and a “certain amount of pressure to settle is fundamentally inherent in the mediation process.” The Court of Appeals affirmed the Circuit Court that plaintiff was liable for sanctions because the plaintiff’s motions were filed for frivolous reasons and the Circuit Court did not abuse its discretion in awarding costs and attorney fees.
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Lee Hornberger is Immediate Past Chair of the Alternative Dispute Resolution Section of the State Bar of Michigan. He is included in The Best Lawyers of America 2018 and 2019 for his work in arbitration, and on the 2016, 2017, and 2018 Michigan Super Lawyers lists for alternative dispute resolution. He has received a First Tier ranking in Northern Michigan for Arbitration by U.S. News – Best Lawyers® Best Law Firms in 2019.   
He has received the George N. Bashara Jr. Award from the State Bar’s ADR Section in recognition of exemplary service and the Albert Nelson Marquis Lifetime Achievement Award. He is a member of The National Academy of Distinguished Neutrals and the Professional Resolution Experts of Michigan (PREMi), an invitation-only group of Michigan’s top mediators.
He is former editor of The Michigan Dispute Resolution Journal, former chair of the ADR Committee of the Grand Traverse-Leelanau-Antrim Bar Association, former member of the State Bar’s Representative Assembly, former president of the Grand Traverse-Leelanau-Antrim Bar Association, and former chair of the Traverse City Human Rights Commission.
He is an arbitrator with the American Arbitration Association, Federal Mediation and Conciliation Service, Financial Industry Regulatory Authority, Forum, Michigan Employment Relations Commission, National Futures Association, and National Mediation Board.
While serving with the U.S. Army in Vietnam, he was awarded the Bronze Star Medal and Army Commendation Medals. The unit he was in was awarded the Meritorious Unit Commendation and the Republic of Vietnam Gallantry Cross Unit Citation with Palm.
He holds his B.A. and J.D. from The University of Michigan and his LL.M. in Labor Law from Wayne State University.
He can be reached at 231-941-0746 and leehornberger@leehornberger.com.

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