Maylene E. Ledbetter v. Bryan K. Ledbetter

IN THE SUPREME COURT OF TENNESSEE

AT KNOXVILLE

January 5, 2005 Session

MAYLENE E. LEDBETTER v. BRYAN K. LEDBETTER

Interlocutory Appeal by Permission from the Court of Appeals, Eastern Section

Chancery Court for Anderson County

No. 03CH3089 William E. Lantrip, Chancellor

No. E2004-00239-SC-S09-CV - Filed April 7, 2005

In this interlocutory appeal, we must determine whether the trial court had the authority to enforce

a mediated marital dissolution agreement when one of the parties repudiated its terms prior to court

approval. Here, the parties, Maylene and Bryan Ledbetter, reached, through mediation, a marital

dissolution agreement pursuant to Tennessee Supreme Court Rule 31. Shortly after the mediation,

and prior to presentation for court approval, Mr. Ledbetter repudiated the agreement. Mrs. Ledbetter

then filed a motion to enforce the terms of the agreement. Following a hearing, the trial court

overruled Mrs. Ledbetter’s motion, ruling that the oral agreement reached in mediation was not

binding and enforceable against the parties. After a thorough review of the record and relevant case

law, we conclude that because Mr. Ledbetter repudiated the terms of the agreement prior to its

presentation to the court, the trial court lacked authority to enter a judgment on the agreement.

Further, because the agreement had not been reduced to writing and signed by the parties, it is not

an enforceable contract. Accordingly, we affirm the judgment of the trial court.

Tenn. R. App. P. 9 Interlocutory Appeal; Judgment of the Chancery Court Affirmed

ADOLPHO A. BIRCH , JR., J., delivered the opinion of the court, in which FRANK F. DROWOTA , III,

C.J., and E. RILEY ANDERSON , JANICE M. HOLDER , and WILLIAM M. BARKER, JJ., joined.

Johnny V. Dunaway, LaFollette, Tennessee, for the appellant, Maylene E. Ledbetter.

James M. Webster and Michael R. Kelley, Clinton, Tennessee, for the appellee, Bryan K. Ledbetter.

Opinion

I. Facts and Procedural History

Maylene Ledbetter (Mrs. Ledbetter) and Bryan Ledbetter (Mr. Ledbetter) married in 1994.

The marital relationship deteriorated, and on April 14, 2003, Mrs. Ledbetter filed for divorce on the

grounds of inappropriate marital conduct and irreconcilable differences. Mr. Ledbetter responded

to the complaint and filed a cross-complaint.

In an apparent effort to resolve various childcare and marital property issues, the parties

agreed to mediation pursuant to Tennessee Supreme Court Rule 31. Prior to the mediation, the

mediator explained to the parties that if agreement was reached, he would prepare a summary of it.

This, he stated, was a way of memorializing the agreement.

Mediation began on October 20, 2003, and the parties reached an agreement on all matters

in controversy. Because of the late hour, the parties were not able to present the agreement to the

court for entry of judgment. Instead, the mediator audiotaped his dictation of the terms of the marital

dissolution agreement as the parties and their counsel listened. The parties and their counsel

approved the agreement as dictated.

The Agreed Order To Mediate required the mediator to file a report with the Clerk and

Master; it required also that the attorneys file, within seventy-two hours of the mediation, an order

reflecting the agreement reached. Before the deadline, Mr. Ledbetter repudiated the agreement. On

November 14, 2003, Mrs. Ledbetter filed a Motion to Enforce Mediated Settlement. Mr. Ledbetter

responded, asserting that his consent to the mediation agreement had been based upon bad advice

given by his former attorney.

Following a hearing, the trial court overruled Mrs. Ledbetter’s motion to enforce the

agreement. The trial court granted, however, her request for an interlocutory appeal pursuant to

Tennessee Rule of Appellate Procedure 9. The Court of Appeals denied the application for

interlocutory appeal. We granted interlocutory appeal in order to determine whether, under the

circumstances, the purported mediated marital dissolution agreement should be enforced.

II. Standard of Review

Whether the mediated marital dissolution agreement in this case is enforceable is a question

of law. Accordingly, our review is de novo with no presumption of correctness accorded to the

courts below. State ex rel. Pope v. U.S. Fire Ins. Co., 145 S.W.3d 529, 533 (Tenn. 2004).

III. Analysis

Mrs. Ledbetter, the appellant, contends that the audiotaped summary of the parties’

agreement is binding and judicially enforceable, notwithstanding the fact that Mr. Ledbetter, the

appellee, had repudiated it before it was presented to the court. Mr. Ledbetter insists, on the other

hand, that absent consent, a marital dissolution agreement is unenforceable and that the trial judge’s

refusal to enforce the agreement was correct. Thus, we must determine whether a mediated marital

dissolution agreement that has not been reduced to a signed writing1 and that has been repudiated

by one of the parties prior to presentment to the court is enforceable.

1

W e note that the oral dictation of the agreement was later transcribed but was never signed by the parties.

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We begin our analysis with the case of Harbour v. Brown for Ulrich, 732 S.W.2d 598 (Tenn.

1987). In that case, the appellant sought specific performance of an alleged real estate contract and

the enjoining of a threatened foreclosure action under an existing deed of trust. The appellant filed

a cross-complaint for judgment on the note secured by the deed of trust. On the day of trial, the

parties announced that they had reached an agreement, the terms of which were not announced to

the court. Prior to entry of judgment, the appellee repudiated the terms of the agreement. Holding

that the agreement was not enforceable, this Court stated that although the resolution of disputes by

agreement is encouraged, “a valid consent judgment can not be entered by a court when one party

withdraws his consent and this fact is communicated to the court prior to entry of the judgment.”

Id. at 599 (citing Van Donselaar v. Van Donselaar, 87 N.W.2d 311 (Iowa 1958)). The Court in

Harbour further held that “consent must exist at the very moment the court undertakes to make the

agreement the judgment of the court.” Harbour, 732 S.W.2d at 599 (quoting Burnaman v. Heaton,

240 S.W.2d 288 (Tex. 1951)). Thus, “until entered by the court, the matter being the question of an

agreement between the parties, either party may repudiate the agreement because of an actual or

supposed defense to the agreement.” Harbour, 732 S.W.2d at 600. “The reason for the rule is that

a consent judgment does not represent the reasoned decision of the court but is merely the agreement

of the parties, made a matter of record by the court.” Id. at 599-600 (citing Van Donselaar v. Van

Donselaar, 87 N.W.2d 311 (Iowa 1958)).

The holding in Harbour is applicable to agreements reached as the result of mediation. In

Environmental Abatement, Inc. v. Astrum R.E. Corp., 27 S.W.3d 530 (Tenn. Ct. App. 2000), the

Court of Appeals considered the enforceability of a consent order that the trial court had entered.

This order purported to reflect an oral agreement that the parties had reached during a Rule 31

mediation session. Id. at 533. Applying the principles in Harbour, the intermediate court reversed

the trial court, holding that the agreement was not enforceable because it had not been reduced to

writing or stipulated in open court. Id. at 541-42.

Citing to language in Harbour, the Court of Appeals in Environmental Abatement noted an

exception to the general rule that consent must exist at the time of judgment. That exception would

allow a court to enter a consent judgment “which merely documents an earlier agreement even where

consent does not exist at the time of entry of the written order.” Id. at 538-39. The exception

provides further that when the terms of an agreement are announced or stipulated in open court, a

judge may later enter a consent judgment based on that agreement regardless of a party’s repudiation

between the time of the announcement and the judgment. Id. at 539. This exception is rooted in the

language in Harbour, which states that “‘[t]he power of the court to render a judgment by consent

is dependent on the existence of the consent of the parties at the time the agreement receives the

sanction of the court or is rendered and promulgated as a judgment.’” Harbour, 732 S.W.2d at 599

(quoting 49 C.J.S. Judgments § 174(b)).

Considering the above-described exception, we must determine whether the oral agreement

in this case received the “sanction of the court” prior to Mr. Ledbetter’s repudiation. Mrs. Ledbetter

contends that the recording of the terms of the agreement in the mediation session was the equivalent

of an announcement in open court. Tennessee Supreme Court Rule 31, section 2(f) (2004), defines

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mediation as “an informal process in which a neutral person conducts discussions among the

disputing parties designed to enable them to reach a mutually acceptable agreement among

themselves on all or any part of the issues in dispute.” (Emphasis added). A mediator has “no

authority to dispose of a case or to enter an order disposing of a case.” Envtl. Abatement, 27 S.W.3d

at 540. In addition, Tennessee Supreme Court Rule 31, section 2(c) (2004), defines “court” as “the

Tennessee Supreme Court, the Tennessee Court of Appeals, Circuit, Chancery, Law & Equity and

Probate Courts and, when exercising the jurisdiction of courts of record, General Sessions Courts

and Juvenile Courts.” Thus, we conclude that a Rule 31 mediation session is not a court proceeding

such as would satisfy the requirement that the agreement be made in open court.

In this case, it is clear that Mr. Ledbetter repudiated the agreement prior to any judicial

consideration. Because “‘consent must exist at the very moment the court undertakes to make the

agreement the judgment of the court,’” the trial court properly held that it could not enter a judgment

on the agreement. Harbour, 732 S.W.2d at 599 (quoting Burnaman v. Heaton, 240 S.W.2d 288 (Tex.

1951)). Further, because the terms of the oral agreement were not made or announced in open court

and on the record, the court neither considered nor sanctioned the agreement. See Harbour, 732

S.W.2d at 599; Envtl. Abatement, 27 S.W.3d at 538.

Finally, as noted in Harbour, an agreement by the parties may also be analyzed under contract

law. See Harbour, 732 S.W.2d at 600. Until approved by the courts, a mediated agreement is

essentially contractual in nature. See Envtl. Abatement, 27 S.W.3d at 539 (stating that “[a]

compromise and settlement agreement is merely a contract between parties to litigation and, as such,

issues of enforceability of a settlement agreement are governed by contract law.”) Therefore, the

rules of contract law would apply.

Generally, agreements need not be in writing to be enforceable.2 Bill Walker & Assocs., Inc.

v. Parrish, 770 S.W.2d 764, 771 (Tenn. Ct. App. 1989) (citing Rodgers v. S. Newspapers, Inc., 379

S.W.2d 797, 800 (1964)). Thus, we must determine whether the law precludes enforcement of oral

mediation agreements. We first look to the rule dealing with mediation, Tennessee Supreme Court

Rule 31. Section 7 of that rule provides that evidence of statements made in the course of mediation

are inadmissible. Tenn. R. Sup. Ct. 31(7) (2004). Further, section 10(d) prohibits the mediator from

disclosing information obtained during the mediation without the consent of the parties. Tenn. R.

Sup. Ct. 31(10)(d) (2004). Based on the language in Rule 31, it would appear that a mediator may

not present evidence of an oral mediation agreement. As additional support, we look to Tennessee

Rule of Evidence 408, which provides that evidence of conduct or statements made in compromised

negotiations is not admissible to prove liability for or in validity of a civil claim. Based on those

rules, we conclude that the agreement involved here, made during the mediation and not reduced to

a signed writing, is not an enforceable contract. Accordingly, we affirm the judgment of the trial

court.

2

W e note from the record that the proposed marital dissolution agreement contemplated transfer of title to real

property, possibly implicating the application of the Statute of Frauds. See Tenn. Code. Ann. § 29-2-101(4) (2000).

However, because neither party has raised the issue nor briefed it, we pretermit it.

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The costs of mediation are taxed to the appellee, Bryan Ledbetter and his sureties, and the

costs of appeal are taxed to the appellant, Maylene Ledbetter and her sureties, for which execution

may issue if necessary.

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ADOLPHO A. BIRCH, JR., JUSTICE

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