How binding is the standard clause in a settlement contract, a.k.a. minutes of settlement, that requires the parties to attempt mediation or a 4x negotiation meeting before being allowed to bring a court application?

For the most part, Queen’s Bench Justices in family chambers have been upholding and showing respect for the requirements of that clause, and would adjourn or refuse to hear a court application when the person responding or defending against the court application brought that clause to the Justice’s attention. The Court of Appeal in Henderson  v. Henderson, 2016 ABCA 256, recently reversed the decision of a Queen’s Bench Justice who did not uphold that clause. In the Henderson decision, the Court of Appeal wrote:

Having agreed to this requirement, the [person bringing a court application] cannot simply ignore it, and there was no basis for the Chambers Judge to dispense with mediation. Dispensing with mediation merely rewards the [person who brought the court application] for breaching the provisions of the Settlement Agreement.

Court of Appeal decisions are binding on all Queen’s Bench Justices. So now all Queen’s Bench Justices, without exception, will need to uphold the requirements of that clause in a settlement contract.

I have been using the word contract because for some time now the court system has recognized that individuals involved in a dispute have the right to contract into a dispute resolution process outside the court system.

The Court of Appeal in Abernethy, 2005 ABCA 103, had dealt with a situation in which the litigants contracted out of the standard court litigation process, and into an arbitration process, albeit an arbitration conducted by a Queen’s Bench Justice. The Court of Appeal in Abernethy enforced the outcome of the arbitration, and also that the arbitrator’s decision could not be appealed.

Last year in an unreported decision, Sagrafena v. Sagrafena, 4806 016173, December 8, 2015, Justice Langston found that a divorcing couple had contracted out of the Queen’s Bench rules of court when they decided to negotiate in the collaborative divorce process. In his oral decision, Justice Langston stated:

To suggest that while in the midst of a collaborative law process, the parties must simultaneously be conscious of a plot running inexorably towards litigation is to defeat the whole purpose of the collaborative law process.

Justice Langston was in effect upholding the parties’ contract/ choice of dispute resolution process.

I believe that the court system in Alberta is slowly facing the reality that it too has limited resources, it needs to create incentives for people to resolve their disputes outside the court system, and that this will improve access to justice for the public. Upholding and giving respect to contracts to resolve dispute outside the court system is one small part of creating those incentives.

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