Parties Reaching Full Settlement in Mediation Need Not Follow Certain Disclosure Rules Otherwise Applicable to Trials

In the November 2013 published case of Marriage of Woolsey, the Court of Appeal dealt with a case involving the following facts: The parties married in 2001 and had two children. They separated in 2009.  Husband persuaded Wife to participate in a church-sponsored reconciliation session that turned into a mediation of issues regarding division of property, support, and custody of their two children. This voluntary process produced an MSA that divided the community property, permanently waived Wife’s entitlement to spousal support and put a parenting plan that provides the children would remain in Wife’s primary care. The agreement states the parties had disclosed all of their financial matters during the mediation.  Wife filed her proof of service of her preliminary and final declaration of disclosure shortly thereafter.  Husband filed his proof of service of only his preliminary declaration of disclosure but not his final.

Husband apparently had second thoughts about the agreement the parties reached, which was the reason he refused to file his final declaration of disclosure.  Absent him filing proof of that final DOD, the court will not enter the judgment.  Parties are free to sign a form “waiving” service of the final declaration of disclosure, but that did not occur in this case.

Because Husband wanted to renege on the agreement, Wife filed a motion under Cal. Code of Civil Procedure (CCP) 664.6.  This code section allows a party to request that the court enter a judgment based on the parties prior written agreement or an agreement made in open court.

The law requires both parties to serve final declarations of disclosure in divorce cases, or execute a written waiver.  (See Fam. Code 2105).  However, this case seems to provide an exception to this rule. Parties are permitted to mediate the resolution of their case and if they do, they do not have to follow the “procedural” rules that go along with family law trials.  Elden v. Superior Court, (1997) 53 Cal.App.4th 1497, 1507-1508 held that if parties “agree to submit their dispute to non-judicial [arbitration or mediation], [they remove their] ‘controversy … from the procedures applicable to trials.’ ” (Elden at p. 1508.) Compliance with the disclosure requirements is therefore excused because the parties “are entitled to adopt other, more summary procedures for financial disclosure.” (Elden at pp. 1508-1509.)  The Court of Appeals here agreed with the Elden case.  The Court said that because the parties had “fully” disclosed all their assets and obligations during mediation, down the nitty-gritty details, a full disclosure was made.  Moreover, because Husband had urged Wife to mediate and he was the one who refused to execute the final declaration of disclosure, he should not benefit by refusing to acknowledge the parties’ agreement.

A preliminary declaration of disclosure must be served by each party prior to the entry of judgment. (Irmo McLaughlin, (2000) 82 Cal.App.4th 327, 331.) A preliminary declaration of disclosure using a form approved by the Judicial Council must be served unless excused by a court order. (§ 2107.) This holds true for every party going through a divorce in California.

The declaration of disclosure forms are extremely important and should be completed with care and diligence.

For more information about Los Angeles divorce, disclosures or mediation, contact our office today.