For months the international dispute resolution community has anticipated August 7, 2019, as the signing date for an important new multilateral treaty. Following the path of the highly influential New York Convention and its influence in the realm of international arbitral awards, the newly signed United Nations Convention on International Settlements Resulting from Mediation—or “Singapore Convention on Mediation”—sets new standards for broad, expeditious, international enforcement of qualifying mediated settlement agreements.
A key question for future litigants and their counsel will be whether the scope of the Singapore Convention can embrace the mediated settlement agreement in a dispute. The criteria include: (1) an agreement; (2) resulting from mediation; (3) concluded in writing by the parties; (4) to resolve a commercial dispute; which (5) at the time of its conclusion is “international.” (Art. 1(1).) For purposes of the Singapore Convention, a settlement agreement may be considered “international” if at least two parties to the settlement agreement have their places of business in different countries, or importantly, if the country in which the settling parties have their places of business is different from either the country in which a substantial part of the obligations under the settlement agreement is performed or the country with which the subject matter of the settlement agreement is most closely connected. (Id.)
This means that in addition to disputes between parties from different countries, domestic commercial disputes between American parties that have an international dimension also may qualify for enforcement under the Singapore Convention. American litigators should be aware of the enhanced enforceability of a settlement agreement falling under the Singapore Convention and the resulting opportunities to collect against an adversary’s international assets.
Significantly, counsel should ensure that the mediation of a qualifying dispute results in a settlement agreement enforceable under the Singapore Convention. Among other things, the Convention requires a signed settlement agreement, as well as evidence that the agreement resulted from the mediation. (Art. 4(1).) Additionally, courts of a party to the Convention may decline to grant relief in certain avoidable circumstances, such as nonfinality of the agreement or a subsequent modification to the agreement (art. 5(1)(b)), settlement obligations that are not clear or comprehensible (art. 5(1)(c)(ii)), or a failure by the mediator to disclose circumstances that raise justifiable doubts about the mediator’s impartiality or independence (art. 5(1)(f)).
The Singapore Convention applies only to settlement agreements concluded after the date when the Convention enters into force for the Party to the Convention concerned. (Art. 9.) The Convention enters into force six months after deposit of the third instrument of ratification, acceptance, approval, or accession. (Art. 14(1).)
Michael Massengale is a former appellate judge with a Houston-based alternative dispute resolution practice, Massengale PLLC, focusing on domestic and international arbitration, as well as mediation of complex disputes.