The Difference between Binding and Non-Binding Mediated Settlements

Mediation has certain merits and many couples successfully resolve their disputed issues through mediation. When signing a mediation settlement agreement (MSA), couples have two options. An MSA can be either binding or non-binding. This fact bears significant importance and is worth explaining.

How a non-binding mediation agreement works

Under the Texas Family Code, either spouse can revise or reject a non-binding mediation settlement agreement before the court makes this settlement part of the divorce decree. Also, if the court finds the terms of the settlement are not just and right, it can request that spouses revise it or can schedule a contested hearing. If the court determines that the terms of the couple’s MSA are just and right, it can approve the agreement and incorporate it or refer to it in the final decree.

This type of settlement agreement allows some breathing room for spouses to reconsider whether the settlement meets their needs. For example, they may realize that the settlement did not fully address some aspect of property division. A non-binding agreement allows them the chance to sort that out through further mediation, a negotiated settlement or a scheduled court hearing.

How a binding mediation settlement agreement works

Based on the Texas Family Code § 6.602 as long as the MSA meets the requirements of containing boldfaced type stating that the MSA is not subject to revocation and both spouses along with their attorneys (if present) sign the agreement, it is binding. How binding is binding? A party is entitled to judgment on the mediated settlement agreement notwithstanding Rule 11, Texas Rules.

According to the court’s interpretation of this statute in the case Toler v. Sanders, parties are entitled to judgment immediately after signing the agreement. And Rule 11 has no bearing on it. Rule 11 is a part of the Texas Civil Procedures statutes that defines valid agreements. However, not even such Rule 11 agreements can affect a binding MSA agreement.

Before committing to a binding or non-binding MSA, discuss all the details of your situation with a Texas divorce lawyer.