First Court of Appeals of Texas Holds a Cooperative Law Agreement in a Divorce Proceeding Does Not Violate Public Policy

The First Court of Appeals of Texas held in a case of first impression that a cooperative law agreement in a divorce proceeding does not violate public policy.

In In re Mary Lynn Mabray, No. 01-09-01099-CV (Tex. App.-Hous. (1 Dist.) August 31, 2010) the relator, Mary Lynn Mabray, challenged a trial court’s order denying her motion to disqualify counsel from representing her husband, Gary Allen Mabray, and her motion to revoke consent to arbitration. In October 2008, the relator sought a divorce from her husband after 35 years of marriage. In February 2009, the parties signed a four page document titled “Cooperative Law Dispute Resolution Agreement” (Agreement). The Agreement forbade formal discovery unless agreed upon by the parties, relied on “good faith” informal discovery and provided that the cooperative law process would cease and the parties would submit the divorce to arbitration if the divorce was not settled by April 30, 2009. Additionally, the Agreement specifically cited to the arbitration and informal settlement conference provisions of the Texas Family Code. (TEX. FAM.CODE ANN. §§ 6.601, 604.)

The parties filed a “Joint Motion for Referral to Arbitration” on March 11, 2009 asking the court to submit their case to arbitration if they failed to resolve their case by agreement on or before April 30, 2009. The Motion also asked the court to appoint a person agreed to by the parties as the arbitrator. The trial court signed the requested order on March 18, 2009. Because a final decree of divorce was not submitted to the court by April 30, 2009, the cooperative law process ceased by its own terms. Nowadays, many people use an app to grab cheating evidence from their partner. If you want to know more, this article about which is better find out mspy vs spybubble for the truth can help you with that.

The relator asserted to the trial court that the Agreement sought to “contract around” Texas’s collaborative law statute, section 6.603 of the Texas Family Code in an effort to allow her husband’s attorney to continue to represent him in litigation once the collaborative process had failed. Her husband sought to compel arbitration and argued that the Texas collaborative law statue is inapplicable to cooperative law agreements. On October 30, 2009, the trial court signed an order compelling arbitration.

The relator sought a writ of mandamus from the Court of Appeals directing the trial court to overturn its order compelling arbitration on public policy grounds and its order denying her motion to disqualify her husband’s attorney.

The Court of Appeals first addressed the differences which exist between cooperative and collaborative law:

Akin to collaborative law, cooperative law “is a process which incorporates many of the hallmarks of Collaborative Law but does not require the lawyer to enter into a contract with the opposing party providing for the lawyer’s disqualification.” Smith and Martinez, 14 HARV. NEGOT. L.REV.. at 166. “Cooperative law includes a written agreement to make full, voluntary disclosure of all financial information, avoid formal discovery procedures, utilize joint rather than unilateral appraisals, and use interest-based negotiation.” Lande and Herman, 42 FAM. CT. REV. at 284. Put simply, cooperative law agreements mirror collaborative law agreements in spirit and objective, but lack the disqualification clause unique to collaborative law agreements.

The court noted that Texas was the first state in the nation to codify collaborative law. According to the court, “cooperative law is a small but legitimate movement akin to collaborative law,” and although no state has yet codified cooperative law it is not prohibited in any jurisdiction.

The Court of Appeals first addressed whether the collaborative law statute controlled the parties’ agreement and, if not, whether a cooperative law agreement is void within the State of Texas as a matter of public policy.

The trial court determined that the parties’ Agreement was a cooperative law agreement which need not conform to Texas’s collaborative law statute. According to the Court of Appeals, the plain language of the collaborative law statute stating “a dissolution of marriage proceeding may be conducted under collaborative law procedures,” makes it elective, not mandatory. Instead, parties electing to follow collaborative law statutory procedures obtain certain benefits from the trial court.

In order to obtain these benefits, the parties must enter into an agreement providing for (1) a full and candid exchange of information; (2) suspending court intervention in the dispute while the parties are using collaborative law procedures; (3) hiring any experts jointly; (4) withdrawal of all counsel in the collaborative law procedure if the collaborative law procedure does not result in settlement of the dispute; and (5) other provisions agreed to by the parties that are consistent with a good faith effort to collaboratively settle the suit.

According to the court, the Agreement signed by the parties did not require the withdrawal of counsel if a settlement was not reached; therefore the collaborative law procedures were not applicable.

The Court of Appeals stated that although the collaborative law statute is one of four alternative dispute resolution processes the Texas legislature specifically encourages parties in divorce proceedings to utilize, they are not the exclusive forms of alternative dispute resolution available in a divorce. There is no statute or case law in Texas that explicitly prohibits any specific form of alternative dispute resolution.

Additionally, nothing in the statute or in its legislative history leads us to the conclusion that the collaborative law statute forbids parties in Texas from entering into cooperative law agreements. It has been the stated policy of Texas from at least 1987 “to encourage the peaceable resolution of disputes … and the early settlement of pending litigation through voluntary settlement procedures.” TEX. CIV. PRAC. & REM.CODE ANN. § 154 .002 (Vernon 2005). There is no statute or case law in Texas that explicitly prohibits any specific form of alternative dispute resolution.

Because Section 6.604(a) of the Family Code is silent as to the procedures that can be used in informal settlement conferences, the court concluded that “the legislature meant to cast a wide net and give the parties wide latitude in deciding how to structure them, including structuring them through a cooperative law agreement.”

The parties’ Agreement consisted of four sections: the preamble, provisions for the parties’ collaborative law agreement, provisions for the arbitration agreement and miscellaneous provisions. According to the court, the arbitration section of the Agreement would remain enforceable even if the collaborative law section of the Agreement were in violation of public policy because it was reasonable to determine that the arbitration section was an independent agreement the parties would have agreed to even without the presence of the cooperative law section.

After reviewing the underlying Texas statutes, the court concluded that the cooperative law section of the Agreement did not violate public policy.

With respect to domestic disputes, as well as in other areas of the law, Texas public policy permits and encourages parties to enter into agreements to submit disputes to various forms of alternative dispute resolution. See, e.g., TEX. FAM.CODE ANN. §§ 6.601-.604; TEX. CIV. PRAC. & REM.CODE ANN., Title 7. Texas public policy also strongly favors “preserving the freedom to contract.” Lawrence, 44 S.W.3d at 553.

Additionally, the court stated neither the common law nor the collaborative law statutes prohibit the practice of cooperative law in Texas and the relator “offered no persuasive evidence as to why cooperative law agreements cannot be negotiated by parties within Texas’s generous ADR ambit. See TEX. CIV. PRAC. & REM.CODE ANN. § 154.002. As we have noted, experts generally neither laud nor condemn it, but note its benefits and detriments as a legitimate ADR procedure akin to collaborative law.”

The court went on to state that retention of counsel in litigation, in light of possible disclosure of privileged information “poses nearly the same risk of disclosure of privileged information,” in collaborative law as cooperative law since nothing prevents an opposing party privy to a confidential disclosure from sharing the information with new counsel.

The court refused to allow the relator to withdraw her consent to arbitration despite that a party may withdraw consent to a Rule 11 settlement agreement prior to judgment because the rule only allows parties to revoke their consent to the entry of an agreed judgment, not the process that could lead to such a judgment. Arbitration generally leads to a judgment that one of the parties does not agree to. Additionally, the relator could not revoke her consent to arbitration after having twice asked the court to enforce the parties’ arbitration provision.

The relator’s petition for a writ of mandamus was denied with one Justice dissenting by stating the cooperative law Agreement was an illegal contract that conflicted with the Texas collaborative law statute and was therefore void.

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