Reference no: EM132223788

Facts: A family dispute over ownership of what had been the family home in Woburn, Massachusetts, prompted Sparrow to file a complaint in a state trial court against her sister, Susan Demonico, and Susan’s husband, David D. Demonico (Demonicos). Prior to trial, the parties resolved their differences by entering into a settlement agreement reached during voluntary mediation. However, when Sparrow attempted to obtain a court order to enforce the agreement, the Demonicos argued that the contract was void because Susan Demonico lacked the capacity to enter into the agreement. A trial court agreed with the Demonicos, ruling that the contract was void because it may have been the product of an emotionally overwrought state of mind and Susan was not able to understand in a reasonable manner the nature and consequences of her actions. The appellate court reversed the trial court’s decision and issued an order enforcing the settlement agreement.

Issue: Did Demonico’s condition establish incapacity as a defense to the mediation settlement agreement?

Ruling: No. Although the court ruled that she could establish incapacity even without proof of a permanent medical condition, Demonico did not provide any credible medical evidence to indicate that she didn’t have the ability to comprehend the reasonableness of the settlement terms.

Case Questions:

1. What does the court say was missing from the Demonico’s argument about capacity?

2. What factors went into the trial court’s decision to void the settlement agreement?