Pursuant to NJ Court Rule 5:5-5, all counties in the state are required to maintain an Early Settlement Panel (ESP) program. The goal of the program is to promote resolution of economic issues prior to trial. Most divorce cases will settle prior to trial either at an ESP or otherwise. The panels are usually comprised of two-three lawyers experienced in family law. Each county’s bar association is responsible for maintaining a list of eligible lawyers for their county. Generally, each attorney should have at least five years of experience in family law matters in order to serve as a panelist. Additionally, some counties offer specialized panels for complex cases wherein the panel will feature some of the most experienced attorneys practicing matrimonial law.
Procedurally, each party should submit a memo to the panel either prior to or at the time of the ESP. The rule contemplates submission five days prior however in practice the timing and method for submission of the ESP memo is also governed on a county-to-county basis. Some counties will allow submission the day of the panel while others set a deadline several days in advance to allow review prior to the panel date. In any event, the memo should outline the issues in the case and narrow which issues need to be resolved as well as any issues that have already been settled. Issues to be considered during an ESP include alimony, child support, college and private school costs, equitable distribution, debts, life insurance, tax issues, and counsel fees.
THE IMPORTANCE OF DISCOVERY
It is important to make sure discovery is complete prior to the ESP to ensure the panelists can be effective and provide a comprehensive recommendation. The date for completion of discovery will be set at the initial case management conference where the date for the ESP may also be set. Valuations on marital property should also be completed prior to the ESP so accurate numbers can be used when considering an appropriate equitable distribution scheme.
Additionally, parties should be sure their Case Information Sheet (CIS) is completed and up-to-date. The Case Information Sheet is one of the most important documents that will be completed in the divorce action. The ESP panelists and/or the judge can rely on the representations in this document. Parties will be held to their income and expenses as listed on their CIS. The expenses should reconcile with the income listed. This is another important reason to keep the form up-to-date and revise as numbers change. This is especially true for cases that may take several years to resolve.
Cases that settle at the panel can conclude that day. The panelists will review the submitted memos, listen to attorney presentations, briefly deliberate and then offer a recommendation. The parties can take the recommendation or negotiate from there. The terms of any agreement can be reduced to writing or put on the record and the divorce decree can be issued. The recommendations from the panel are confidential however and will not be disclosed to a judge in subsequent proceedings unless both parties agree. Its possible parties can be directed to an ESP more than once if they are unable to settle the first time. If the ESP never leads to settlement, the next step is likely another form of alternative dispute resolution, e.g. economic mediation or binding arbitration. Benefits of settling at an ESP include minimal legal fees and the ability for each party to promptly move forward with their lives with economic and personal certainty.