Agreements Resulting from Mediation: Judicial Review, Avoidance, Enforcement
I. Introduction
Issues such as legal nature, legal effects, avoidance of ADR settlements are not directly addressed by the EU Directive 2013/11 on Consumer ADR. Nevertheless, it is the purpose of this article to deal with these aspects (as far as agreements resulting from mediation are concerned), since the success of ADR will depend to a considerable extent on the capacity of settlement agreements to achieve a lasting resolution of the dispute.
The major debates on mediation in the mid-1980s in the US and mid-1990s in Europe, as well as the implementation of mediation programs, repre-sented an essential development in the landscape of dispute resolution in western countries. One may wonder whether this new institutional setting should challenge (or at least reframe) the starting point that the legal rules which apply to settlements achieved by the parties without the assistance of a mediator also apply to agreements resulting from mediation. Before the in-stitutionalization of mediation, settling a dispute through an out-of-court agreement or litigating the case before courts was a choice left in the hands of the parties. After the large scale development of mediation schemes, the alternative between settlement and adjudication is rather an institutional choice, supported by a number of policies. Does this new institutional set-ting have a role to play in interpreset-ting the general rules on settlement agree-ments and applying them to the agreeagree-ments resulting from mediation? Is there a need for new rules that might bridge the gap between traditional reg-ulation on settlement agreements and more recently adopted rules on media-tion?
II. Legal Nature, Legal Effects
Agreements resulting from mediation can normally be defined as settments of a dispute by mutual concessions: ‘compromise’ in the English le-gal terminology, ‘transaction’ in French, ‘Vergleich’ in German. The his-tory of dispute resolution methods based on negotiation between the parties is closely linked to the legal concept of settlement. Settlement agreements remain the most important way for legally implementing the successful out-come of such negotiations. Legal rules that apply to settlement agreements are therefore supposed to also apply to agreements resulting from mediation. Recent legislation on mediation processes does not need to thoroughly ad-dress topics such as legal effects and avoidance of agreements resulting from mediation. Instead they deal with selected aspects, such as formal re-quirements and enforceability. In turn the essential foundation for a legally binding settlement agreement is the ordinary law of contract.
An effective settlement agreement represents the end of the dispute between the parties. Issues of law that may have formed the subject matter of the original conflict are “buried beneath the surface” of the settlement agree-ment.1 It is a matter of interpretation of the particular settlement agreement
whether the preclusion of certain issues also results in the preclusion of original claims, giving rise to a claim grounded only on the compromise (novation).2
In many jurisdictions the legal concept of settlement requires the element of mutual concessions.3 In order to enhance the flexibility of mediation, other jurisdictions may well avoid this requirement,4 or they may simply broaden the scope of mutual concessions, providing that: “through mutual conces-sions legal relationships other than the controversial one can also be created, modified or terminated”.5 This definition of the scope of mutual concessions may convey the idea that a judicial decision and a settlement agreement are both able to solve a dispute, although in quite different ways. While funda-mentally judicial decisions have to ascertain past relationships of the parties and to stick to the issues of contention, settlement agreements can broaden the view of the parties. Past problems can be resolved with a view to future developments and controversial issues can be addressed with the common ground between the parties in mind. In most cases, compared with judicial proceedings, the more flexible outcomes of a mediation process can be achieved without giving up the idea of considering the agreement resulting from mediation as a settlement that bears the hallmark of mutual conces-sions.
Mutual concessions may not interfere with public policy concerns. Accord-ingly the question of whether parties enjoy freedom in choosing the method of dispute resolution (settlements agreement may not disregard rights of which parties may not dispose) and the terms of the settlement agreement, which may not infringe mandatory rules provided by the relevant applicable law, are influenced by public policy concerns.6
III. Formal Requirements
The principle of freedom of contract entails the freedom of forms. Compli-ance with particular formal requirements proves to be costly and time con-suming. Therefore any formal requirement needs to be properly justified: “Formalities serve particular policies”.7 There are a number of purposes that formal requirements can serve: documentation and evidence (which are the most frequent), authenticity of declarations, communication, information, warning, protection against haste, expert advice, market regulation, protec-tion of creditors, public oversight, etc.8
2 Bork, Der Vergleich, 1988, 121; Franzoni, La transazione, 2001, 227. 3 Cf. e.g. § 1380 Austrian Civil Code and § 779 German Civil Code. 4 Cf. e.g. Art. 7:900 Dutch Civil Code.
5 Italian Civil Code, Art. 1965, para 2. Para 1 provides: “1. Settlement agreement is a
con-tract by means of which parties, through mutual concessions, either resolve a current dis-pute or avoid a future one”.
6 As to the concept of mandatory rules, s. Grigoleit, Mandatory Law (Fundamental
Regula-tory Principles), in Basedow/Hopt/Zimmermann/Stier (eds.), The Max Planck Encyclopedia of European Private Law, 2012, 1126 et seq.
7 So von Mehren, Formal Requirements, in David et al. (eds.), International Encyclopedia
of Comparative Law, von Mehren (ed.), vol. VII, Contracts in General, 1998.
Generally, legal rules on formal requirements of agreements arising from mediation fit quite well with the above mentioned framework. As a rule, an oral agreement is sufficient. However, a written form is often required for documentary or evidentiary purposes.9 The EU Mediation Directive requires a written form in order for the agreement to be enforceable.10 The EU Direc-tive on consumer ADR provides that parties be notified of the outcome of the ADR procedure in writing or on a durable medium and be given a state-ment of the grounds on which the outcome is based.11 At times, such as in the case of transfer of real estate, certification by a public notary may be re-quired.
Following the principle that mediation is in principle a procedure enabling the parties themselves reach a solution to their dispute, the signature of the mediator should not be required. This principle is reflected in the Italian reg-ulation. In Italy the mediator records the settlement for documentation pur-poses and signs the documentation record but does not sign the agreement.12 A few jurisdictions do however require the joint signature of the parties and the mediator.13 The mediator or the legal counsel of the parties may give ad-vice on the drafting of the agreement.14 If the assistance of legal counsel is required, it amounts to a formal requirement of agreements resulting from mediation. The rationale of this provision should be put in the context of different styles of mediation. If ‘bargaining under the shadow of the law’15 is taking place, i.e. a rights based mediation, the purpose of the mandatory as-sistance of legal counsels is clearly to provide parties with expert advice. If interest based mediation is taking place, i.e. an approach to achieving settle-ment that does not depend on reference to legal rights or the legal merits of the dispute but regards the conflict as a problem capable of solution,16 there is no rationale for the mandatory assistance of legal counsel except perhaps the goal of limiting competition from other professionals in the business of dispute resolution.
IV. Judicial Review
As to the judicial review of agreements resulting from mediation, a pivotal distinction between such agreements, on the one hand, and adjudication as well as arbitration, on the other, should be made. In individual mediation processes parties together have control over the content of the act resolving
9 Cf. Art. 1967 Italian Civil Code. 10 Cf. Art. 6.
11Directive 2013/11/EU of the European Parliament and of the Council of 21 May 2013 on
Alternative Dispute Resolution for Consumer Disputes and Amending Regulation (EC) no 2006/2004 and Directive 2009/22/EC, Art.9 lit. c.
12 Cf. Art. 11, para 3 Italian Mediation Act (Decreto Legislativo no. 28/2010).
13 Such as Spain. Villamarín López, Mediation in Spain: Dealing with Its First National
Regulation, in Hopt/Steffek (eds.), Mediation: Principles and Regulation in Comparative Perspective, 2013, 839 et seq., 848.
14 Such as in France. Cf. Deckert, Mediation in France: Legal Framework and Practical
Ex-periences, in Hopt/Steffek (eds.), Mediation: Principles and Regulation in Comparative Per-spective, 2013, 455 et seq., 472.
15 Cf. Mnookin & Kornhauser, ‚Bargaining in the Shadow of the Law’: The Case of
Di-vorce, The Yale Law Journal, 1979, Vol. 88, 950 et seq.
the dispute (they determine the terms of settlement agreements) as well as over its binding effect (settlements become binding for the parties after they have determined and agreed on their content).17 In contrast in arbitration and judicial proceedings the parties, as a rule, have control over neither the con-tent of the act solving the dispute nor over its binding effect. This difference explains why there should not be state (judicial) review of the lawfulness of individual mediation processes that give rise to a settlement agreement. Even if there are procedural flaws, they become irrelevant after the parties have agreed on a settlement, except where there are circumstances that may render the agreement ineffectual, much like under the ordinary law of con-tract.
Institutional settings and public oversight should reduce in so far as possible the risk that the absence of review of the lawfulness of single mediation pro-cesses gives rise to mass instances of unlawful mediation propro-cesses. In this context it is irrelevant whether the parties together have control over the ini-tiation of the mediation processes. The same rule (no judicial review of indi-vidual mediation processes) applies even if the parties have been forced to enter into a mediation process in the context of a dispute that is not subject to mandatory mediation. Even if it is apparent that a procedural flaw has oc-curred, there is no room for annulment if the parties have reached an effec-tive settlement agreement.
As an aside the problem of mandatory mediation should be briefly ad-dressed. Mandatory mediation, whether by law or by judicial decision, has always been a controversial subject inciting strong reactions.18 It is clear that the purest form of mediation is that of a voluntary, consensual process in which the parties are assisted to reach a settlement. Mediation is therefore most appropriate and successful when the parties enter the process voluntar-ily. The readiness of parties to mediate is an important factor in settlement. Cases are more likely to settle at mediation if the parties enter the process voluntarily rather than being pressured into the process.19 However, this is not a perfect world. Not all are fully aware of the options at their disposal and can make choices on a rational basis that reflect the full range of possi-bilities. On the other hand, parties are often not aware of the costs of the process before the courts and of the considerable length of civil proceed-ings. Moreover parties are frequently unaware of the possibility of media-tion. In order to enter into mediation voluntarily, parties need to know about this method of solving disputes. Since the government is involved as a provider of dispute resolution services, the justice system has the duty to im-plement policies directed at enabling parties to make an informed choice re-garding the dispute resolution mechanism. Introducing mandatory mediation processes, at least for a limited period of time, could be an appropriate means to that end. This provision could spread awareness of negotiated
17 Luiso, La conciliazione nel quadro della tutela dei diritti, in Rivista trimestrale di diritto e
procedura civile, vol. 58, no. 4, 2004, 1201 et seq.; Steffek, Guide for Regulating Dispute Resolution (GRDR): Principles and Comments, in Steffek/Unberath (eds., in co-operation with Genn, Greger, Menkel-Meadow), Regulating Dispute Resolution – ADR and Access to Justice at the Crossroads, 2013, 13 et seq., 16.
18 Genn, 106 et seq., esp. 108, where the mention to the Halsey judgment. 19 Genn, 113.
methods of dispute resolution and encourage parties to employ them to solve disputes.
V. Erroneous Assumptions
At this stage it is appropriate to discuss circumstances that may render a set-tlement agreement ineffectual, particularly events that may occur during the mediation process.
The first topic to be addressed is that of erroneous assumptions, which can affect the making of contracts of all sorts. All legal systems deal with the problem of whether an underlying mistake can render a contract invalid. Modern legislation tends to regulate mistake, fraud, duress (threat, coercion, undue influence20) and sometimes misrepresentation21 as different types of ‘defects of the will’.22 In this field, the fundamental problem is the conflict between respecting the parties’ intents and protecting the parties’ trust in the legal certainty and reliability of transactions. Therefore, all legal systems try to strike a balance between the setting aside of contracts on the basis of mis-takes and the exclusion or restriction of remedies to ensure the continuing validity of contracts despite the existence of mistakes.23
In the civil law systems a general tendency can be observed to restrict the impact of mistakes24 and other similar circumstances on the validity of set-tlement agreements. A relevant distinction in relation to the concept of mis-take is made between mismis-takes of law and mismis-takes of fact. In particular, the problem arises of whether a party that entered into a contract on the basis of an incorrect legal assumption may subsequently avoid the effects of that contract. As in the field of settlements agreements, where French and Italian Civil Codes provide that mistakes of law relating to the controversial issues (caput controversum) have normally no relevance on the validity of settle-ments agreement,25 continental systems have long distinguished between mistakes of law and mistakes of fact. However, Italian case law extends this rule to mistakes of fact26 and should be placed in a clear trend towards uni-fying doctrines. This encompasses mistakes in law and mistakes in fact and gives rise to the concept of fundamental mistake.27 German law treats this problem within the doctrine of “basis of the contract”
(Geschäftsgrund-lage).28 The relevant rule of the German Civil Code provides that: “(1) A contract by which a dispute or uncertainty of the parties with regard to a
le-20 In English law, undue influence is an equitable doctrine that involves one person taking
advantage of a position of power over another person.
21 In English contract law misrepresentation is a concept referring to a (fraudulent, negligent
or innocent) false statement of fact made by one party to another party, which has the effect of inducing that party into the contract.
22 Ernst‚ Mistake, in Basedow/Hopt/Zimmermann/Stier (eds.), The Max Planck
Encyclope-dia of European Private Law, 2012, 1175 et seq.
23 Ernst‚ 1175.
24 Hopt/Steffek, Mediation: Comparison of Laws, Regulatory Models, Fundamental Issues,
in Hopt/Steffek (eds.), Mediation: Principles and Regulation in Comparative Perspective, 2013, 45.
25 Art. 2052, para 2 French Civil Code: “[Les transactions] ne peuvent être attaquées pour
cause d'erreur de droit, ni pour cause de lésion”. Art. 1969 Italian Civil Code.
26 Corte di cassazione, 3 April 2013, no 5139.
27 Art. II.-7.201 DCFR; Art. 4:103 PECL; Art. 3.5 UNIDROIT PICC. 28 Bork, 359.
gal relationship is removed by way of mutual concession (settlement) is in-effectual if the facts of the case on which the contents of the contract were based do not correspond to reality and the dispute or uncertainty would not have occurred if the facts had been known. (2) If the realization of a claim is uncertain, this is equivalent to uncertainty about a legal relationship.”29 Therefore, on the basis of this rule, only common mistakes relating to un-controversial issues (caput non controversum) render a settlement agree-ment avoidable.30 If a mistake relates to the content of the declaration of will or fraud or duress occurs, a settlement agreement can be voided.31
English law makes no sharp distinction between mistakes in law and mis-takes in fact. Instead, it seems to be more likely to afford relief in case of mistakes where there has been some misunderstanding about the terms of settlement agreements or where the parties have come to an agreement on the basis of some shared false assumption of fact. Against that background the Court of Appeal held in Brennan v Bolt Burdon that a mutual mistake of law could in principle invalidate a compromise although there was no opera-tive mistake of law in that case.32 However, the scope of this ruling has been somewhat reassessed by the legal scholarship, arguing that the mere fact that parties compromise in a dispute involving competing assertions of law that are of debatable validity will not undermine the compromise, provided the assertions are made in good faith.33
A further restriction of the possibilities to avoid settlement agreements con-cerns circumstances normally referred to as gross disparity. In line with the modern policy of protecting weaker parties to a contract, recent European harmonization projects provide that one party may avoid a contract if it finds itself in a position of weakness, in particular economic distress, urgent need, improvidence, ignorance, inexperience and lack of bargaining skills are mentioned, and the other party has taken advantage of that position a way which is grossly unfair or has taken an excessive benefit.34 However, the possibility of asserting such circumstances in order to set aside a settle-ment agreesettle-ment has been explicitly excluded in some major civil law sys-tems, such as France and Italy.35
That settlement agreements may not be set aside by asserting the existence of mistakes in law or in fact relating to the caput controversum as well as
gross disparity fits very well with the principle of finality. The common
good and general interest requires that litigation must come to an end
(inter-est rei publicae ut sit finis litium). French legislation expresses this
princi-ples in a very emphatic way, referring to the binding force of settlement agreements as autorité de la chose jugée,36 force of res judicata. This
ex-29 § 779 German Civil Code (BGB). It is controversial whether or not this rule also covers
issue of law.
For the general rule on the frustration of contracts (Störung der Geschäftsgrundlage), s. § 313, para 2 German Civil Code.
30 Bork, 362.
31 § 119, para 1, § 123, para 1 German Civil Code. 32 Brennan v Bolt Burdon (2005) Q. B. 303. 33 Foskett, 59 et seq.
34 Art. II.-7.207 DCFR; Art. 4:109 PECL; Art. 3.10 UNIDROIT PICC. 35 Art. 2052 French Civil Code, Art. 1970 Italian Civil Code.
pression is not meant to give the settlement agreement the nature of a judi-cial decision but rather simply refers to the aforementioned rules, which leave less room for annulling settlement agreements than general rules on the avoidance of contracts.
As mentioned above, settlement agreements can broaden the view of the parties and help them to solve past issues with a common view of future de-velopments. What will happen if a common view, which has become a basis of a settlement agreement, is found to be incorrect? A similar problem arises if circumstances which became the basis of a settlement agreement have sig-nificantly changed since the agreement was concluded and if the parties would not have entered into the agreement or would have entered into it with different terms if they had foreseen this change. When I dealt with this problem in my first book in 199137, I came to the conclusion that the con-cerned party has a right to terminate the contract based on the general prin-ciple of good faith38. Upon further reflection, I would correct this point, ar-guing that the concerned party may demand adaptation of the settlement agreement to the extent that, taking account of all the circumstances of the specific case, he/she cannot reasonably be expected to uphold the contract without modification. Only if adaptation of the agreement is not possible or one party cannot reasonably be expected to accept it, may the concerned party terminate the contract.39
Does mediation alter this picture in any way? Of course it does. It creates potential for a more “just” resolution of the dispute than that resulting from negotiations between the parties without the cooperation of a neutral party. It is clear that the concept of justice in mediation is different from justice in adjudication.40 Adjudication fundamentally entails two components: (a) a substantive element, i.e. predetermined legal rules or standards, and (b) a procedural one, i.e. the application of such rules by a judge or arbitrator to facts in the course of a due legal process. Mediation reveals parallel, but dif-ferent, aspects. As to the substantive element, with the exception of manda-tory rules, the rules, standards, principles and beliefs that guide the resolu-tion of the dispute in mediaresolu-tion are the same as those held by the parties41. As to the procedural element, cooperation in a neutral, structured process and mediation techniques can help to introduce (or recover) a certain degree of fairness in a dispute resolution mechanism based on negotiations between the parties.42
However, one should not overstate the ability of such a structure to redress the inequality of bargaining power between the parties.43 As a rule one can effectively redress this inequality through both mandatory legal rules and an effective judicial protection of rights (if appropriate, by group litigation).
37 Caponi, L’efficacia del giudicato civile nel tempo, 1991. 38 Caponi, 214 et seq.
39 Inspiring on this point § 313 German Civil Code. 40 Genn, 117.
41 Hopt/Steffek, 44.
42 Ganner, Vertragsgerechtigkeit durch Mediation, in Österreichische Juristenzeitung, 2003,
710 et seq., 712; Hyman/Love, If Portia Were a Mediator: an Inquiry into Justice in Mediation, in Clinical Law Review, Vol. 9, 2002, 157 et seq.
On the other hand in an evaluative mediation process, where the mediator can evaluate the strengths and weaknesses of each side’s argument and ex-press a view on what might be a fair or reasonable settlement, his or her ac-tivity could be a source of erroneous assumptions by the parties, who in turn may be able to invalidate the resolution of the dispute, if the mediator’s wrongful evaluations are nevertheless taken as common uncontroversial ba-sis (caput non controversum) of the settlement agreement.44 Furthermore de-ception of one party by the mediator can provide grounds for the setting aside of the settlement agreement, depending on the existence of other ele-ments that may be required by the applicable law of contract.45 It is worth sharing the view that a mediator failing to disclose all the circumstances can jeopardize his or her independence and neutrality and also give grounds for the existence of fraud.46
However one cannot cover the category of settlement agreements based on erroneous assumptions caused by the negligent (or even deceptive) activity of mediator by applying the rules on settlements agreements and the general law of contract. The new institutional setting, whereby settlement agree-ments are promoted by mediation schemes, gives rise to a need for new rules regarding the mediator contract (in particular liability).47 Moreover, public oversight is needed to reduce as much as possible the risk that the limited judicial review of single settlement agreements gives rise to many instances of ‘unjust’ outcomes of mediations processes.48
VI. Enforcement
Settlement agreements are more likely to be complied with voluntarily. As Lord Bingham of Cornhill put it: “a settlement agreement freely made be-tween both parties to a dispute ordinarily commands a degree of willing ac-ceptance denied to an order imposed on one party by court decision. A party who settles forgoes the chance of total victory, but avoids the anxiety, risk, uncertainty and expenditure of time which is inherent in almost any con-tested action, and escapes the danger of total defeat”.49 Still, it may well happen that a party fails to comply with the settlement agreement. In this case the party that respects the agreement must be provided with a remedy to protect his/her interest in performance.
44 Greger/Unberath (eds.), Mediationsgesetz. Recht der alternativen Konfliktlösung, 2012,
158.
45 Cf. § 123, para 2 German Civil Code: “If a third party committed this deceit, a declara
-tion that had to be made to another may be avoided only if the latter knew of the deceit or ought to have known it. If a person other than the person to whom the declaration was to be made acquired a right as a direct result of the declaration, the declaration made to him may be avoided if he knew or ought to have known of the deceit” (translation provided by the Langenscheidt Translation Service). Cf. also Art. 1439 Italian Civil Code.
46 Härtling, Wirksamkeit und Vollstreckbarkeit der Abschlussvereinbarung, in
Fischer/Un-berath (eds.), Das neue Mediationsgesetz. Rechtliche Rahmenbedingungen der Mediation, 2013, 143 et seq., 149.
47 Hopt/ Steffek, 73.
48 For the issue of justice in mediation, see above.
49 Cf. Lord Bingham of Cornhill, Foreword to the Fourth Edition, in Foskett, The Law and
In a nutshell three reactions to non-performance are conceivable: specific performance, monetary compensation and termination of contract.50 In the field of settlement agreements specific performance can be achieved without bringing an action in full ordinary proceedings, if the parties have agreed on making their settlement enforceable. Most legal systems provide for the en-forceability of agreements resulting from mediation by mutual consent of the parties, if certain formal requirements are met or procedural steps taken, typically a declaration of enforceability by a court, by the parties’ counsels, by a notary public or by an administrative body.51 In this case, the loyal party may pursue (compulsory) enforcement. In some jurisdictions, such as Australia, specific performance of a settlement agreement that the other party has failed to perform will be awarded only under exceptional circum-stances.52
Prof. Remo Caponi
Full Professor of Civil Procedure University of Florence
School of Law
remo.caponi@gmail.com
50 Unberath, Contract, in Basedow/Hopt/Zimmermann/Stier (eds.), The Max Planck
Ency-clopedia of European Private Law, 2012, 377 et seq.
51 French Code of Civil Procedure (homologation, i.e. validation by the court, checking
both the existence of parties’ consent and compliance with public policy): Art. 1565 et seq., in connection with Art. 131 (conciliation, i.e. settlement agreement before the court or a conciliateur de justice ), Art. 131-12 (court annexed mediation), Art. 1534 (out-of-court mediation), Art. 1556 et seq. (procédure partecipative, a kind of out-of-court proceedings with participation of parties’ counsels: Art. 2062 et seq. Civil Code).
In German Law the parties have several possibilities of making their settlement agreements enforceable. In case of court settlements (Prozessvergleich), judicial mediation conducted by a Güterichter or settlement agreement reached before a conciliator set up or recognised by the Land administration of justice, s. § 794, para 1, no. 1 Code of Civil Procedure. Fur-thermore according to § 278, para 6 Code of Civil Procedure if judicial proceedings are pending, the parties may also provide the court with their settlement agreement and ask the court to confirm the settlement by a court order. According to § 796 a Code of Civil Proce -dure if judicial proceedings are not pending, settlement agreements reached by parties’ counsel may be enforceable (but the procedure is rather cumbersome). Finally, according to § 796 c Code of Civil Procedure the parties may have their agreement recorded by a notary public, who then may declare it enforceable. Tochtermann, Mediation in Germany: The German Mediation Act - Alternative Dispute Resolution at the Crossroads, in Hopt/Steffek (eds.), Mediation: Principles and Regulation in Comparative Perspective, 2013, 545. In English law the parties may consent to a judicial order directing them to perform the var-ious obligations provided for under the settlement or to a order directing that the agreement “be filed and made a rule of court”. The effect of making the settlement agreement a rule of court enables the terms to be enforced without the necessity of bringing an action. Foskett, 169.
The EU Mediation Directive (Art. 6) provides that agreements resulting from mediation be made enforceable upon request of the parties, unless the content of that agreement is con-trary to the law of the Member State where the request is made or the law of that Member State does not provide for its enforceability.
52 Magnus, Mediation in Australia: Development and Problems, in Hopt/Steffek (eds.),
Me-diation: Principles and Regulation in Comparative Perspective, 2013, 869 et seq., 887. In the Australian legal system agreements resulting from mediation cannot be immediately enforced. If one party breaches the agreement, the normal remedy available to the other party is damages.
