“SECRETARY OF LABOR,Complainant,v.AERLEX CORPORATION,Respondent.OSHRC Docket No. 85-1257_ORDER_An order of Judge Louis G. LaVecchia approving a settlement agreement inwhich Respondent withdrew its notice of contest to citations andpenalties of $58,000 proposed therefor is before the Commission forreview. The citations were issued following an explosion which,according to the attorney who filed Respondent’s notice of contest,totally destroyed Respondent’s business. In a subsequent letter filedwith the judge, Respondent, then appearing without counsel, stated thatalthough it had a defense to the citations it was unable to pursue itsdefense because it no longer had any income and had exhausted itsfinancial resources. Therefore, Respondent stated that it entered intothe settlement agreement despite its defense.Thereafter, Respondent, once again appearing through counsel, filed withthe judge a motion to withdraw from the settlement agreement, restatingRespondent’s prior reason for entering into the agreement and alsoasserting that Respondent assented to the agreement \”without benefit ofcounsel and without legal advice\”[[1]] and that \”Respondent was notaware of the ramifications of entering into the settlement agreement.\” The motion also asserted that because of the \”pressures\” on Respondentit did not enter into the agreement \”freely and without coercion.\” Judge LaVecchia did not rule on this motion.In opposition to Respondent’s motion, the Secretary has filed affidavitswhich indicate that discussions were conducted with Respondentconcerning the effect of a settlement on possible criminal prosecution. The Secretary’s affidavits do not otherwise address the matters raisedin Respondent’s motion to withdraw from the settlement agreement,particularly Respondent’s concerns regarding its financial status.The Commission encourages voluntary dispositions by parties toCommission proceedings. At the same time, however, the Commission mustbe assured that a proposed settlement represents a genuine agreementbetween the parties and a true meeting of the minds on all provisionsthereof. _See_ _Metro Waterproofing, Inc._, 85 OSAHRC ____, 12 BNA OSHC1601, 1986 CCH OSHD ? 27,535 (Nos. 85-321 & 85-430, 1985) and _WheatonInjection Molding Co_., 82 OSAHRC 26\/B11, 10 BNA OSHC 1589, 1982 CCHOSHD ? 26,052 (No. 81-1412, 1982). _See also_ _Marshall v. SunPetroleum Products Co_., 622 F.2d 1176 (3d Cir. 1980), _cert denied_,449 U.S. 1061 (1980) (Secretary allowed to withdraw from settlementagreement under certain circumstances).In this case the submissions of the parties raise a dispute as towhether Respondent fully understood the provisions of the settlement andintended to enter into an agreement providing for the affirmance of allcitations and the assessment of a substantial penalty therefor. Accordingly, we set aside the judge’s order and remand this case for aruling on Respondent’s motion to withdraw from the settlement. Thejudge shall conduct a hearing on Respondent’s objections to thesettlement agreement or shall otherwise afford the parties anopportunity to submit evidence in support of their respectivepositions.[[2]] The judge shall make factual findings with respect tothe grounds Respondent asserts for withdrawal and shall allow theparties to submit arguments on the question whether on the facts asfound a sufficient basis exists on which to set aside the settlementagreement. In the event the judge grants Respondent’s motion towithdraw, he shall conduct further proceedings as appropriate.FOR THE COMMISSIONRay H. Darling, Jr.Executive SecretaryDATED: AUG 19 1986————————————————————————BUCKLEY, Chairman, DissentingI dissent because, even if the unsworn representations of counsel inRespondent’s motion to withdraw from the settlement agreement are takenas true, they do not constitute a legal basis for setting aside thejudge’s order approving the settlement agreement. Respondent claimsthat it did not enter into the agreement freely and without coercion,but that conclusion cannot reasonably be inferred from the factualassertions made. A body that freely permits _pro_ _se_ representationshould not lightly conclude that failure to consult counsel prevents anemployer from entering into settlement \”freely and without coercion.\”As the majority states, the Commission encourages the parties todisputes before us to reach agreements that voluntarily dispose of thedisputed issues. In this case, Judge LaVecchia was assured thatRespondent wished to settle as stated in the settlement agreement. In aletter submitted by Respondent with the signed settlement agreement,Respondent’s president indicated that he wanted to withdraw the noticeof contest in order to terminate the costly litigation despite having a\”complete defense.\” Respondent signed the settlement agreement, whichplainly stated that the withdrawal \”has been made freely and withoutcoercion\”; that the penalties proposed total $58,000; and that\”Respondent understands and agrees that, as a result of its withdrawalof its notice of contest, the citation and penalties proposed thereforeshall become a final order of the Commission.\”Nothing that Respondent has submitted to us since signing the settlementagreement indicates that there was any lack of understanding as to theterms and effect of the settlement agreement. In fact, Respondent hassimply repeated what was either told to or evident to the judge when thesigned settlement was submitted to the judge before the judge approvedit–that Respondent entered into the settlement agreement while lackingcounsel, during financial difficulties, and despite having a \”completedefense.\” Respondent’s motion does not state how any of the plain termsof the settlement were misunderstood and, although Respondent said thatit was not aware of the ramifications of the settlement agreement sincethey were not explained by counsel, Respondent has not stated whatramifications were not understood. The Secretary’s affidavits representthat Respondent had been represented by counsel during discussions ofsettlement at an informal conference. From the Secretary’s affidavit italso appears that the possibility of criminal charges even if the civilcase was settled was discussed at that time and again immediately priorto the final settlement agreement. In view of this, it appears thatRespondent’s president was fully aware of the circumstances surroundingthe settlement agreement and had an adequate opportunity to understandthe plainly stated terms of it.To set aside the judge’s order in this case involving numerous chargesof serious and willful violations and a large penalty when Respondenthas not even alleged a sufficient basis for out doing so, will seriouslyundermine the policy to encourage settlement. We have little Commissionprecedent to guide the judge’s decision on remand. The proper course ofaction, in my judgment, would be to permit both parties to submit briefsand affidavits in support of their position to the Commission. Shouldthey convince us that the allegations, if proven, would constitute asufficient basis for permitting an employer to withdraw from asettlement agreement, we can then remand the case for proof of theallegations.————————————————————————SECRETARY OF LABOR,Complainant,v.AERLEX CORPORATION,Respondent.OSHRC Docket No. 85-1257_ORDER_The settlement agreement submitted for approval by the parties is approved.Incorporated in the agreement is a motion by the respondent to withdrawits notice of contest to the citation which initiated the proceeding.Accordingly, the respondent’s motion to withdraw its notice of contestis granted, and the citation is affirmed in all respects.A civil penalty of $58,000 is assessed for the violations affirmed.So ORDERED.Louis G. LaVecchiaJudge, OSHRCDATE: June 13, 1986FOOTNOTES:[[1]] The attorney who had originally represented Respondent withdrewprior to the execution of the settlement because of a fee dispute withRespondent.[[2]] The dissent agrees that this case merits further proceedings onboth the factual and legal issues presented. The dissent, however,would require the Commission to rule on a legal issue–the circumstancesunder which an employer may withdraw from a settlement agreement–beforethe nature of, and factual support for, Respondent’s objections has beendetermined. We think that the better procedure is for the judgeinitially to make the requisite factual findings. The judge may decidethat Respondent’s objections are unsupported and therefore avoidreaching the legal issue with which the dissent is concerned. Furthermore, should the Secretary feel that any error of law has beencommitted on remand, he may petition the Commission for review on thatissue.”