“Docket No. 85-1257 SECRETARY OF LABOR,Complainant, v.AERLEX CORPORATION,Respondent.OSHRC Docket No. 85-1257ORDER An order of Judge Louis G. LaVecchia approving asettlement agreement in which Respondent withdrew its notice of contest to citations andpenalties of $58,000 proposed therefor is before the Commission for review.\u00a0 Thecitations were issued following an explosion which, according to the attorney who filedRespondent’s notice of contest, totally destroyed Respondent’s business.\u00a0 In asubsequent letter filed with the judge, Respondent, then appearing without counsel, statedthat although it had a defense to the citations it was unable to pursue its defensebecause it no longer had any income and had exhausted its financial resources. Therefore,Respondent stated that it entered into the settlement agreement despite its defense.Thereafter, Respondent, once again appearing throughcounsel, filed with the judge a motion to withdraw from the settlement agreement,restating Respondent’s prior reason for entering into the agreement and also assertingthat Respondent assented to the agreement \”without benefit of counsel and withoutlegal advice\”[[1]] and that \”Respondent was not aware of the ramifications ofentering into the settlement agreement.\”\u00a0 The motion also asserted that becauseof the \”pressures\” on Respondent it did not enter into the agreement\”freely and without coercion.\”\u00a0 Judge LaVecchia did not rule on thismotion.In opposition to Respondent’s motion, the Secretaryhas filed affidavits which indicate that discussions were conducted with Respondentconcerning the effect of a settlement on possible criminal prosecution. \u00a0 TheSecretary’s affidavits do not otherwise address the matters raised in Respondent’s motionto withdraw from the settlement agreement, particularly Respondent’s concerns regardingits financial status.The Commission encourages voluntary dispositions byparties to Commission proceedings.\u00a0 At the same time, however, the Commission must beassured that a proposed settlement represents a genuine agreement between the parties anda true meeting of the minds on all provisions thereof.\u00a0 See MetroWaterproofing, Inc., 85 OSAHRC ____, 12 BNA OSHC 1601, 1986 CCH OSHD ? 27,535 (Nos.85-321 & 85-430, 1985) and Wheaton Injection Molding Co., 82 OSAHRC 26\/B11, 10BNA OSHC 1589, 1982 CCH OSHD ? 26,052 (No. 81-1412, 1982).\u00a0 See also Marshallv. Sun Petroleum Products Co., 622 F.2d 1176 (3d Cir. 1980), cert denied, 449U.S. 1061 (1980) (Secretary allowed to withdraw from settlement agreement under certaincircumstances).In this case the submissions of the parties raise adispute as to whether Respondent fully understood the provisions of the settlement andintended to enter into an agreement providing for the affirmance of all citations and theassessment of a substantial penalty therefor.\u00a0 Accordingly, we set aside the judge’sorder and remand this case for a ruling on Respondent’s motion to withdraw from thesettlement.\u00a0 The judge shall conduct a hearing on Respondent’s objections to thesettlement agreement or shall otherwise afford the parties an opportunity to submitevidence in support of their respective positions.[[2]]\u00a0 The judge shall make factualfindings with respect to the grounds Respondent asserts for withdrawal and shall allow theparties to submit arguments on the question whether on the facts as found a sufficientbasis exists on which to set aside the settlement agreement.\u00a0 In the event the judgegrants Respondent’s motion to withdraw, he shall conduct further proceedings asappropriate.FOR THE COMMISSIONRay H. Darling, Jr.Executive Secretary DATED:\u00a0 AUG 19 1986 BUCKLEY, Chairman, DissentingI dissent because, even if the unswornrepresentations of counsel in Respondent’s motion to withdraw from the settlementagreement are taken as true, they do not constitute a legal basis for setting aside thejudge’s order approving the settlement agreement.\u00a0 Respondent claims that it did notenter into the agreement freely and without coercion, but that conclusion cannotreasonably be inferred from the factual assertions made.\u00a0 A body that freely permits prose representation should not lightly conclude that failure to consult counselprevents an employer from entering into settlement \”freely and withoutcoercion.\”As the majority states, the Commission encourages theparties to disputes before us to reach agreements that voluntarily dispose of the disputedissues.\u00a0 In this case, Judge LaVecchia was assured that Respondent wished to settleas stated in the settlement agreement.\u00a0 In a letter submitted by Respondent with thesigned settlement agreement, Respondent’s president indicated that he wanted to withdrawthe notice of contest in order to terminate the costly litigation despite having a\”complete defense.\”\u00a0 Respondent signed the settlement agreement, whichplainly stated that the withdrawal \”has been made freely and without coercion\”;that the penalties proposed total $58,000; and that \”Respondent understands andagrees that, as a result of its withdrawal of its notice of contest, the citation andpenalties proposed therefore shall become a final order of the Commission.\”Nothing that Respondent has submitted to us sincesigning the settlement agreement indicates that there was any lack of understanding as tothe terms and effect of the settlement agreement.\u00a0 In fact, Respondent has simplyrepeated what was either told to or evident to the judge when the signed settlement wassubmitted to the judge before the judge approved it–that Respondent entered into thesettlement agreement while lacking counsel, during financial difficulties, and despitehaving a \”complete defense.\” Respondent’s motion does not state how any of theplain terms of the settlement were misunderstood and, although Respondent said that it wasnot aware of the ramifications of the settlement agreement since they were not explainedby counsel, Respondent has not stated what ramifications were not understood.\u00a0 TheSecretary’s affidavits represent that Respondent had been represented by counsel duringdiscussions of settlement at an informal conference.\u00a0 From the Secretary’s affidavitit also appears that the possibility of criminal charges even if the civil case wassettled was discussed at that time and again immediately prior to the final settlementagreement.\u00a0 In view of this, it appears that Respondent’s president was fully awareof the circumstances surrounding the settlement agreement and had an adequate opportunityto understand the plainly stated terms of it.To set aside the judge’s order in this case involvingnumerous charges of serious and willful violations and a large penalty when Respondent hasnot even alleged a sufficient basis for out doing so, will seriously undermine the policyto encourage settlement.\u00a0 We have little Commission precedent to guide the judge’sdecision on remand.\u00a0 The proper course of action, in my judgment, would be to permitboth parties to submit briefs and affidavits in support of their position to theCommission.\u00a0 Should they convince us that the allegations, if proven, wouldconstitute a sufficient basis for permitting an employer to withdraw from a settlementagreement, we can then remand the case for proof of the allegations.SECRETARY OF LABOR,Complainant, v.AERLEX CORPORATION,Respondent.OSHRC Docket No. 85-1257ORDER The settlement agreement submitted for approval by the parties is approved.Incorporated in the agreement is a motion by therespondent to withdraw its notice of contest to the citation which initiated theproceeding.Accordingly, the respondent’s motion to withdraw itsnotice of contest is granted, and the citation is affirmed in all respects.A civil penalty of $58,000 is assessed for theviolations affirmed.So ORDERED.Louis G. LaVecchia Judge, OSHRCDATE:\u00a0 June 13, 1986FOOTNOTES: [[1]] The attorney who had originally representedRespondent withdrew prior to the execution of the settlement because of a fee dispute withRespondent.[[2]] The dissent agrees that this case meritsfurther proceedings on both the factual and legal issues presented.\u00a0 The dissent,however, would require the Commission to rule on a legal issue–the circumstances underwhich an employer may withdraw from a settlement agreement–before the nature of, andfactual support for, Respondent’s objections has been determined.\u00a0 We think that thebetter procedure is for the judge initially to make the requisite factual findings. \u00a0The judge may decide that Respondent’s objections are unsupported and therefore avoidreaching the legal issue with which the dissent is concerned.\u00a0 Furthermore, shouldthe Secretary feel that any error of law has been committed on remand, he may petition theCommission for review on that issue.”