In legal practice, a settlement is one way of settling a dispute. It can be done before or during a civil trial. The settlement is a legally binding agreement that puts forth the rights and obligations of the parties. It is a contract that is enforceable and usually involves the payment of funds from one party to another. The settlement is based on the receiving party’s promise that no further legal action will be taken against the paying party. Since the settlement is enforceable, if one party breaches the contract, a lawsuit can be placed against them.
There are benefits and pitfalls associated with an agreement. It is important to retain an experienced personal injury lawyer to make sure the settlement is structured correctly and protected. Let’s look at settlements, when they are a good idea and when they are not and what a personal injury lawyer can do for you.
How Many Cases Settle?
The vast majority of cases settle. Most individuals involved in a lawsuit prefer to settle since it eliminates the need for a trial and the cost associated with it. Some expenses that can mount up during a trial are legal fees, the cost of expert witnesses, time the plaintiff and defendants must put into a trial, and the anxiety and stress that go with it. In the United States, less than 5 percent of cases go to court and 95 percent settle.
If there are multiple parties associated with the case, a settlement may not be reached with all of them. Take, for instance, a situation where two vehicles are responsible for the injuries the plaintiff suffered. The insurer of one vehicle may agree to settle while the other insurance company will not. That means the plaintiff or injured party can reach a settlement with company A but may need to take company B to court.
Why Do Some Settlements Proceed?
In some cases, the settlement is offered early in the case. This is often because the insurer realizes that the defendant is responsible for the damages the plaintiff suffered. When the injury is such that medical bills and lost wages and other expenses may be high, it is in the defendant’s interests to offer a settlement quickly. The insurer knows that the plaintiff may be frightened and not have enough money to support their family during the period, and it offers a low settlement that might be seen initially as advantageous to the plaintiff.
This is not always true since at the start there is no way of knowing how much it will take to cover the accident expenses. Alternatively, the plaintiff’s lawyer may tell their client to resist this early offer since, once accepted, continuing or future expenses will not be covered.
Example of a Case That Settles Early
Some cases may settle earlier than others. Let’s say that an individual who was not negligent for a collision suffered traumatic brain injury. The negligent party’s insurance company recognized that their client was at fault. The cost for treatment in this case would be high, exceeding $100,000. However, the defendant in the case only carries $30,000 worth of insurance. Their insurer will most likely offer the plaintiff the full amount within a short period after the accident. That amount will not cover the cost of treatment.
Cases That Do Not Settle
In some cases, the insurer or the defendant is not anxious to settle. This occurs most often when the defendant feels they are not responsible for the injuries the plaintiff suffered. An alternative reason would be that the defendant does not believe that the plaintiff has enough evidence to prove that they should pay the damages. Under these circumstances, it is unlikely the defendant will make an offer or respond positively to the plaintiff’s demands in the case.
Courts May Ask for a Settlement Conference
The courts often encourage the participants to consider settling. They may ask that a structured settlement conference be offered to both sides, so they can meet and see if a settlement is possible. As opposed to a trial, the mechanics and details of a settlement may be confidential. This is important since a trial allows damaging evidence to be made public for both sides in the dispute.
A request to maintain confidentiality may be made during the discovery process, where both sides get to know what information each has in the case. The party that wants to maintain confidentiality must show that disclosure of the information would harm the case or lend a prejudicial impact. In California, it is the party who is asking that the information be disclosed to prove why it is needed. One downside for the plaintiff or defendant is that by evoking critical confidentiality, evidence may be hidden.
What Happens If I Need Care After Accepting a Settlement?
After a settlement is accepted and the plaintiff is paid by the defendant or insurance company, no further payments in the case will be rendered. This means even if additional surgery related to the accident injury is needed, it will not be paid for. That is why attorneys often encourage their clients to wait until they are cleared or told that no further treatment will help before accepting a settlement.
How Long Does It Take to Receive Payment After Settlement Is Approved?
It usually takes one or two weeks to receive a settlement check. If the payment is not received after two weeks, the plaintiff’s lawyer must contact the payer and demand payment. Remember that after both parties agree, a settlement contract is issued to the court that explains the settlement details with all nuances included. Once the court has the contract agreed to by both parties, it will formally approve it. If the court is bogged down with cases, this may extend the time it takes to receive a settlement check.