A settlement ends the lawsuit, and nearly all cases are settled before trial. Settlement discussions are typically ongoing during the entire case, but as a trial date nears, one party (typically the defendant) makes a settlement offer to the plaintiff.

TIP: Almost all courts require settlement discussions by ordering the parties to attend at least one court-ordered mediation.

Settlements are written agreements between the parties. The settlement agreement is generally not filed with the court, and its provisions are confidential. Some of the points covered in a settlement agreement include:

  • the exact amount of money to be paid
  • the identity of the party paying the money
  • the identity of the party who receives the money
  • the form of payment
  • the due date of payment (settlement checks are sent to the attorney)
  • a provision regarding how the attorney's fees will be paid (one party pays the other party's fee, each party is responsible for their own attorney's fees)
  • who is paying court costs
  • an agreement to dismiss the lawsuit with prejudice-that is, forever waiving the right to file another lawsuit based on the same facts

I think a have a good case. How do I decide whether to accept a settlement?

Settling your case is a big decision. Here are some things to think about:

  • Your chances of winning at trial. If there are problems with your evidence, settling the case may be the best option.
  • The defendant's "deep pockets." It is common for insurance companies to handle the defense of their policyholders. The company typically has a large amount of money at its disposal to settle your claim and wants to avoid a trial at all costs. If this is your situation, push the case as close to trial as you can, then take the settlement if it is reasonable.
  • The emotional and physical impact of a trial. Foregoing a trial and accepting a settlement check will relieve you and your family of a lot of stress.
  • Your attorney's fees arrangement. If you are paying your attorney, her fees will climb astronomically during the trial. You should consider settling if the money will cover your attorney's fees to date yet still leave you with something. You do not want to lose at trial and owe your attorney thousands of dollars when the case could have been settled.

If we start the trial, is all chance of settlement gone?

No. Cases are regularly settled during the trial. Up until a verdict is rendered, the parties can agree to settle and dismiss the case.

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