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Understanding the Components of a Personal Injury Settlement

For a variety of reasons, few personal injury cases ever go to trial in front of a judge and jury. Instead, the parties in the dispute resolve their differences by negotiation. When the litigants settle their dispute, they avoid the big investment of time and financial resources that is required for a full trial. The time element is often crucial: injured plaintiffs need compensation from defendants to pay bills, and defendants often want to end the dispute to avoid piling up legal fees.

Settlement negotiations usually take place after lawsuits are filed

Settlement agreements arise from litigation, which means that the injured plaintiff typically has already filed a civil lawsuit against the defendant. By filing a lawsuit the plaintiff ensures that if the defendant refuses to come to terms, the option of going to trial always exists. Sometimes a lawsuit needs to be filed to ensure that the relevant statute of limitations doesn’t expire while negotiations are ongoing. Other times a lawsuit is necessary just to bring the defendant to the negotiating table.

One consequence of having litigation underway is that the court plays an important role as a kind of referee during the process. Courts strongly encourage cases to settle because it saves court resources for other, potentially more serious cases. But until a case settles the procedures of the court must be followed. Parties can still ask the court to require the other side to do certain things, such as disclose evidence.

The settlement agreement needs to protect the plaintiff’s interests

Negotiating a fair settlement is as much an art as a science. Settlements need to take into account many different components, including:

  • The facts of the events that caused the injury.
  • The expenses the plaintiff is facing as a consequence of the injury.
  • The defendant’s resources (insurance, cash and other liquid assets, anticipated income, and so on).

In a full trial issues like these get evaluated by the fact finder (the judge and/or jury). A settlement takes place without the benefit of this unbiased examination of facts. The parties need to come to grips with disagreements on their own. The calculation of damages is a good example of a subject that can involve difficult negotiation. Should the defendant agree to compensate the plaintiff for more than easily calculated costs, like prior medical bills? Or should the defendant also be put on the hook for less easily quantified amounts, like the plaintiff’s pain, anticipated future costs, and so forth?

The settlement agreement itself is a binding contract, which the court must approve before terminating the litigation. The agreement itself typically provides for a range of things, including:

  • The total amount of compensation the defendant agrees to pay, often itemized.
  • A payment schedule (especially common if the defendant will pay from his or her personal resources).
  • A release of the defendant from liabilities that aren’t otherwise covered.

Negotiating settlements is at the heart of the work personal injury attorneys do. Having experienced representation is essential to getting the most from a negotiation. The attorneys at Greenman Goldberg Raby Martinez have represented injured clients in the Las Vegas area for over 45 years. For a free attorney consultation about your case call us today at 702-388-4476 or send us a request on our contact page.