The Settlement Phase Explained

The Settlement Phase Explained

Many cases settle voluntarily, without having to go to trial. Trials take time, are expensive and may make clients nervous. They can also produce unexpected outcomes. From a personal perspective, an experienced personal injury lawyer may want to take a case to trial — but that is always the client’s decision. The job of an experienced personal injury lawyer is to help clients achieve their goals. At John Bales Attorneys, we find that most of the time, the client wants the matter resolved quickly and fairly, so settlement is always in mind. If no settlement offer meets the client’s goals, the matter can be resolved by trial.

Experienced personal injury lawyers also understand that settlement should not be rushed. Settling a case is a process. It is a dialogue and can be complex. Different lawyers initiate the process in different ways (who goes first and so forth), but it always ends up with an offer and a series of counteroffers and counter-demands. This is the process, and there is more to it than simply passing numbers back and forth. Behind the numbers is reasoning. It is through this dialogue that the case is, hopefully, resolved. Each side has an opportunity to persuade the other. By exploring the weaknesses and strengths of each side’s case, the parties will generally be able to either agree on settlement or agree that they need the help of either a judge or a jury. Either way, they make forward progress — and reasonable decisions.

Be wary of settlement offers that come very early in this process, even if it is tempting to end the case quickly. After many years of practice, we have found that insurance companies will often offer a settlement before clients and their lawyers can determine all of their damages. Or a settlement offer will be extended quickly by an insurance company, before all the liens and other expenses have been determined. Everyone wants the matter resolved as quickly as possible — but an experienced personal injury lawyer knows that a fast settlement offer by an insurance company can be a trap.

Deciding whether to accept a settlement offer requires you to consider subjective as well as objective factors. For example, there are benefits to ending your claim, and it may also be a personal relief. On the other hand, the time, anxiety, energy and risk assumption required to go to trial may be worth it for the client —because of the potential for greater compensation, for an important lesson to be learned or for an important message to be sent. The decision does not always turn on the money alone. Client objectives vary, and each case and each client is different. The settlement process offers an opportunity for dialogue — and out of this dialogue comes a decision that fits the client in that case.

There are numerous factors to think about when considering a settlement offer, but issues to consider start with the amount of money being offered, the conditions attached to the offer and the amounts owed to third parties — like health care providers or other insurance companies. There are laws and contractual obligations that govern these third parties’ rights to participate in the distribution of settlement proceeds. These rules are part of every settlement agreement, and you are expected to know them. An insurance company has no duty to explain the rules to you. Third parties such as health care providers might also claim part of your settlement behind the scenes.

What you and your law firm must determine is the true value of the offer being extended. That is, you need to know how much of the money offered will end up in your pocket. To answer this question, the lawyer has to solve the puzzle (so to speak) that is the totality of the client’s claim, with the goal of maximizing the claim’s value. An experienced personal injury lawyer will analyze these and other issues behind the scenes, so the client can focus on the challenge of recovering from injuries and putting his or her life back together.

The lawyer participates in settling cases — but it is always the client who makes the final decision. The lawyer’s job is to prepare the client to make that decision fully informed. And, of course, the lawyer will provide the benefit of his or her education and experience, as well as perspective that can be valuable for clients who may be upset and angry about their injuries. Emotions play a part in decisions on settlements, of course, but they should not be the only criteria. Your lawyer will help you strike a proper balance as you go through the process.

Sometimes the courtroom is the right choice, if the client makes that decision with the advice of an experienced personal injury lawyer. Understand, however, that your lawyer will work to give you a realistic assessment of the benefits and risks associated with settlement and trial. That way, you can make an informed choice.