Accepting a Pre-Suit Settlement Offer

Sometimes, parties will agree to settle claims before a lawsuit is even filed. Some people think that it is best to offer money to resolve issues before litigation in order to keep matters private and forgo the cost and time of litigating matters. However, individuals need to keep certain things in mind when deciding if accepting a pre-suit settlement offer is right in their situation.

Strength of Their Case

One of the most important factors to consider when deciding if accepting a pre-suit settlement offer is appropriate is the strength of your case.  If you have a strong case that can be easily proved in court, it might make sense to file a lawsuit.  In such instances, it is likely that individuals will increase the amount of money offered to resolve a claim during litigation, so there is little incentive to settle the claim early.

However, if there are issues in establishing liability in a lawsuit, accepting a pre-suit settlement offer may make more sense.  This is because it is far from certain that a party will recover anything in litigation, so it might be best to accept any money now before their claims are put to the test.  Moreover, if the other party in litigation has a strong defense to claims made, this could also be a situation in which a pre-suit settlement offer should be seriously considered. An experienced litigator should be able to discuss the strength of all claims and defenses in order to advise clients whether a pr-suit settlement makes sense.

Strength of Defenses

Another important consideration when deciding if accepting a pre-suit settlement is right for you is any defenses that the other party to a case might have.  Sometimes, litigants have defenses that are easy to see even before a lawsuit has been filed. For instance, litigants may be able to produce a release that has been signed making it virtually impossible to file a given lawsuit. In addition, a party might be facing financial insolvency and the threat of bankruptcy and the associated difficulty in pursing money could impact settlement determinations.  Sometimes, even if a party has a strong case on the merits to prove liability and has suffered damages, they still may not be able to win because of defenses.  In such situations, accepting a pre-suit settlement offer may be a wise move.

Need for Money

The need to obtain money in the short term is another factor that should be evaluated when deciding if accepting a pre-suit settlement offer is advisable. Some individuals need cash to pay for all types of expenses. This could relate to the claim for which a settlement is offered, such as the need to pay for medical bills and vehicle repairs after a car accident.  Other times, people need to pay for living expenses such as rent or food, and receiving a settlement can be a windfall that can help build financial security.

From a legal standpoint, it is rarely advisable to accept a settlement offer simply because you need cash to pay for expenses. Settlement offers can increase dramatically over time and waiting even a year to settle the case can have a substantial impact on the amount of money that is offered to settle a matter. It is important that clients keep their attorneys apprised of financial pressure so that lawyers can keep this consideration in mind when evaluating a case.

Making a Statement

Some people wish to pursue litigation in order to memorialize grievances that they have against another. Indeed, litigation is often a public process, and lawsuits can be an outlet so that parties can convey their story.  Moreover, statements made in litigation papers are generally exempt from defamation claims so that parties can be candid about the allegations they have about other parties. Settlements often include confidentiality agreements that require parties to keep information about the claims secret. Indeed, one of the benefits of settling claims early for many parties is that they can keep allegations quiet and away from the public litigation process.  Many people do not care much about confidentiality and are happy to keep information secret in favor of settling a claim before a lawsuit is filed.  However, some people may wish to memorialize their allegations and make a statement in ways that may be impossible if they accepted a pre-suit settlement offer before filing litigation.

Other Settlement Terms

Another consideration before accepting a pre-suit settlement offer is other terms that may be associated with the settlement. Sometimes, parties wish for others to sign non-disclosure agreements, non-solicitation agreements and other writings to resolve a dispute between the parties. Moreover, parties also usually need to sign releases that might be relatively expansive.  The terms of a settlement are important when evaluating accepting a pre-suit settlement offer, and an experienced attorney should be able to provide feedback about the types of settlement terms that are reasonable.

The Rothman Law Firm is experienced in settling claim before litigation, both on behalf of parties seeking a settlement and others paying a settlement to others. If you are looking for an experienced New York and New Jersey attorney to handle your pre-suit settlement negotiation or other legal issue, please feel free to contact The Rothman Law Firm to request a free consultation.