The words “law” or “lawyer” are almost always associated with a lawsuit or trial. Consequently, images of courtrooms filled with people, a jury box, and a trial lawyer addressing a jury almost always come to mind. Nonetheless, the truth is that most lawsuits do not end up at trial, but are resolved by settlement agreements. It is estimated that approximately 97% of cases settle before trial. For this reason, it is essential that one who is negotiating a settlement agreement make sure that he/she is fully protected under the settlement agreement and that are no loopholes placed by the other side to allow for a breach of the settlement agreement.
Below is a list of recommendations that should be considered when negotiating or drafting a settlement agreement:
- Make sure that all parties who should be a part of the settlement agreement are in fact a part of the settlement agreement. The settlement should include all parties involved in the matter.
- Confirm whether either or both sides claim responsibility for the event that led to the initial conflict or lawsuit. If neither claims responsibility, and both parties are comfortable with that, insert a paragraph into the settlement agreement that states the same.
- Make sure that the settlement agreement addresses all pending claims that each party has against one another. Oftentimes, settlement agreements provide for a waiver of all potential claims against the other party; as such, it is imperative that all claims be resolved by way of that settlement agreement that is being negotiated.
- Make sure that the settlement agreement contains easy-to-understand default provisions. In other words, make sure that the settlement agreement explicitly states what happens if one, or both parties, do not comply with the terms of the settlement agreement.
- Make sure that there is a provision in the settlement agreement that provides how and where a breach of the lease can be resolved (or litigated), and who will be responsible for paying the attorneys’ fees if litigation is probable.
- Make sure that all parties to the settlement sign and date the settlement agreement.
- If a litigation is pending, make sure that a Notice of Settlement is filed with the Court to inform the Court of the parties’ decision to settle.
- Make sure that provisions are included in the settlement agreement that protect (or attempt to protect) if one of the parties files for bankruptcy after entering into the settlement agreement.
- If you are not represented by an attorney, make sure that you retain an attorney to review the terms of the proposed settlement and agreement thereon.
*The above list is not an exhaustive list and is intended solely to serve as a brief summary of the factors that should be considered.
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If you need legal assistance negotiating a settlement of your case, contact Katz Law now! We are Los Angeles attorneys who have dealt with a significant amount of settlement agreements.
Call us at (844) KATZ-LAW for a FREE consultation!