Settlement definition law is used in civil suits where an agreement is issued to prevent the civil litigation from proceeding through the court system. This agreement is referred to as a settlement. When a settlement in civil litigation occurs, the defendant is agreeing to some of the claims made by the plaintiff and is deciding not to go through the process of litigation in court.

In the event a settlement does occur, the defendant will often be required to provide the plaintiff with monetary compensation as a result of the acceptance of the legal responsibility for their actions that caused the plaintiff to incur a loss.

Why Do Settlements Occur?

Settlements are often popular options in many civil litigation cases for multiple reasons. Some of the reasons plaintiffs and defendants choose settlements are:

  • The high cost of prolonged litigation such as lawyer fees, expert testimony, etc.
  • The length of time civil litigation can take.
  • Litigation can negatively affect the reputation of either or both parties. This can be especially true in claims of sexual harassment.
  • The process of discovery, which allows parties to gain information from each other can be embarrassing or infringe on privacy that parties may wish not to disclose.
  • The need for monetary compensation to be made sooner such as for medical treatment.
  • The defendant may wish to settle for a certain amount instead of leaving the chance for the court to determine it.

Often times settlements will occur even before a lawsuit has been filed, to reduce the amount of money spent on fees and services to rectify the problem. If not made before the case is filed, they often occur in the early stages of the case. More complex litigation suits such as class action suits that involve multiple defendants will require the approval of the court before the settlement will be allowed to proceed.

What is the Civil Litigation Settlement Process?

A civil lawsuit often occurs because a claimant feels they have suffered damage from the defendant. The plaintiff's ultimate goal is to seek damages for the injury that can help make them whole again. Once a civil lawsuit claim has been made by a plaintiff:

  • The attorney or legal team for the defendant will evaluate the facts laid out in the plaintiff's claim.
  • If the attorney feels that the case of the plaintiff is strong and it is likely that their client will lose, the attorney may recommend for their client to seek a settlement.
  • If the defendant does not wish to settle, the case will proceed to court.

Due to the fact that trials can be an extremely costly process for both the plaintiff and the defendant, many parties will look for alternatives to going to trial. This can include such things as mediation and arbitration, though both can be costly and lengthy procedures as well.

If the parties decide to pursue a settlement option, the attorneys for the plaintiff and defendant will work as intermediaries during the settlement process. During this process, it is up to both parties to decide to offer, accept, to decline the proposed settlement.

Even though settlements can take less time, they are still part of a process, and there will be many opportunities before and during a civil litigation case for a settlement to occur. If a settlement is reached, the litigation is completed and the plaintiff will typically agree to seek no further damages from the defendant in the future as part of the agreement. Sometimes the agreement can also include policy changes on the side of the defendant to prevent future issues from occurring.

Settlement agreements are not often publicly disclosed except for the fact that the case has reached a settlement. This can be especially true and beneficial in high-profile cases where parties are seeking to protect their reputations by avoiding litigation. Though disclosure is not common, most defendants in high-profile civil litigation cases will make a statement saying that even though they have reached a settlement their company had not done anything wrong.

In larger cases, such as class action suits, terms of the settlement can be much more complex and will require a review of the court to make sure the settlement that was reached is considered fair. These cases can also be difficult due to the fact that some plaintiffs may want to settle where others may wish to proceed to court.

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