How a Lawyer Settles a Personal Injury Lawsuit

Your lawyer may take both formal and informal steps to settle your personal injury case, and the process can take a few weeks or a few years.

The vast majority of personal injury cases reach settlement before trial. There are many reasons for this, with advantages for both the injured person (the plaintiff) and the at-fault party (the defendant). Let's look at when and how a personal injury lawyer will likely negotiate a settlement on behalf of a client.

When Do Personal Injury Settlement Talks Start?

Settlement talks often begin before the personal injury lawsuit process even starts. But when those pre-litigation negotiations breakdown, a client and his or her personal injury lawyer may feel like they have no choice but to take legal action.

Only after each side of the personal injury case feels comfortable with the facts and the evidence will they seriously engage in settlement talks, and discussion on resolving the matter out of court will typically continue as the lawsuit proceeds.

Settlement talks can also intensify right before trial, or after a judge rules on a pre-trial motion, such as a motion for summary judgment or a motion "in limine". However, in most cases, serious settlement negotiations begin after each side completes its "discovery" (more on all of this later).

Who Negotiates a Settlement?

The plaintiff's lawyer and the defendant's lawyer typically lead settlement talks. But because an insurance company is often the entity that will write a check if the plaintiff wins or the case settles, the defendant’s insurance company often gets involved in negotiations.

Regardless of who actually engages in settlement talks, the final say in whether to accept or decline a settlement offer comes from the clients (plaintiff and defendant). When a lawyer takes your personal injury case, he or she is ethically obligated to present any settlement offer made by the defendant.

Personal Injury Lawsuit Settlement Strategies

One of the key factors in settling a case is timing. There are several moments during the life of a lawsuit where settlements become more common.

First, as mentioned above, there’s the completion of discovery. Discovery is the litigation stage in which the plaintiff and defendant have the opportunity to get crucial information from one another, and obtain potential evidence in preparation for trial. Types of discovery tools include interrogatories and depositions.

Second, settlements are common after the defendant’s motion for summary judgment. If the court grants the entire motion, the defendant wins and the case is over, unless the plaintiff files an appeal. If the court grants part of the motion, the plaintiff loses only part of his or her case. If the court denies the entire motion, a trial is usually the next step in the civil suit. A motion for summary judgment is often the defendant’s last chance to avoid a trial. So this is when a defendant may be most eager to settle should they lose on the motion for summary judgment.

Third, the case settles after the court rules on a legal tool known as a "motion in limine," in which the judge is asked to decide whether to include or exclude specific evidence at trial. An entire case might rest on the use of a particular piece of evidence. Perhaps it’s a videotape or an eyewitness’s testimony that proves the plaintiff’s case. However, there might be some questions as to whether the evidence is admissible at trial. If the judge allows the plaintiff to use the evidence, the defendant may be much more willing to settle.

Finally, sometimes cases actually settle right after the trial verdict comes down. That's because no matter who wins, the losing side can appeal, draining additional time and expense from the winning side.

If the plaintiff won, a defendant’s appeal could dramatically extend the time it takes for the plaintiff to receive his or her money. There’s also the chance of losing on appeal. This means a plaintiff may be happy to settle for a smaller amount than what the plaintiff won at trial to get paid more quickly and avoid a possible appeal reversal.

What Happens After the Case Settles?

After both sides agree to settle, they will confirm the terms and prepare a settlement agreement. The exact provisions included in the agreement will vary from case to case, but the defendant agrees to pay a certain amount of money in return for the plaintiff agreeing to end the lawsuit and give up the right to sue the defendant again for the same claims.

There may be additional provisions concerning nondisclosure of the settlement’s terms, release of liability, and how the defendant will pay the plaintiff. After each side signs the settlement agreement, the defendant or the defendant’s insurance company will write a check to the plaintiff’s attorney, and the case is complete.

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