Out of court settlement of a personal injury claim
Every case is different, so there can’t be any hard and fast rules on settlement negotiation. However, here are some pointers, based on our experience of handling injury claims over many years.
Assuming a solicitor has already taken on your case, has gathered all the relevant information and has sent a letter of claim to the defendant…
So now what happens…?
The defendant has a period of time – around three months – to review their legal position, under the Pre-Action Protocol for Personal Injury Claims. Their solicitor will usually liaise directly with the defendant during this period.
When they have completed their investigation a Letter of Response is served and this is often followed by the first steps towards a negotiated settlement.
A lot of time and money can be saved by negotiating a settlement out of court. Most claims settle this way and the courts expect the parties to try to reach an agreement. A judge will take into account the fact that one of the parties unreasonably refused to negotiate, and this is likely to be reflected when assessing who pays the final legal costs.
Litigation should only be considered as a last resort to resolve a legal dispute.
Let negotiations begin
It’s conceivable you might want to settle a claim on your own if the value is relatively low – but if you’re talking substantial figures (over £1,000) then you’ll want to let a solicitor deal with the case.
Solicitors are the professionals and consequently in a better position to understand the law and act on your behalf. We are experienced in conducting negotiations to produce the best result possible for our clients and maximise any compensation due.
A solicitor cannot enter into a settlement of your case until you, the client, have agreed the terms of that settlement.Negotiations are generally initiated with a telephone call or letter. This will often be on a ‘without prejudice’ basis.
It’s important to establish a clear set of objectives with your solicitor before opening up negotiations – particularly in relation to the value of the claim. What’s your ideal, best-case outcome? And what is the lowest figure would you be prepared to accept if you had to? A barrister on a case we were recently involved in called these the client’s ‘Champagne outcome’ and ‘Brown Ale’ outcome!
Liability and Contributory Negligence
Negotiations will often see the issues of liability raised, including Contributory Negligence. The riskier the case from the claimant’s point of view, the more flexible they need to be in negotiations.
Where contributory negligence is alleged the defendant will generally express it in percentage terms, alleging that the claimant is, for instance, 33% at fault for the accident. A classic example is where someone in a car accident has failed to wear a seat belt. The percentage figure is often hotly contested as it determines how much any compensation award should be reduced by.
Offers to Settle – Part 36
Settlement offers are often said to be made under Part 36; they are known as ‘Part 36 Offers’. “Part 36” is a section of the Civil Procedure Rules for cases conducted in England and Wales that governs offers to settle. Either party can make a Part 36 offer.
If the defendant makes an offer but the claimant doesn’t accept, the claimant will have to pay a portion of the costs if the compensation turns out to be less than the defendant was offered, and vice versa.
As a result, a Part 36 offers can be an extremely useful weapon in the personal injury lawyer’s armoury and any party receiving a Part 36 offer should give the offer serious thought.
Settling Out of Court: Common Questions Answered
When it comes to settling a personal injury claim, there are a few common questions which understandably worry claimants. Here are some of the most frequently asked questions, along with our expert advice.
Does a settlement mean the other side admits I’m right?
Sometimes the other party settling the claim will admit you’re in the right – but in many cases there’s no formal admission of liability or responsibility for the accident and no apology; just a payment of compensation.
When can settlement occur?
Settling a claim can happen at any time, from the moment the claim is made all the way through to the steps of the actual court room itself. Most are settled before court proceedings are issued. Some settle while a trial is in progress!
What are the advantages of settling?
The biggest advantage of settling the claim as early as possible is that you’ll be paid the compensation sooner and without the risks associated with a trial. Going through the labyrinthine twists and turns of the legal system and taking the case to court can be very protracted, and it is difficult to predict precisely how long it will take.
Avoid a trial (and therefore the risk of losing the trial) should not be underestimated, even in the strongest of cases. Judges are fallible: They make unpredictable decisions. There is rarely such a thing as a 100% guaranteed case – particularly where a Part 36 offer may have been made.
Court hearings are also stressful and adversarial. While many people think they might want their day in court, the reality is usually different.
Am I admitting my case isn’t strong if I am willing to negotiate?
Not at all. All you’re saying is that you know your case is strong enough to win but you’re prepared to entertain a cost effective solution to avoid the expense of going to trial. It’s a practical move, not a cowardly one or sign of weakness.
Will the trial judge know about the offers made?
Most offers are dealt with in such a way that prevents the judge from seeing them until a decision has been made on the case. When a decision has been made, any ‘without prejudice’ offers will be made known and this could influence a judge’s decision about who should pay the costs of the trial.
What about my legal costs?
The solicitor dealing with your case will generally only recommend an offers that deals satisfactorily with the payment of your legal costs. The usual costs arrangement is that the defendant will pay the claimant’s ‘reasonable’ legal costs. Costs are generally agreed, but if agreement cannot be reached then they will be ‘assessed’ by the court.
What if the other side doesn’t pay what they agreed?
It is very unusual for a party not to pay what was agreed where an insurance company is involved, which is generally the case in injury claims. However if they do not do so then you can go to court to enforce the agreement.
Our solicitors are here to guide you every step of the way through your personal injury claim.