Settling a civil lawsuit.
By: Ryan C. Young, Esq.
Recently, I was working on a case in which a pro se litigant (someone without an attorney) was suing my client. I kept trying to send communications to the opposing party that my client would be interested in discussing the possibility of settlement. Rightly or wrongly, many individuals have a poor understanding of how settlement can work in civil litigation. Further complicating this is the fact that some attorneys are just plain bad at the process of settlement as well.
One of the biggest hurdles I faced in the case I described above is the fact that the opposing party wrongly perceived that I was trying to trick them by offering to enter into settlement communications. In particular, they were concerned that I was trying to coerce information out of them which could later be used at trial.
Virginia case law is clear that an offer to settle or compromise is not an admission of guilt or malfeasance. The reasoning of this rule is that it is in everyone’s best interest if parties settle their civil matters (disputes over money) outside of the courtroom. Plainly speaking, the Virginia Supreme Court has made it clear that they would like to encourage parties to settle their disputes over money out-of-court. For this rule to apply, there must be a “claim” which is “disputed as to either validity or amount.” Dart Drug Corp. v. Nicholakos, 221 Va. 989. In other words, the timing of the settlement communication is important.
There is one caveat to the above rule. Offers to settle or compromise are inadmissible. However, admissions of guilt or liabililty, which are contained in settlement communications are admissible in a future trial. So, your settlement communication should clearly state that you are not admitting any fault or liability. It is also important that the communication clearly state that the correspondence is intended as a settlement communication.
Another important point to remember is that you should always take the high road when trying to discuss settlement with the opposing party. Attorneys themselves can often violate this point. Remember, what you are trying to accomplish is to get the best financial outcome for yourself. It is ok to be firm in your position and your interpretation of the validity of your case. However, making snide comments or unreasonable demands will only make settlement that much more difficult. Sure, you may be able to get the “last word” in, however, it may cost you the opportunity to come out ahead financially.
One other difficulty I often run into with my own clients is their impression that an offer of settlement to the opposing party would somehow show that they are weak or do not believe in their case. I cannot lie, there may be a slight bit of truth to this.However, settlement can sometimes lead to a much better outcome than if the parties proceed to trial. Trial in any court can be very expensive and is often risky. Remember, just because you get a judgment, that does not mean you automatically receive the cash right way.
In the above described case (which is rather common), my client decided to explore settlement after weighing the possible costs of trial. It wasn’t that we didn’t believe in the case. If the case proceeded to trial, I would have represented my client vigorously. However, I had to be honest with my client about the potential costs involved with litigation.
In closing, I truly believe it is always worth the effort to at least explore the possibility of settlement. If the parties cannot come to an agreement, then trial may be necessary. Of course, every case presents different facts and you should discuss your peers with an attorney. However, it is important to remember that people rarely get exactly what they want in civil litigation.
Law Office of Ryan C. Young, PLLC | Richmond, Virginia | Civil Litigation