civil litigation: process and procedures chapter eight settlement and alternative dispute resolution

Civil Litigation:Process and Procedures

Chapter EightSettlement and Alternative Dispute

Resolution

Civil Litigation: Process and Procedures Goldman/Hughes

© 2009 Pearson Education, Upper Saddle River, NJ 07458.

All Rights Reserved.2

Negotiated Settlement Most cases settle prior to trial

Case is analyzed & prepared Realistic determination of value/cost

is made Documentation of claim is submitted

Informal negotiations Negotiations assisted by Alternative

Dispute Resolution (ADR)




Settlements, cont. Direct costs assessed

Time preparing for & attending trial Preparation of witnesses & exhibits Court costs

Indirect costs Time it takes to get to trial Anxiety of uncertainty Strain of reliving the event




Settlement Factors Plaintiff

Uncertainty of juries Potential for surprise Judicial decisions affecting admission

of evidence Direct & indirect costs Limited defendant assets Carrying debt for long periods of time




Settlement Factors, cont. Defendants

Judges expect good faith offers Cost/benefit analysis determines it is better

to pay before incurring costs of litigation The reserve allotted for this action is more

than the demand Unusually appealing plaintiff, witnesses Unusually unsympathetic defendant,

witnesses




Negotiations Many styles, approaches

Intimidation Confidence & reasonable position Well prepared to show:

Strength of facts (witnesses, evidence) Strength of law

Eliminates the “wild card” factor of a third-party decision-maker




Damages Plaintiff determines the preliminary value of

the case Special damages, both paid & outstanding, e.g.,

Lost wages Medical bills (future treatment, rehab) Repair bills Cost of performing chores

General Damages, e.g., pain & suffering Speculative, difficult to assess Research into local awards can help prepare a

claim




Damage Defenses Causation

Injury not as bad as claimed Preexisting condition

Liability Defendant not responsible

No contract or no breach No duty or breach of duty




Negotiation Documents Settlement letters

Informal demand Sets forth special damages

Settlement brochure Outline of the case, facts Damages (special & general) Demand Exhibits supporting claim




Supporting Evidence Photographs

Before & after, during treatment Even if too prejudicial for trial Marked as exhibits & captioned

Bills & reports, other records Medical bills, reports Repair bills Employment documentation




A Day in the Life Multi-media, electronic, or print “Before” movies, still photos, videos Follow through an “After” day Documents changes in activities

Chores Work Transportation Recreational activities




Work Product Negotiations are not limited by the

rules of evidence Must make a persuasive case to

succeed Without giving away trial strategy Without violating the attorney work

product doctrine




Settlement Range Plaintiff’s (π’s) demand, usually far

above the expected recovery Defendant’s (Δ’s) offer, usually far

below the expected recovery If close at the outset, settlement

will be easier Terms are on the table, motives are

not




UPL Paralegals cannot

Make offers or demands Agree on behalf of a client Advise clients on the fairness of an offer

Paralegals can Act as a conduit of information from the

attorney to the client Safeguard confidential materials




Offers Once the range is established,

negotiations may proceed All offers should be communicated

to the client, even those outside the range

The dispute may be over specific performance, which leaves less room for maneuvering




Minors’ Settlements Generally, the court must approve a

settlement made on behalf of a minor or person under a mental disability File a petition with details of liability &

damages Identify legal fees & costs May be some oversight of investments,

payouts




Settlement Documents Release of claims by the plaintiff or

Mutual release of claims by both parties In writing, normally prepared by the Δ Identifies the parties, situation, and where the

matter is in terms of litigation Identifies the settlement terms & payout Withdraws or dismisses the case Confidentiality clause Signature lines




Release




Confidentiality of Settlements Agreement may contain a

confidentiality clause May condition the settlement on

confidentiality Without penalty, there is no

enforceability Private contract, and not public

record




Termination of Lawsuits Once the lawsuit is filed, the

settlement must include an end to the case, and the court must be notified Notice of dismissal (no answer filed) by π,

with no record Stipulation of dismissal (signed by all

parties) with no record Consent judgment (settlement becomes

part of the court record)




Alternative Dispute Resolution ADR includes

Negotiated settlements Arbitration Mediation Neutral fact finding Early neutral evaluation Mini-trials Summary jury trial Private judging




ADR Characteristics Generally less costly Generally faster Can remain private, rather than

public Covered by confidentiality Relaxed rules of procedure,

discovery, evidence Limited right of appeal




Binding Decision or Promoting Settlement Some types of ADR end with a

binding decision that the parties have agreed to abide by (voluntary arbitration, private judging)

Some types inform the parties of the value of their case, encouraging settlement (mediation, Early Neutral Evaluation, Summary Jury Trial)




General Characteristics ADR participants can generally

Resolve disputes in a confidential setting

Follow their own procedural rules and timeline

Select the presiding official or “neutral” Lower costs of the dispute Maintain on-going relationships (non-

adversarial, in many cases)




Negative Indicators Sympathetic clients or witnesses

argue for a jury Witness credibility question Public resolution (precedent) may

discourage subsequent suits Wish to preserve the right to appeal No viable possibility of settlement




Mediation Non-binding, structured negotiations Led by a mediator, or facilitator, who will

“broker” the procedure Generally voluntary, although can be –

court-ordered Mediator levels the playing field between

stronger & weaker parties The mediator does not render a decision,

but helps the parties arrive at a mutual agreement




Voluntary Arbitration Binding (voluntary) Parties agree to rules of discovery,

procedure & evidence Arbitrator(s) render a decision

(award) that can be converted into a judgment

Limited grounds for appeal




Court-Annexed Arbitration Usually during or following

discovery in a case set for trial Arbitrator(s) render an advisory

judgment, which the parties can accept or reject

Helps the parties evaluate their cases & promotes settlement




Other ADR Methods Binding or non-binding Neutral Fact Finding may

settle a single issue Early Neutral Evaluation assists parties in settling

by evaluating a written description of the matter Mini-trials are non-binding proceedings conducted

in front of the decision-makers in the matter Summary jury trial is non-binding, conducted in

front of a mock jury Private judging may be permitted in some states,

with a temporary judge hired by the parties to render a binding decision, appealable (with a record)




Private ADR Private organizations can help

parties arrange for a variety of ADR methods

They can provide (for a fee) Rules Facilities Lists of decision-makers or neutrals Forms & templates for the process




Federal Arbitration Act Voluntary arbitration agreements

in commercial contracts are Valid Irrevocable Enforceable

civil litigation: process and procedures chapter eight settlement and alternative dispute resolution

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