Evaluating a Settlement Offer in A Personal Injury Accident Case

By September 21, 2010 January 13th, 2018 Personal Injury

Many personal injury accident cases are settled by a mutual agreement long before they make it to a court room. Typically, the plaintiff (injured person) will submit a settlement demand to the defendant for what she feels is a fair settlement amount. The defendant will then either agree to the amount, make a counter offer or reject the demand altogether. In most cases, the defendant will make the plaintiff a counter offer at which point the plaintiff must decide whether to accept the offer or not. While there is frequently a fair amount of negotiating back and forth between the plaintiff and defendant, the bottom line is that if the plaintiff does not ultimately accept the defendant’s offer to settle then the case will proceed to trial. As such, the plaintiff must carefully evaluate the defendant’s offer before deciding to accept or reject the offer.

Each personal injury accident case is unique and therefore each settlement offer is unique. There are, however, general considerations that every plaintiff should take into consideration when they are evaluating a settlement offer. Negligence is a crucial element in any personal injury accident case. In a few states, the theory of contributory negligence is still used. In a contributory negligence state, if the plaintiff contributed at all to the accident then she cannot recover any compensation for her injuries. Clearly this makes going to trial much more risky because of the jury finds that the plaintiff had any fault at all in the accident then they cannot award the plaintiff any money. Most states, such as California, use a comparative negligence approach to personal injury accidents. Under comparative negligence the parties can share the blame or negligence for the accident. If, however, a jury determines that the plaintiff was more at fault than the defendant then the plaintiff will receive nothing in the way of compensation. Therefore, if negligence is questionable the plaintiff should seriously weigh the risks of allowing a jury to decide who was more at fault if the defendant is willing to accept negligence by way of a settlement offer. Remember that anything that has been offered outside of the courtroom is generally not admissible at a trial meaning the jury will hear all the evidence without knowing that the defendant was willing to accept the blame before the trial.

The amount of the settlement is the other big consideration in evaluating a settlement offer. Most states allow compensation for two categories of juries. California, for example allows compensation for economic and non-economic damages. Economic damages are damages that are quantifiable such as medical bills, property damage and lost wages. Non-economic damages are what most people refer to as “pain and suffering”. The economic damages are generally easy to agree on. The subjective non-economic damages are where it gets tricky. If a plaintiff rejects a settlement offer and the case goes to trial, a jury will determine the amount of non-economic damages awarded to the plaintiff. The plaintiff could get a substantially larger award from a jury for non-economic damages, but she could also end up with substantially less. While a plaintiff’s attorney can advise her on what juries in her jurisdiction tend to award in damages, there is simply no guarantee. If the settlement offer is close to what the plaintiff feels she is entitled to in damages, she should think long and hard before deciding to roll the dice with a jury trial.

Aside from negligence and damages, a few practical considerations come into play when evaluating a settlement offer. A personal injury accident case that goes to trial can take months or even years to actually make it to trial. In the meantime, the plaintiff receives nothing for her injuries. Time, therefore, becomes a consideration. Additionally, The plaintiff should consider the defendant’s ability to pay. Many times, a settlement offer is based on the amount the defendant’s insurance is willing to pay. If the defendant does not have the ability to pay more than offered and will not realistically have the ability to pay more in the near future, then for all practical purposes a higher jury verdict may be worthless to the plaintiff. A plaintiff should always discuss with her attorney whether obtaining a larger verdict by going to trial will actually amount to more money or whether it will just be a larger amount on paper that she may never actually see.

For additional information or assistance, please contact the California personal injury law firm of Ledger & Associates at 1-800-300-0001 or visit the firm’s website at www.ledgerlaw.com.