When Personal Injury Settlement Doesn’t Work
You’re tried, but your attempt to settle your injury claim doesn’t work. What to do now? Here is a look at your options if the A look at your options to advance towards a settlement of your personal injury claim.
Remember, settlement won’t always be possible in every case. There are some cases which have very little chance of settling for a verity of reasons. Some of the more common reasons are below:
- The Defendant doesn’t want to settle.
- The Defendant is attempting to settle, but the offers are totally unreasonable
- The Plaintiff wants their day in court.
- There is a claim for punitive damages
Settlement is a voluntary process. If one of more parties don’t’ want to settle, there is little that can be done to avoid a trial. It’s important to consider whether the barrier to settlement is based in principle, or whether it is due to a gap in understanding. It is possible that one (or both) parties has incorrectly appraised the value of the settlement. It could be that the plaintiff wants too much for the claim and the defendant believes the claim is worth much less. Both parties are outside the range of what could be considered reasonable for a settlement.
Where punitive damages are claimed, the chance at settlement may be low because the Defendant is likely to object to paying ‘extra’.
How to Reactivate Settlement Talks
You can’t settle if you aren’t talking with the other party. If the parties are at a standstill and neither one wants to make an offer – bite the bullet and make the first move. When a non-represented party is dealing with an insurance company you can generally get an offer from the insurer. The insurer is keen to settle a claim if possible and the adjuster understanding that you may have trouble evaluating the claim. When the Plaintiff is represented by a lawyer it is normally expected that the plaintiff make the first offer. The first offer will get the ball rolling. Whatever you do, just be sure that you don’t undervalue your claim on your opening offer.
It is very rare that your first offer will be expected. There is generally some back and forth negotiations between the plaintiff and the defendant over weeks or months. The parties generally inch closer to a settlement over the course of negotiations. It is wise to negotiation all elements of your claim at one time (ie. general damages, special damages, legal fees, costs).
Be warned- limitations periods apply to all claims. The time limit on your claim will continue to run even if you are engaged in settlement discussions with the other party. If you are nearing the limitations period you should consider filing the legal claim to protect your claim. Filing the legal claim will not usually end negotiations. The limitation period is crucial because if you miss the time limit you don’t have a claim to negotiate!
Should a Plaintiff Ever Accept a Low Settlement?
The Plaintiff should never be forced to take less than what is fair. However, there are times where the plaintiff should take a hard look at an offer that is less than what you think you could get in court if your claim went through a trial.
Below are some of the circumstances where a plaintiff may want to consider accepting a lower-end offer:
- your case has evidence issues (eg. you don’t have witnesses, expert evidence is needed, liability is in question)
- your injuries are minor (e.g. soft-tissue injuries, injuries that are fully resolved with no impact long term)
- the Defendant is willing to pay the limits of a policy and your claim may be worth more.
The basic component of the settlement should include payment for medical costs, lost wages, pain and suffering, emotional harm, and any other loss which is attributed to the negligence of another person. Accordingly, if the person did not suffer significant injuring a lower settlement amount will be appropriate.
In the event that the claim is ‘over limits’, which means that the damages may be in excess of the policy, you should consider the offer because the party who is at fault may not have money to pay for the damages beyond the policy limits. As the saying goes, you can’t get blood from a stone. In most cases, individuals (as opposed to some established companies) have no assets to liquidate. If this is the case, it may not make sense to pursue the claim beyond the limits of the policy.
Collections Issues for Larger Injury Claim Settlements
There isn’t a collection issue when an established insurance company is going to pay the claim. There are cases, however, that an insurance company isn’t going to respond to the claim because no policy is applicable to the type of incident which gave rise to the legal claim. The same is true where there is an over-limits claim (discussed above).
In the event that you will be attempting to collect payment from a person (rather than an insurance company or established business), you may wish to determine whether the person is employed, whether they own significant assets, and whether they have any intention to pay the claim. In the event that the person cannot pay the injury claim (which is called satisfying the judgement amount or settlement), you are able to garnish the person’s wages, and register a security interest on their possessions (e.g. house or car). A bigger business will also be more likely to have assets than a small one-man operation. Regardless of who you are trying to collect from, if they don’t have assets there is nothing to take.
By way of example, say the goods in your apartment were damaged due to water damage. The water damage happened because your neighbour left the stove on and the sprinklers were activated to control the fire. You have tenant’s insurance but it only covers $20,000 of damage. The damages to your goods is $30,000. Your own policy will pay the first $20,000 but no more. You will have to seek payment from the person who left the stove on because he was the person at-fault for the incident. If the person has a tenant’s insurance policy which coverage the damage caused by the policyholder, you should be able to have the other $10,000 covered by the at-fault person’s policy. However, if there is no policy you are left without any option but to sue the man personally and hope he has assets. If he has no assets or employment, you likely won’t be able to collect the remaining money. You will be left with a shortfall.
The timing of your settlement is very important. Trying to settle too early may not give you enough time to fully consider your damages. Settling too late may make negotiations more challenging because the Defendant’s legal expenses may be harder. We strongly suggest that you speak with a personal injury lawyer about your claim and the timing of settlement. Be sure that you know what a fair resolution is for your claim before you start settlement negotiations.