Settlement versus Trial

A 2009 study from Cornell University found that nearly 70% of all civil cases settled out of court. Attorneys and mediation firms alike will tell you that most civil cases are settled out of court, but if your case is in the early stages of moving forward, you may wonder about the advantages of settlement out of court and proceeding to trial. Understanding both, as well as the advantages and drawbacks of the two, can help you make the right decision for your case.

Defining Settlement

In many cases, a settlement out of court might be the right way forward. This simply means formally resolving the lawsuit before it reaches a trial in a courtroom before a judge and jury. Reaching a settlement can happen at any time during the duration of your case, and sometimes it even happens after a trial has started. When that occurs, it’s usually referred to as a settlement in court. In some cases, a settlement may be reached as the result of mediation. In others, it can be reached after a plaintiff’s demand letter is sent. No matter how the settlement is reached, though, both parties sign a formal document that not only establishes the terms involved, but also says the plaintiff can’t sue the defendant at a later time. That release often comes with particular terms like confidentiality agreements and an agreement that the plaintiff must actually receive the money before the settlement is complete.

Understanding a Trial

A trial occurs when both the plaintiff and the defendant go to court, present their arguments before either a judge or a jury, and then liability is determined. A trial typically involves a number of steps. If a jury is involved, that occurs first. After that, opening statements from both sides are presented, witnesses are allowed to testify and are then cross-examined by the other party, closing arguments are presented, then a verdict is delivered by either the judge or the jury. Cases can take some time, but there are a number of cases that take only a few hours or a day or two at most. Either way, going to trial means quite a bit of preparation for both sides.

The Advantages and Disadvantages of Settlement versus Trial

Both settlements and trials offer advantages and disadvantages for those involved. Knowing both may help you make the right decision for your case.

Settling a Lawsuit Means

Predictability: Both parties know exactly what’s going to happen and when.
Faster Timeline: Settlement can typically be achieved fairly quickly if both parties agree to the terms involved, and that can mean moving forward much faster.
Lower Costs: Attorneys fees, court fees, and more are typically far less costly during the process of settlement.
Confidentiality: Settlements tend to stay out of the public eye, which can help protect the privacy of both parties involved.
No Admission of Wrongdoing: A defendant does not have to admit they were wrong in the course of a settlement. Instead, agreeing to settle simply means agreeing not to go to court.

Going to Trial Means:

Larger Potential Awards: Jury awards are sometimes far larger than the funds a plaintiff might get during settlement. Conversely, a jury could award zero, saving the defendant from paying damages.
A Longer Timeline: It may take months or even years to reach the stage where you go to court. Once you’re in court, you could be there a few hours or a few weeks depending on how much evidence is involved in your case.
A Higher Price Tag: Trials tend to cost more overall, both for plaintiffs and defendants. While a plaintiff might get more from the verdict, it is also likely his or her attorney fees will be much higher.
A Defined Public Record: Every trial becomes part of the public record, so if the defendant is found guilty, it is possible for anyone to learn that information in the future. It is also possible the case will be used as a precedent in future trials.

Which Option Is Right In Your Case?

Every case is unique, so it can be difficult to decide whether settlement out of court or trial is the right way to go in your case. Sometimes it makes sense to go to trial, particularly if your case is fairly valuable and the insurance company just isn’t being reasonable. In other cases, though, it simply may not be worth your time to wait on a trial to begin. The best thing you can do is to talk with your attorney about what might be the right way forward. Do your own research about cases like yours and the likelihood of success at trial, talk with your attorney, friends, and family members about what they think might be the right choice, then make your decision. Ultimately, it’s up to you to decide how to move forward with your case.