- Don’t Forget to Negotiate the Nonmonetary Terms of Your Settlement Before You Reach a Final Settlement
- February 20, 2015 | Author: Betsy G. Ramos
- Law Firm: Capehart & Scatchard, P.A. - Mount Laurel Office
- Often parties are so focused on the monetary terms of a settlement, that they forget that there could be material nonmonetary terms that are important as well. Once a monetary offer is made and accepted, unless it has been made clear that there are other terms that are required to reach a final settlement, the other party could legitimately take the position that a final settlement has been reached and could move to enforce the settlement as binding - without those nonmonetary terms being included.
Some standard nonmonetary terms that are typically included in a personal injury settlement include the following:
- Blanket release
- Child support judgment search
- Lien documentation
- Medicare conditional payment letter
- W-9 of plaintiff’s attorney
When the offer is conveyed, there should be a discussion of the closing documentation that will be required to effectuate the settlement to avoid a dispute over whether these documents are required to complete the settlement.
Sometimes a party desire that a certain form of release be used, additional parties be added to the release (such as an insurance carrier or a parent or subsidiary of the named party), or a narrow release be used (such as a release only as to certain claims and not a blanket release). If other than the boilerplate form of release is desired, any special language must be negotiated before a final settlement is reached.
Parties also need to consider whether they want a settlement agreement to memorialize the settlement - not just a release. If so, that needs to be made clear to the opposing counsel when the offer is conveyed - that the offer is subject to memorialization in a written settlement agreement.
Other nonmonetary terms that should be considered in a negotiating a settlement, depending on the type of case, include:
- Venue and jurisdiction clause (if a dispute arises over the settlement, what court would have jurisdiction to resolve the dispute?)
- When is the settlement check due?
- Are attorney’s fees being released? (This should always be addressed in any nonpersonal injury release.)
- Nondisparagement clause
- Tax treatment of settlement monies paid
The point of this article is that often there are nonmonetary terms to a settlement that are very important to a party. They should be discussed and negotiated at the same time as the monetary terms or they may end up not included in the settlement.