Why Cut A Deal?

An old legal proverb says, “A decent settlement is better than a good trial”.

Why would it ever be better to settle a case for less money than you think you can get a trial?

Reason one: The operative phrase in the sentence above is “… think you can get…”. You don’t know how a trial is going to come out. Your lawyer can try great case – you can be a great witness – your opponent can get on the stand and sound like a buffoon. 11 people on the jury can want to give you $1 million. But if just one juror doesn’t like you for some reason, you can wind up with zero. You just never know.

Reason two: Trials are expensive and are physically and mentally draining. Example: Your opponent offers you $6000 before the trial starts; you turn it down because after your lawyer takes his one third fee, you’ll only get $4000. The trial starts on Monday; you can’t sleep the night before. The trial lasts two days (you don’t feel like eating or sleeping Monday night). You miss two days of work and lose $500 in salary. The jury gives you $7500. Your lawyer takes his 1/3 fee, plus $500 in witness fees and other trial costs. You get $4500, but you only net $4000 because of your lost salary. Do you feel better, or worse?

Reason three: Getting a judgment doesn’t mean collection. The scenario in Reason two above gets even less inviting when you realize that a $7500 judgment still has to be collected. What if your opponent is penniless and therefore “judgment proof”, but was going to borrow the $6000 that he offered you in settlement from his grandmother because he was afraid of going to trial? Once he realizes that you can’t collect the judgment against him, it may just sit there for 10 years and you will get nothing.

If your lawyer recommends a settlement, it’s usually because he or she has been through the above scenarios and seen that clients often wish they had settled beforehand once their trials are over. As nice as it would be to be able to punish the worthless so-and-so on the other side, you should remember another old proverb – “A bird in the hand is worth two in the bush”.

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