Settling a Business Law Claim

Last week the headlines in Canada bore the news of the “settlement” in the Omar Khadr case.

Facing life in prison, Khadr chose to accept 8 years instead with a possible reduction if the jury hearing the facts of the case came back with a lower term.  They didn’t.  The jury would have sent him to jail for 40 years.

If you are Omar Khadr, you’ve made a good deal.

In the litigation end of our firm, settlement is a reality of many of our files.  The statistic that is generally accepted for civil litigation is that 90% of cases settle before trial.

As we are a business law firm, the emotional component that is present in other types of civil litigation (personal injury, family law) is generally not a factor and that makes settlement much more practical – it is a business issue, do the numbers make sense?

Things that need to be considered in settling include, the legal fees that will be incurred going forward, the amount of time it will take to get to trial and the ability to collect your judgment from the party you are suing.

Another consideration in settling is the structure of the settlement.  When you go to trial, a judge can only award you what you are asking for.  If you are defending a law suit and lose, then the judge will order you pay an amount of money.  The judge will not give you time to pay.  However, if you settle before trial, many times you can settle with payments over time, thereby allowing you to control your cash flow.

When I was in law school our profs loved to tell us that a good settlement is one in which neither party is happy.  As a lawyer with 17 years experience I have found that not to be the case.  If a settlement is not something that my client will benefit from (thereby being happy) I will not recommend it.

Inga B. Andriessen, J.D.

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