Taking a lawsuit all the way to trial can be expensive, stressful, and time-consuming. Moreover, each side rarely knows for sure what to expect when their case goes to a jury. This uncertainty often motivates the parties to reach a compromise outside court rather than leaving the outcome to chance. A settlement can be reached relatively soon after the case is filed if the facts are clear, or it may be reached after the discovery process concludes. Gathering evidence can give each side a better sense of how a judge or jury likely would resolve a dispute. At other times, they may not reach a settlement until just before the trial date.
Some states require the parties to participate in a settlement conference before they can take a lawsuit to trial. It is relatively short and less formal than a trial, although a judge will oversee the conference. They may hold it in the judge’s chambers or in a conference room. If either or both parties have an attorney, the attorneys also will attend the conference. If a company is involved, it will need to send someone who has the authority to reach a settlement on the company’s behalf.
Procedures in a Settlement Conference
The parties will give the judge some background information about the case so that they can prepare to help resolve the disputed issues. The judge will meet with the attorneys for each side, who will present their positions. The parties do not always attend this part of the meeting.
Once the attorneys have presented the case for each side, the judge will meet with the plaintiff and the defendant separately. The judge may transmit several offers and counteroffers, while also making their own recommendations. However, the judge cannot force the parties to agree to a settlement against their will. If they cannot reach an agreement, the case will continue toward trial. If they do reach an agreement, the attorneys for the parties will work together on a document that lays out the settlement. The parties will review and sign this document, and then the judge will dismiss the case.
If a first settlement conference fails, this may not be your only opportunity. The judge may suggest another attempt at a settlement once more evidence is uncovered.
Common Situations Involving Settlement Conferences
Perhaps the most typical example of a settlement conference is in a personal injury case. The plaintiff (usually an injured victim) and the defendant (often an insurance company) reach an agreement on the amount of compensation that the defendant will pay the plaintiff for their injuries. This will be based on the strength of the plaintiff’s evidence and the extent of their harm and the related costs. Often, the parties exchange several counteroffers before reaching a settlement that suits both sides.
Another common example is a breach of contract case. The parties might be contesting both the existence of the breach and the extent of any damages resulting from the defendant’s alleged breach. Many contracts contain a liquidated damages clause, but sometimes the parties will agree on a lesser amount if the plaintiff does not have a clear-cut case for liability.
A settlement conference also can be a useful way to resolve a divorce or child custody case. This can allow the spouses to handle these private matters with greater dignity than discussing them in open court. The spouses may disagree on only a few aspects of a divorce, which may make it easier to reach a settlement. For example, they may agree to adjust the division of assets in exchange for reducing spousal support (alimony) payments, or they may change their child custody arrangement while modifying child support payments.