5 Things You Should Know Before Agreeing to an Out of Court Settlement for A Personal Injury in New York
People sometimes contemplate whether to file a personal injury lawsuit for some reason. Taking a personal injury case to court may tarnish reputations, damage relationships, or even waste time and huge sums of money. However, these consequences can be avoided with an out-of-court settlement when the parties involved in the litigation decide to resolve the conflict by negotiation.
In New York, approximately 95% of all personal injury cases resolve out of court during the pre-trial phase and never get to the stage of a civil court trial. Recently, there have been several alternatives that can help avoid taking a personal injury case to court and produce win-win solutions for both parties.
Below are 5 Major things you should know before agreeing to an out-of-court settlement for a personal injury in New York;
1. Alternative Dispute Resolution ADR
Alternative Dispute Resolution ADR is a form of out-of-court settlement; it refers to different ways parties can resolve issues without going to court. There are different forms of ADR which are;
- Neutral Evaluation
2. A settlement agreement is regarded as a contract between Parties.
Generally, an out-of-court settlement is a compromise between the parties, and as such, it operates as a contract. A settlement agreement contract should contain the following:
- The names of the parties
- A whereas section that explains the reasons for the contract
- A no admission of liability clause stating that the settlement does not include an admission of wrongdoing by either party
- A promise to pay section stating the settlement amount that the defendant will pay the other
- A payment schedule with details concerning the mode of payment
- A mutual release clause declaring that the parties shall not make claims against each other
3. Out-of-court settlements are treated confidentially
Unlike trial documents, public records that anyone can access at any time and out-of-court settlement files are treated confidentially, especially when the parties involved do not want their personal information to be open to the public.
4. Out-of-court settlement damages are taxable
Out-of-court settlement damages are considered income and, therefore, taxable. However, other types of damages are non-taxable, such as damages received on account of physical injuries and non-physical injuries.
5. Certainty of outcome
Usually, court trials have uncertain outcomes, as the judge's final decision cannot be accurately predicted. However, with an out-of-court settlement, the parties have more control over the process and the agreement's outcome, allowing them to settle the controversy with certainty.
Filing a personal injury claim doesn't necessarily mean your case will get to court. Whether you're pursuing legal action in or out of court, having an experienced lawyer is always best.
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