The vast majority of personal injury claims in California are resolved by way of a settlement before going to trial. This is a written contract typically called a settlement agreement or a release of claims. The scope of such an agreement depends upon the terms of the contract and the circumstances surrounding the agreement. Our office recently created a flow chart to explain how cases that get settled before trial and those that go to trial are handled. Until you see a copy of this (request one by calling our office) we want to explore these issues and why it’s crucial to have an attorney represent you if and when you decide to settle your claims for bodily harm.

What’s The Likelihood Of Settling Before Trial? Statistical averages tell us that there is a 93 percent chance your personal injury-claim will be resolved by way of settlement prior to trial. This is not to say that all claims will settle but, the vast majority of claims are able to be resolved before trial. Some claims proceed to trial if the parties are simply too far apart on their estimation of value and the likelihood of prevailing seems equally weighted. In cases like this both plaintiffs and defendants are usually represented by attorneys who have a fairly good idea of how to value cases and what is a reasonable settlement figure. This combined with the costs of taking a case to trial and the potential adverse risk for the defendant in having a judge or jury award a much higher amount than what was offered or for the plaintiff to receive a much lower amount (or nothing) for their claims than what they demanded for resolution and this is what usually leads both sides towards a reasonable settlement that takes into account the risks involved.

What’s The Process To Settle A Bodily Injury Claim?This depends upon the stage at which the case resolves, the age of the plaintiff(s), and several other factors but, the process normally happens as follows:
1. If No Lawsuit Has Been Filed: In the absence of litigation, the settlement is reached prior to court proceedings. The procedure here is for the insurance company or defendant to prepare a release or settlement agreement, have the plaintiff execute the agreement and then issue a check for the total amount to the plaintiff’s attorney or to the plaintiff themselves if they are in Pro Per. At that time, medical liens must be paid out of the proceeds or the injured party may face legal claims for payment at a later time. If the plaintiff is a minor, the release and settlement agreement is executed on their behalf by the plaintiff’s parent or legal guardian and, if the settlement is in excess of $5,000, the arrangement may need to be approved by a judge in what is called a “Minor’s Compromise Hearing” . Upon disbursement of settlement funds, the attorney should provide a full, written accounting for payment of every penny of the gross amount. This will include payment of outstanding medical bills or other liens, costs, attorney’s fees and the net amount to be paid to the client.
2. If A Lawsuit Is Pending: If a legal action has been filed in court and is proceeding towards trial at the time of settlement, the parties will usually file a “Notice of Settlement” with the court to advise the judge that a resolution is pending. The defendant’s attorney will prepare a settlement agreement, which includes a release of all present and future claims. This will be signed by the plaintiff (or their parent or guardian in the case of a minor), and an exchange will be made for the signed settlement and release agreement plus a “Request for Dismissal” of the lawsuit, on the one hand, and a settlement check on the other hand. The “Request for Dismissal” is the formal document which dismisses the lawsuit usually “with prejudice” (meaning without the ability to re-file any subsequent actions. After settlement funds are paid, the same process occurs where the attorney (or party) should pay for any outstanding liens and the lawyer should provide a full, written account of how much was paid, to whom and what the net recovery is for the injured party.

Are Settlements Final & Binding? With rare exceptions, the answer is YES. Once a plaintiff claiming bodily harmed caused by negligence executes a release and accepts payment, the claims cannot be brought up again against the party being released. In fact, every standard release agreement for personal injury claims in California usually always includes an explicit waiver which reads as follows:

“A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”

By including a waiver of this provision into the settlement and release agreement, the party being released is requiring the settling party to waive off not only present claims that they know about but, any future claims that they may not even realize they have.

Why Is It Critical To Have Guenard & Bozarth Review The Terms When Negotiating & Finalizing Your Settlement?
One of the best known tricks in the insurance adjuster handbook is the “quick settlement” offer to the unrepresented and unsuspecting injured party. Insurance companies (unlike Guenard & Bozarth) have no interest in you making a full and complete evaluation of present and future medical expenses and a pain and suffering award commensurate with the full value of the medical condition. They would much rather dangle a check and give you a couple of thousand dollars for your troubles. Far too many people fall into this trap, sign a release of present and future claims, accept what they don’t realize is a paltry sum and then find out later that their need for treatment is much more extensive than initially realized. Don’t be a victim twice!

At the Law Office of Guenard & Bozarth we are familiar with the tricks of the insurance industry and how they work against you. Our office has a former insurance company defense attorney that knows the tricks of the trade and works on your behalf! Call our office at 888-809-1075 or visit our website at and let us protect your rights. We Can Help!