A settlement of a case means that both sides have to agree to the terms of the settlement, how much money is paid and when it is paid as well as any other terms the parties may agree upon.  Many people get the idea that they can simply demand a certain amount of money or they will only pay a certain amount  and the other side will agreed to it.

Think about that for a minute.  If you go out to buy or sell a car,  it has a fair market value – what fair minded people would pay for it.  A 2003 Ford Tarrus in good condition with 70,000 miles on it has a value that people are willing to pay. Assume for the moment that the fair market value is $4,135.00 for that year, make, mileage and condition.  Just because the seller wants more money and inflates the price by $30,000 does not mean that you or someone else would pay that much.  The same is true about the value of a case.

If someone offers to buy the car for $500, the seller has no risk in turning down the offer.  It’s not close to what the value of the car is and what a reasonable person would pay.  If, however, he gets an offer of $4000.00, he risks that there may not be anyone else willing to buy the car at that time for more money.  He might lose his chance to sell the car on a timely basis, so he may seriously consider selling the car.  He’s got something to lose if he doesn’t sell at that price.  Namely, owning the car and taking the risk that it may not sell for a long time and not having the immediate availability of the money from the sale.

In a lawsuit, the risk is that a witness may not make a good impression.  Someone may question the motives of the person who caused the injury to the driver.  If the driver who caused the injury had been drinking alcohol, a jury may not believe him when he testifies about how the accident occurred.   Someone also may question the motives of the person who was injured.  Are they likeable?  Did they try to get better such as following the doctor’s treatment?  You get the idea.

A number of factors go into valuing a case.  If it’s settled, both sides have to reach an agreement that fairly values the case and the risks that either side may lose at trial.  In the end, if a case is settled, both sides have to be reasonable in valuing the case.  Normally, when a case is not settled, it’s because the defendant is not willing to pay the reasonable value of a case.  To win at trial, a plaintiff has to convince all of the jurors to vote in favor of them, both that the wreck was caused by the other driver and on how much should be paid to fairly compensate the injured person for their injures, pain and suffering, and future care and impairment (what they still won’t be able to do as a result of the injury).  A defense verdict can occur when all of the jurors vote against a plaintiff or when the jury cannot reach a verdict – because  not everyone agrees on the same verdict (it only takes one person on a jury not to agree that the plaintiff should win for the jury not to be able to reach a verdict even if all the others vote in favor of the plaintiff in Alabama.  Juries in Alabama have to reach a unanimous decision – everyone agrees to the same verdict).  Plaintiff’s take those risks into account when trying to settle their claim.

So, simply asking for the moon won’t get a case settled nor will refusing to pay the reasonable value of a case.  Both sides have to agree to the terms, otherwise there is not a settlement.  That’s what trials are for, to resolve disputes when the parties cannot agree to the terms to settle a case.

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