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More and more construction cases are settling because lawyers know juries can prove to be unpredictable. The litigation process, as well as any actual trial, can be stressful, expensive and quite lengthy. Settlements are, for the most part, private while suits are public. Current reports find more than 90% of civil cases filed in state circuit courts are disposed of before trial. When that doesn't happen, things could go very poorly, as the case below illustrates.

The Case

Adam was seriously injured in a collision with a dump truck owned by Bang and driven by Tomas. While suit by Adam against Bang and Tomas was pending, Adam suggested they settle by having Bang pay him. Upon receipt of the offer, Bang's lawyer reached out confirming that his client was okay with the settlement amount but wished to add that the settlement also include the satisfaction of a lien filed by Adam's workers' compensation carrier. Adam's attorney refused that additional request, but that didn't stop Bang's lawyer. Based on the fact that Adam had agreed to the settlement amount, the lawyer filed a boiler plate notice of acceptance of settlement and had Bang issue a settlement check payable to Adam in the amount Adam had requested. Adam remained unwilling to compromise. He continued to resist the modified terms, which added satisfaction of the worker’s compensation lien. Bang then filed a motion to enforce settlement, arguing that since there was agreement on the settlement amount, Adam was required to do the deal.

Who was right? The court sided with Adam, determining there had been no meeting of the minds. If an acceptance is not the mirror image of the offer in all material respects, it would be considered a counteroffer. The result was a bad day for Bang, which ended up going to trial and being hit with an adverse jury verdict in the amount of $1,960,000.

Contractors find themselves immersed in legal disputes for obvious reasons—the quality of their work, the time they’ve taken to complete the project or when payments due are either not forthcoming or reduced. A recent survey noted that the average length of time to resolve a construction dispute is 17.5 months. No wonder settlements are favored.

A good settlement likely results in both parties to the dispute leaving something on the table; rarely does a settlement allow one party to recover everything he or she was seeking. But a settlement does bring a level of finality and certainty to an otherwise unsure result.

It is always tempting to push the envelope when negotiating a settlement. But as the Bang case above illustrates, a bird in hand is always better than two in the bush. Trying to get just that little bit more could regrettably derail an otherwise good settlement.


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