Many car accident or other personal injury cases ultimately result in settlements because insurance companies for both sides will be reluctant to bear the expenses of taking cases to trial, and settlement agreements typically involve both parties signing a settlement and release agreement. The settlement and release agreement will effectively end a dispute and establish the terms the parties agree to, including payments.
It will be incredibly important to detail the claim that is being settled to release a party from liability, as releases may apply only to certain categories of claims. While parties who are defendants will certainly want to prevent all possible future litigation, some people may wish to preserve their rights to file additional claims. California Civil Code § 1542 establishes that a “general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.”
Discuss any settlement with a personal injury lawyer before you ever sign anything.
All settlement and release agreements need to be thoroughly examined to ensure that they are as complete as possible. In general, most settlement and release agreements will consist of the following sections:
Liability waiver forms or releases of claims allow one party a release from liability and having to pay additional claims. Any release will need to include an identification of all the parties involved, details about an accident, a person’s injury claims, details of the proposed payment, and the governing law and enforceability of the agreement.
In most agreements, the injured party is known as the releasor while the at-fault party is the release. There will usually be a release of an obligation to pay, meaning that an injured party will not receive any more payments from the at-fault party.
The injured party signing the settlement and release agreement will be forfeiting their right to sue the other party. The negligent party will also want to include language indicating that they are not admitting any fault relating to an accident as part of their settling the claim.
In October 2021, California Governor Gavin Newsom signed Senate Bill 331 (SB 331 or the “Silenced No More Act”) and placed multiple restrictions on settlement agreements, non-disparagement agreements and separation agreements. Additional measures signed by Newsom in recent years have included SB 1431, SB 820, SB 1300, Assembly Bill 740 (AB 749), and AB 2143.
When people are negotiating settlement and release agreements, they will want to be sure they employ legal representation that understands how serious these agreements can be. An experienced lawyer will know how to achieve the most beneficial agreement in your circumstances.
One major concern needs to be whether a person wants to get a broad or narrow release of claims. In addition to considering whether an agreement will relate to pending litigation or arbitration, there can also be instances of claims related to particular agreements, claims arising out of certain events, or claims relating to a relationship between parties.
People also need to consider whether they want to release another party from unknown claims, as some issues can arise later. There can also be concerns about which parties are subject to a settlement and release agreement, as some people may want to include representatives, agents, or other related parties.
The date of a settlement payment will also be a major concern, as will be confidentiality terms relating to a settlement and release agreement. A settlement agreement often includes a provision explaining confidentiality obligations and parties usually agree to keep the terms of a settlement confidential, but parties may wish to share the existence of a settlement agreement.
If you are in the process of trying to negotiate a settlement to a personal injury claim in California, you are going to want to be sure that you retain legal counsel so you can have the best possible chance of recovering all of the compensation that you need and deserve. The Cartwright Law Firm, Inc. has offices in San Francisco, Vacaville, Discovery Bay, and Santa Rosa, and we respond to phone calls 24 hours a day, seven days a week.
Our firm has a wealth of experience in personal injury matters, and we begin by conducting independent investigations of accident scenes before calculating possible damages and then negotiating with insurance companies to achieve fair and full settlements. You can call (415) 433-0444 or contact us online to receive a free consultation with our Bay Area personal injury attorney.
