Sometimes, parties want something they could never get in a courtroom.
The most common provision in a settlement agreement that you can’t get in a judgment is a promise to keep the terms of the settlement confidential. Court proceedings are public; mediations are private, as are most settlement agreements.
Note: minors’ settlements and motions for determination of good faith settlement are not confidential. Neither are workers compensation Compromise & Release documents.
Usually, it’s the defendants who do not want public disclosure of a settlement amount because it sets a standard for future settlements and judgments. They also don’t want any publicity which reflects badly on them or could encourage additional plaintiffs to file claims.
While the benefit to plaintiffs is less, such a clause can protect them from predatory questions about the settlement. These nosy folks are usually family and supposed friends who come around asking for money. The plaintiff can simply say they are legally prevented from discussing the terms of the settlement. Whether they agree to part with any of that settlement money then rests on the strength of their backbone.
Plaintiffs’ attorneys may balk at a complete confidentiality agreement, because they want to publicize a good outcome. There are solutions for that objection. Almost all injury cases settle, so publicity about a specific high-dollar result most likely is about a settlement, not a judgment.
Most settlement agreements explicitly state that defendants admit no liability. Notwithstanding that provision, there are ways to satisfy a plaintiff’s need for emotional compensation. Often, such apologies happen orally at the mediation. Under these circumstances, the communication is protected by the cloak of confidentiality which governs the mediation.
If the request is for a written apology, this can be handled several ways, including as a separate, confidential document or a confidential addendum to the settlement agreement. Whether oral or written, the apologies are always carefully worded.
Sometimes the plaintiff wants a business to change the practices which caused the alleged wrong. Depending on the nature of the demand, a business may have already implemented the change or has plans to do so. This could be a change in safety, hiring, or compensation practices, or modifying the configuration of the business space. Perhaps a plaintiff wants a contribution to a charity.
Some expensive changes may hinge on a plaintiff’s willingness to reduce their own recovery.
Settlement Is Better
Settling allows a flexibility in the terms of resolution that cannot be achieved in litigation. A willingness of any party to consider such terms can help get parties to settlement quicker.