How does accepting a settlement affect my legal rights?
A settlement is an offer from a defendant to stop a claim being brought or continued in court. Part of the rules that govern civil proceedings encourage people to make settlements to stop the case continuing as an overall attempt to keep legal costs down. If a settlement offer is made then you should consider it carefully; failure to do so can mean that costs decisions may go against you if you do go to court and even if you win the case. If you make an offer to the defendant which they don’t accept and then the judge awards more than you offered, then the defendant will be ordered to pay your costs. If the situation is the other way around and the defendant makes an offer to the claimant which the claimant doesn’t accept and then the claimant fails to be awarded the amount offered by the defendant, then the judge will usually award costs to the defendant.
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If you are a claimant and you make a settlement offer to a defendant, which they accept, then you will have your litigation costs so far paid by the defendant, up until the date of the acceptance. When the offer is accepted, the claim will be stayed and the money must be paid to you within 14 days.
A settlement offer is made under Part 36 of the Civil Procedure Rules and requires that the offer is in writing and must say that is a Part 36 offer. The offer must specify the date on which it expires which must be at least 21 days from the date of the offer. The Part 36 offer must specify whether or not it relates to the whole claim; if it does not, then it should specify how much of the claim it relates to. It is best to agree an offer when possible in any civil claim; the reason for this is that the costs of litigation in court are usually very high. If you can settle then you avoid paying court fees, solicitors’ fees and any further fees relating to the litigation. You should bear this in mind when making or considering a settlement. Accepting a settlement doesn’t affect your legal rights, but it will have an effect on any future payout.
