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Snyder: Litigation Guidelines Should Define Four Settlement Triggers

  • State: California
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Civil litigators tend to observe certain guideposts as mediation triggers, such as the closing of discovery, setting of a trial date, or an order from the court to use mediation.  Because about 95% of civil cases settle before trial, mediation is the norm for almost every area of civil litigation.

Teddy Snyder

Teddy Snyder

In contrast, many California workers' compensation attorneys don’t mediate their cases and are pretty unfamiliar with mediation. Moreover, because a workers' compensation case can last literally for the life of the claimant, some practitioners feel no urgency to settle, even though that ratchets up the case value and expenses.

Instead, certain events should automatically trigger parties to actively pursue settlement:

The injured worker is 61 years old. Once the injured worker turns 62½, any buyout of future medical care must include a Medicare set-aside. That MSA could make this case more difficult to settle. It might increase the evaluation more than any party anticipated and for sure will cause delay. Plus, with professional administration, money is no longer under the injured worker’s control. Settle before Medicare becomes a party.

Indemnity payments reach 70% of the expected total. Once all the indemnity is paid, there is no reserve to fund any part of the settlement beyond future medical. This often puts the employer’s side in the position of paying more than it thinks the case is worth to achieve closure. As for the injured worker, there is little incentive to give up guaranteed medical treatment for life if there is no compensation beyond a sum that may not fully fund future medical needs. A better practice is to monitor the indemnity payout and aggressively move to settlement before the indemnity reserve is depleted.

The date of injury was more than three years ago. The employer’s side has many reasons to want to get claims off the books. This is particularly true for private (non-governmental), self-insured employers who are legally required to pay a bond while the claim is open. “Old dog” claims — those that are more than three years from date of injury — deserve special attention. Widows and widowers receiving death benefits may welcome the opportunity to receive a large cash payment; sometimes they don’t even realize this is an option. In pro per, claimants may also favorably respond to a settlement outreach.

Trial is imminent. Nothing makes people think about settlement more than an upcoming trial date. You’ve lived with these facts for a long time; how can you be sure the judge will see things your way in the limited time available to communicate? Going to trial is a risk. Most people are uncomfortable with the lack of control. They are happier with a negotiated settlement.  

Time to call the mediator

When events pull one of these triggers, it’s time to get serious about settlement. A mediator can help parties define the pertinent facts and law and efficiently bring the case to resolution.

Attorney Teddy Snyder mediates workers' compensation cases throughout California. She can be contacted through snydermediations.com.

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