The Difference Between An Informal Settlement And A Formal Lawsuit

11 May 2018 by Jonathan Phillips

Personal injury law is the branch of the legal system that allows people to sue other people after wrongful injuries take place. This includes injuries from car accidents, dog bites, medical malpractice, and many other things. When a person faces injuries in a way that fits into this specific branch of law, the person can settle the matter in one of two main ways: an informal settlement or a formal lawsuit.

What is an informal settlement?

An informal settlement is often the better way to settle a personal injury case, but it is not always an option. Through an informal settlement, your attorney will work with the other party in the case. This might be the other party's lawyer, their insurance company, or both. The goal of an informal settlement is to reach a mutual agreement about the value of the case. If this can occur, you will not have to go to court for your case. Your lawyer will draw up a contract with the other party, and both parties will have to sign it. After both parties sign the contract, you will receive your settlement, and the case will end. You will never be able to go after the other party for additional funds after you both sign the agreement.

The benefits of settling in this way are that you can often settle faster and that you will not have to leave the decision of the matter in the hands of a court.

What is a formal lawsuit?

If your lawyer cannot reach a mutual agreement with the other party, you will have no other way to settle the case than to use a formal lawsuit. With a formal lawsuit, you are the plaintiff, and the other party is the defendant. Your lawyer will file the lawsuit, and the court will hear the entire case. After hearing the case, the judge or jury will be responsible for determining fault in the case as well as the value of the case. When a case requires a formal lawsuit, it can cost a lot of money to go through and can take a lot of time to settle.

If you were injured by another person, you might be able to sue for damages. To find out if you can, schedule a visit with a personal injury lawyer from a firm like Trump & Trump. They can help you decide whether to pursue a settlement or lawsuit. 

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