Over the years, law related television shows have seemed to increase in popularity. From Ally McBeal to Boston Legal and everything in between, the viewing options for those interested in these types of shows is almost unlimited. While, naturally, each show has its own unique storylines and characters, one of the constants (and often the climax) is the drama of a jury trial. From the comfort of their living rooms, viewers are able to watch opening statements, lawyers taking testimony, objections, closing arguments, and even jury deliberations – all in a one hour show, no less.
With the prevalence of such shows, many people outside of the legal arena have developed the idea that most, if not all, cases are resolved by a jury. However, those of us who toil in the business day-in and day-out, know that, in many jurisdictions, the number of personal injury jury trials is actually declining. This phenomenon begs the question: Why do most personal injury cases settle before trial?
One of the primary reasons for the decline in the number of jury trials in personal injury cases is money. All of us have heard the phrase, “money makes the world go ‘round” and that adage holds true in personal injury cases. Getting a case from inception to trial can be a very expensive proposition with costs ranging from the mid-four figures up to the mid six-figures. Most law firms advance these costs for things such as depositions, video depositions, expert reports and testimony, but usually the client has to re-pay these costs from any verdict. In some cases, even if the trial is lost, the Plaintiff is still required to pay the firm back for costs. Therefore, as the costs increase, the financial risk to the client grows thus making the proposition of settlement more appealing as the costs to the client are lower and there is certainty in how much money the client will be receiving. A loose rule-of-thumb when comparing settlements to verdicts is that a verdict needs to be 1.5 to 2.5 times higher than a settlement for a plaintiff to put the same amount of money in their pocket. With this dynamic, it is fairly easy to see why a settlement is often preferable to trial.
There are also court rules that encourage settlement over trial. In many jurisdictions, the parties to a personal injury lawsuit must participate in some form of Alternative Dispute Resolution (ADR) such as arbitration (binding and / or non-binding) or mediation. These methods employ the services of a neutral third party who can sometimes help the parties see the strengths and weaknesses of their case which can often help facilitate settlement.
There are also court rules that encourage settlement. One such rule states, in essence, that if the Defendant makes a settlement offer which is rejected by the Plaintiff and then a verdict is rendered which is lower than the offer, the Plaintiff may be responsible for the Defendant’s costs as well as their own. Again, this financial risk often encourages settlement.
Finally, time is often a factor in avoiding litigation and trials. Frequently, a law suit isn’t begun until after settlement negotiations stall. Once the suit is started, Plaintiffs can often expect to wait anywhere from one to two years (or longer) to even get into a courtroom. Thus, Plaintiffs frequently choose to take a settlement and resolve their case rather than invest years of their lives in a lawsuit.
There are certainly other factors in play in why most personal injury cases settle before trial but the above reasons are a good place to start when examining this issue. If you are injured, hiring an experienced Des Moines, IA personal injury attorney is a great place to start whether your case settles or you find yourself living out the drama of the courtroom.
Thanks to our friend and blog author Christopher A. Johnston of Johnston | Martineau PLLP, for his insight into personal injury practice.