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Litigation With A Positive ROI
When to Litigate and When to Settle
If you find yourself in a controversy with another party that seems to have no agreeable solution, one way to reconcile the situation is to litigate.The process may not be the easiest, or the cheapest, so before taking such action it’s important to decide if litigation is what you really want to do. Here is more about litigation, and when you should just settle instead.
What is Litigation?
Litigation is the process of taking the controversy though the court system (i.e. filing a lawsuit). However, before it even gets that far, there are a few things that could happen. First, the party with the complaint will inform the other party about the controversy, or “present the claim.” In the claim, the aggrieved party states why the other party is responsible for the damage done or harm suffered. Some claimants will offer a proposed solution to the problem, others may not. Some may also threaten a lawsuit. If an agreeable solution cannot be reached, the complaint can be taken to court and elevated to a lawsuit.
Litigation is usually a very lengthy process, and can be very costly. Besides court fees and attorney fees, there are also costs to hire witnesses, costs of studies and reports, costs to analyze those reports, copy fees, deposition fees, paralegal fees and investigation fees. The list could go on and on. It is not always the best solution, especially if an agreement can possibly be reached. However, in cases where one party is refusing to settle, then litigation may be the only solution.
When is it Better to Settle?
Some claims get put to rest before they even see a court room. However, some settlements do not occur until it’s close to trail. Here are some instances where it might be a good idea to agree to a settlement rather than taking the case through a lengthy court process.
- The trial will cost you more money than you can gain from it. Imagine you are plaintiff in a lawsuit and your attorney informs you that you could likely win $10,000. He also tells you that the trial, plus all the fees you will have to pay, will cost close that amount. In this case, a settlement for a lower dollar amount, to avoid the fees of litigation is likely a better choice.
- Your legal costs are just not worth it. Whether you are the plaintiff or the defendant, if your total costs for the trial exceed what you will possibly win (or have to pay), then a settlement is a better option.
- The outcome of the case is unpredictable, and you can’t afford to lose it. If you find that your case appears to be a toss-up and it seems there may be a good chance you may not even win, you are better off settling. Yes there is still a chance you could win and take home the large sum of money, but if you don’t win, you will be out court fees, attorney fees and much more.
- The claim is against someone close to you. As sad as it is, it does happen. Family members, colleagues, friends and business partners sue each other. In some cases, it seems as though the lawsuit was necessary at the time, but after a while the parties realize that the relationship is too important, and will likely be destroyed if the lawsuit continues. Litigation can be a hurtful process when it’s between people that actually care about each other. When both parties agree that the relationship is important, reaching a settlement is often the best choice.
Taking a controversy through the litigation process is a big decision. It is one that will likely take up much time and money, and if it involves people you care about, it is likely to ruin relationships. In some instances, it is better to settle then it is to go through the litigation process. However, there are some cases where litigation is still necessary. If you need to file a complaint, or have found yourself on the receiving end of one, give us a call and we can assist you.
1930 N. Arboleda, Suite 201
Mesa, Arizona 85213
40 N. Central Avenue, Suite 1400-1532
Phoenix, AZ 85004
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