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Settlement Agreement Questions

A settlement agreement is a way to end a civil lawsuit when the two parties involved decide it will be their advantage to end the dispute and settle without further litigation. The agreement is a legal, binding contract between the parties. Usually, the defendant will agree to pay a certain amount of money, either in a lump sum or over a specified period of time, to the plaintiff in exchange for ending the lawsuit. The specific terms and conditions of this contract will be laid out in the settlement agreement.

Listed below are a few questions answered by business lawyers on settlement agreements.

Can a signed handwritten settlement agreement be seen as a valid contract?

A valid settlement agreement that has been signed does not become invalid just because it was handwritten. So yes, it should be valid.

If a settlement agreement is created in a civil court case and the plaintiff and defendants are stipulated as parties to this settlement, do all of them have to sign the document for it to be binding?

Yes, all the parties would have to sign the settlement for it to be binding. You can also proceed to trial with those who decide not to sign the agreement.

I filed a lawsuit against a company and now need to sign a settlement agreement with them. The first part of the agreement states: This confidential Settlement and Release agreement executed on the date set forth below is made and entered between "My Name", his representatives, heirs and assigns, in favor of "Company Name". Is the phrase “in favor” standard usage and what does it imply?

This seems like standard language. From what you have said it seems like the company is paying you and in exchange you are being asked to sign a settlement and release agreement. If the rest of the agreement seems fine, this phrase doesn’t seem like anything you have to worry about.

A settlement agreement from one shareholder’s lawyer to another shareholder’s lawyer first states that they accept the clients offer, then goes on to list properties that are being divided, and then finally mentions the amount of money involved in the transaction. Can this be upheld in court?

If the details of the settlement are listed in the agreement, it can be upheld in court unless one party was defrauded into being a part of the settlement agreement in the first place.

I cancelled a pending trial by entering into a settlement agreement. Part of the agreement was to not disclose contents of the agreement to my customers. This part of the agreement was breached. I am wondering if I can re-open the case based on the occurrence and withhold any payments that were part of the agreement.

To begin with, two wrongs do not make a right: Two breaches do not set everything right. You could go back to court to try and remedy this to the extent that the agreement has been breached. But in doing so, if you then breach the agreement in return, you could face legal consequences and the problem will only worsen.

If the case was dismissed, it would not be possible to just re-open it. Depending on the way the case was dismissed, you might have to re-file it. In the event that the matter has not been dismissed yet, you may still be able to put the issue back on the court's calendar.

Very often, cases can be settled either at the beginning or at some point in the negotiations through a settlement agreement. In many forums, judges welcome the opportunity to allow parties to decide the outcome of their case based on mutual understandings embodied in an agreement. Any agreement reached should also be simple and uncomplicated to lower the possibility of future litigation with regard to breaches of the agreement. Seeking the advice of a legal expert in this matter may be advisable.
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