Settlement and release agreements
What is a settlement and release agreement?
A settlement and release is a contract that brings the parties to agreement on the outcome of a dispute, settling the plaintiff’s (injured or wronged party) claims and releasing the defendant (wrongdoer) from future claims arising from the same transaction or occurrence. It can prevent or end a lawsuit whether as a result of an injury, breach of contract, or employment dispute, etc.
To reach an agreement, both parties must give up something. The defendant or potential defendant gives the plaintiff the relief she wants–or at least a compromise of the plaintiff’s demands. The relief the defendant offers may be the result of months or even years of negotiation. The benefit to the plaintiff is known as the settlement.
The parties must also compromise to meet the needs of the defendant. This is usually in the form of a release incorporated into the settlement agreement. The plaintiff, in exchange for the defendant addressing her injury, agrees to release the defendant from the current law suit or claim, usually without identifying fault, and also releases the defendant from any possibility of future related claims.
Do you need an attorney to help review a settlement and release agreement?
There is nothing wrong with entering into a settlement agreement – in fact, it is often encouraged. But you should never sign a settlement agreement without having it reviewed by an attorney. The time and money it takes to have an attorney review your settlement agreement is minimal compared to the time and money you will face if you enter into a settlement agreement that does not protect you and waives your legal rights and remedies.