Monday, November 25, 2013

Good Fences Make Good Neighbors

I remember that quote from law school. I would rephrase it in settlement context to Good Negotiations and Documentations Make Good Resolutions

Recent cases around the country have illustrated the pitfalls that settlement or dismissal may present. In Love v. Ryan, an Ohio court denied an injured workers' plea to reopen her case on the basis of unilateral mistake. She sought to set aside a voluntary dismissal that was part of her settlement.   

The Claimant was injured in 2008, and sought care for various injuries. Some were deemed compensable, others were not. In 2011 a dismissal/settlement was entered, signed by the Claimant's attorney. As we sometimes see in Florida, the injured worker then appeared again pro se. The details of her separation from her former attorney are not clear. Her subsequent pro se claim was for "mercy," and she asserted ignorance of the import or effect of the dismissal. She essentially claimed that unilateral mistake should be sufficient to avoid the dismissal. 

The import of the decision is the court's conclusion that the Claimants claim that "she had not seen the judgment before it was entered and/or that her attorney acted beyond his authority in approving the settlement does not constitute a mistake, surprise, or any other ground for relief." The court suggested that if the attorney acted beyond the scope of authority, then the appropriate relief would be somewhere other than against the employer/carrier. Without spelling it out, the import of the Court's decision could be interpreted as "sue your lawyer."

In  a recent Illinois case, Boda v. Caraway, an injured worker sued her attorney claiming that she was urged to settle her workers' compensation case on a compromise basis. Ms. Boda claims that either she or her attorney or both did not realize that the settlement of the workers' compensation claims would "eliminate" Boda's entitlement to social security benefits. How settlement of her case would do so is not explained.

It is not clear why these situations are making news. However, they are reminders of the benefits of careful drafting of agreements between parties and effective communication. They are reminders of the obligations to keep clients apprised of the progress of their case. They are reminders of the need to explain what is meant by offers or demands.

Whether a later claim for "mercy" is successful or not, it still requires resources to defend. For most, the purpose of a settlement is to accomplish a cessation of hostilities, and for all parties to move on with their lives. If well drafted and carefully explained, the effect of a settlement may well be the end of the case. No attorney wants to be sued by a former client, and no defendant wants to defend a later lawsuit to set-aside what they believed was a final closure. 

I sometimes hear anecdotal stories of mediation or settlement frustration. The Claimant or Employer/Carrier appears with "unreasonable" expectations. Some party does not disclose this or that, which is critical to the discussion or settlement. Sometimes this may include other claims (wrongful discharge, discrimination, unemployment, etc.) that are not disclosed, even to the Claimant's attorney. Sometimes this is the Employer/Carrier allegedly not disclosing that resignation or something similar will be a term of the settlement. 

The common theme that may be seen in these situations is that some failure has occurred in communication. In settlement, in negotiation of claims, in legal practice clarity is critical. If an offer is intended to release "all claims," why not say so? Why not list some common examples as above with an "included but not limited to . . .?" If something is intended to be excluded, why not say that? Why not say that "this demand is for settlement of the work accident on mm/dd/yyyy and not for any other claims against the defendant, employer, carrier"? Why not say "this offer is for resolution of all claims that _____________ has against the employer/carrier"? Why not get these issues on the table and deal with them in the process? No such statement is "right" or wrong" necessarily. Is it right to insist on any such term or limitation? That is a far broader question. My point is tell the other side what you will insist upon and do so openly and early in the process. 

Clarity. Tell the other side what you want. Timeliness. The best time to get these issues on the table is early. Why work all day on what you think is a deal and then watch it implode because there was misunderstanding as to what was being negotiated? Documentation. Make that confirmation letter detailed. Make that mediation agreement complete.

Negotiating resolutions is not easy. Attorneys are involved for precisely this reason. If it was easy, anyone could do it. Resolutions require patience, time, and skill. Documentation takes time. Formality takes time. But both are protections for everyone involved in the resolution. 

The Office of Judges of Compensation Claims offers voluntary mediation services. When there is no pending petition, you can make an appointment to discuss the case through a voluntary mediation with your choice of 28 OJCC state mediators around the state. Visit our website or contact me for details on using the voluntary mediation process. 

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