Most Disputes Settle

It sometimes comes as a surprise to people to learn that in many areas of law most disputes settle before a judge or jury has had time to render a judgment and award some type of remedies to a successful party.  As mentioned earlier, perhaps as many as a quarter of disputes settle quite promptly, for example, after a lawyer has sent an initial letter to the opposing party.   It is also common for matters to settle after a Statement of Claim has been provided.  A Statement of Claim sets out the Plaintiff’s formal position as to the wrong doing that has occurred, the remedies sought and the critical facts that they have to support their position.  Often, after receiving a Statement of Claim, a Defendant will take steps to solve the problem so as not to be embroiled in litigation.

Another significant activity that occurs in litigation is examinations for discovery.  During examinations for discovery lawyers ask the opposing parties or a representative of a corporate opponent questions to determine the evidence that they have to support various positions that they have taken and to clarify contested issues in the litigation. It is quite common for matters to settle either before examinations for discovery (because examinations for discovery are quite costly to prepare for). Matters often settle after examinations for discovery have occurred because at that point they will better understand their evidence, their opponent’s evidence and the quality of at least one witness each party will likely put forward.

Matters also settle “on the Courtroom steps”.  In other words, once people have had a chance to actually prepare for trial, they may have a much better idea of the strengths and weaknesses of their position. Often at this point they have also had a chance to receive and digest expert reports that may be critical for them to understand their strengths and weaknesses in the litigation.

In some respects, the litigation process can be looked at as the activity of repeated iterations of investing more money to get more certainty around legal and factual questions at issue.  Parties will settle, sometimes, when that uncertainty is at a sufficiently low level (and a reasonable settlement offer is made).

In our next article in this series, we will consider how Canadian and US litigation varies, why judges and outcomes can be unpredictable and start to dip into some goals and objectives behind litigation.