How Your Case Moves Forward After the Demand Letter

Your case has reached a critical point in the negotiation of a settlement following the opposing party’s response to your demand letter. Demand letters are used to clearly communicate your claim and the amount of money you believe you should receive for the damages you have incurred. However, every action taken by the opposing party at this stage will require your attorney to develop a comprehensive strategy.

1. The Defendant’s First Response

After the defendant’s first response to your demand letter, the process moves forward based on their actions. The main purpose of a demand letter is to formally state your claim to the defendant and request compensation for the damages you have suffered. When the defendant receives your demand letter, the defendant’s insurance carrier will typically review your claim to ascertain how much responsibility the defendant owes and whether there is enough evidence to support your claims. The defendant may also contact you requesting more documentation related to your claims prior to making a determination on the claim. Based on the defendant’s response to your demand letter, your case will either settle or proceed to litigation.

2. Beginning Settlement Talks

If the defendant decides to engage in negotiations regarding your claim, you and the defendant will likely commence settlement talks. This stage follows the defendant’s review of your demand letter and any requests for documentation. Generally, the defendant will propose a settlement offer that will be less than your original demand. Your attorney will evaluate the defendant’s settlement offer to determine if it is a reasonable settlement based on the evidence in your case and the value of your case. The objective of the settlement negotiations is to arrive at a mutually acceptable settlement that settles your claim and eliminates the possibility of litigation.

3. Evaluating the Counter-Offer

Before your attorney accepts any settlement proposal from the defendant, your attorney will need to consider your total loss (past and future) when evaluating the value of your claim. Types of losses that should be considered include medical expenses, lost wages resulting from work absences, loss of personal property, and mental anguish. If the defendant’s proposed settlement is insufficient to provide adequate compensation for your total loss, you may wish to reject the proposal and pursue litigation.

4. Pursuing Litigation After Settlement Talks Fail

If the negotiations between you and the defendant fail to produce a settlement, the process will shift toward litigation. To initiate litigation, your attorney will file a complaint with the appropriate court. Upon the filing of the complaint, the defendant will be required to respond and thereby commence the legal process, which may ultimately result in a trial.

5. The Discovery Process and Pretrial Matters

Once the complaint is filed, the discovery process will begin. During this process, both you and the defendant will exchange information through various means, including depositions, document production, and interrogatories. The discovery process provides you and the defendant with an opportunity to collect and review evidence, and at times, the evidence collected may prompt renewed settlement negotiations prior to trial.

6. Methods of Resolution

While litigation and trial are possible, alternative dispute resolution options may also become available after discovery begins. In mediation, a neutral third-party mediator assists the parties in reaching a mutually agreeable settlement. Arbitration is a more formal method of dispute resolution whereby a third-party arbitrator makes a binding or non-binding decision. Both mediation and arbitration can provide time savings, financial savings, and reduced stress, while also providing a fair disposition to a dispute.

Key Takeaways

• Demand letters are used to formalize your claim and potential settlement.

• The response of the defendant to your demand letter will determine the course of action that Your Case will follow.

• Settlement discussions are designed to reach a fair and reasonable settlement that avoids going to court.

• If you do not settle through negotiations, filing a complaint initiates the formal discovery process and the steps leading up to trial.

• Mediation and arbitration can be viable alternative options to resolve disputes quickly and cost-effectively.