In the world of estate litigation, it’s common for matters to settle before they go to trial. Sometimes matters are resolved through settlement negotiations and, other times, matters resolve at formal mediations facilitated by a neutral mediator.
Settling litigation, whether early in the process or on the eve of trial, generally comes as a relief to clients; it means the end of what is frequently an emotionally exhausting and stressful process, not to mention a costly one.
But what happens after you’ve reached an agreement to settle with the other side? What steps do the parties have to take to wrap up the litigation so everyone can move on?
Once the parties agree, in principle, to a settlement, it is important to document the terms of that settlement in writing. This document is typically called the Minutes of Settlement.
Usually, one lawyer will prepare a draft of the Minutes of Settlement and the lawyers on the other side will review and provide their comments. Lawyers will go back and forth until everyone agrees on the Minutes of Settlement.
The Minutes of Settlement are where the lawyers turn their mind to the many minutiae of settlement that the parties may not have contemplated in their agreement, but that are critical to the settlement. For example, does a settlement payout include taxes? Who is going to pay each party’s legal fees? Now that the litigation is settled, who is going to file with the court the motion dismissing the court proceeding?
If a settlement is reached at mediation, the lawyers often try to get the Minutes of Settlement drafted and signed by all parties before the end of the day, although sometimes this just isn’t possible. Generally, the longer it takes to draft Minutes of Settlement and get them signed, the more likely it is for the settlement to fall apart.
In addition to drafting Minutes of Settlement, the lawyers will also prepare a Full and Final Release for the parties to sign. The Release is intended to ensure that no one can ever re-litigate the issues resolved in the settlement. The Release may also have a confidentiality clause or a non-disparagement clause.
Another consideration is whether the settlement involves a minor or an incapable person (called a “person under disability”). If so, before the settlement is finalized, counsel for the party under disability must bring a motion or application and file evidence to satisfy the court that the proposed settlement is reasonable and in the best interests of the party under disability.
Once the Minutes of Settlement and Releases are finalized, you’re not done quite yet. The lawyers for each side must make sure that their clients comply with any timelines set out in the Minutes of Settlement. For example, Minutes of Settlement may include deadlines for paying settlement funds, for dismissing a court application, for applying for probate, for moving out of a property owned by an estate, or for listing a property for sale.
If any party fails to comply with the terms of the Minutes of Settlement, the other side may bring a motion before the court enforcing the terms of the settlement.
While reaching a settlement means the end of litigation and is something to celebrate, for the most part, it takes a little more work to get things over the finish line.
Nothing contained in this post constitutes legal advice or establishes a solicitor-client relationship. If you have any questions regarding your legal rights or legal obligations, you should consult a lawyer.