Full and final-ish

I’m a big fan of settlements and negotiations. That is NOT because I’m afraid to go to Court (far from it!). What I am afraid of is that no matter what the outcome, it’s extremely difficult to get an order that the client is going to be happy with. No matter how well we do (and I’ve had some great successes over the years) and no matter what the Judge thinks, you never get everything you want. You never get all of your costs. You never get an apology. You are never going to get back the hours and days you might have spent in preparation for and actually being in court. And of course, there’s always the risk that you might lose or that by the time you’ve got all the way to the final hearing, the other side has run out of money and you’ll end up with nothing.

On the other hand, if you settle, you are ending the case on negotiated terms and making a commercial decision. You are weighing up the pros and cons and deciding what is the lesser of evils. You are taking control and taking out the unpredictability of a trial.

However, even negotiations and settlements have their downsides.

Obviously, you’re not going to get your day in court, and even that won’t get you any kind of apology from the other side if the Judge finds against them (or even just makes comments in the Judgement about how your evidence was preferred over theirs) that might give you some satisfaction. You may feel vindicated.

Nevertheless, you would assume (quite reasonably) that in return for giving that up, you’re getting a degree of certainty. A settlement is, by its very nature, full and final. What’s more, if the Judge finds in your favour, the other side could still appeal. Whereas if you do a deal, that is the end of it.

Sadly, as I say probably 10 times a day, there are no guarantees in my world, and full and final settlement agreements are no exception. Given that I’m writing this from Southampton in the run-up to their match against Chelsea this evening I am well used to unpredictability and disappointment. Nevertheless, not unlike my football team, the unpredictability of law never ceases to amaze me and, unfortunately, horrify my clients.

The reality is that nothing is ever completely full and final – no matter what the agreement actually says.

Nothing is ever 100% watertight (no matter how well it’s drafted).

Even once the fat lady has sung, there could still be an encore.

Two cases this week have beautifully highlighted my point.

Firstly, a settlement has been reached in a long-running saga against Mastercard bought by or on behalf of those who were overcharged on transactional fees. However, the litigation funder has indicated that they are going to oppose the deal, presumably on the basis that they don’t believe that they will recover enough to cover their fees to have made it worthwhile. Even though they are not directly a party to the proceedings, if they have an interest in the settlement, they may be able to hold things up, despite the fact that the terms have been agreed by the Claimants and the Defendant. IE a full and final settlement agreement might not be full and final.

Secondly, a settlement agreement in a long-running property dispute case has come under scrutiny when it came to light that the party who, under the agreement had agreed to transfer a property to another party to the agreement now turns out not to have the relevant title in the property to put the settlement agreement into effect. The settlement agreement is currently under court scrutiny for reasons of confidentiality – namely whether and if so to what extent the negotiations that led to the settlement can be disclosed and relied upon. However, it still highlights the fact that simply because something is signed, sealed and delivered, doesn’t mean that the Court can’t rip it all up and make everyone start again. IE a water-tight agreement may actually have sprung a leak that no one was expecting.

And even from here, I can hear the chorus getting ready for their encore.

This does not, of course, mean that if you have the opportunity to negotiate you should turn it down. Far from it. It’s not especially common for settlement agreements to be challenged, and the benefits of mediation still outweigh the risks. What’s more, if you’ve taken the right legal advice, you’ll be aware that there is still no guarantee that this is the end of it.

What it does mean is that if you’re considering court proceedings and your solicitors talk about how difficult it is to predict what will happen and how much it will cost, these are the types of things that can arise that make our world so unpredictable. So don’t think they’re being weak when they warn you of the risks and don’t go down the route unless you are absolutely certain you have the time, money and stomach for it.

Taking that a step further, it’s yet another reason to make sure that you do things properly. Many (but not all) of the cases we deal with would not have arisen or would have been much easier to run if proper contracts were in place, proper records were kept and parties acted promptly. The longer you leave taking action, the harder it can be to achieve anything close to justice.

Kleyman & Co Solicitors. The full-service law firm. Litigious-ish.