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Settlement is Not Always Best. Trial Can Be Much Better!

Settlement is Not Always Best. Trial Can Be Much Better!

Conventional wisdom often expresses the belief that settling is better than trial on the merits of a legal dispute. Settlement has its place, of course. But "settling" a case is always like "settling" sediment in a water container… a common low level is found, not a correct or just level. Losing is risky. Settling can bring certainty. But, both prevent winning. And, most people are in business to win!

Michigan Lawyers Weekly reported in December 2006 that a three-member arbitration panel in a breach a contract case between two Michigan-based Tier-One automotive suppliers, one of them over $14 million. The case apparently could not have settled for a sum near this.

The result may be part of a new trend in disputes between large businesses: "These are two large tier one corporations and, typically, you don't have much in the way of litigation between them. It's rare to see that… [Suppliers generally] try to resolve these issues in a business format. I don't if this [case] is the wave of the future or if it was a real aberration." This comment was made by the counsel for the prevailing party.

The winning party got a benefit from seeing the case through that was at least as important as the money. As the winner's lawyer said of final adjudication: "the finding of the arbitrator and the judgment that was entered vindicated [the client's] position… [and was] gratifying" to the company.

In business, winning is often called "everything". So, why do businessmen buy into the idea of settling so easily, when doing so given "everything" up forever?

Trial isn't for every case. But, settlement isn't either.

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