Guest Speaker: Richard L. Tousignant
Every litigator has his or her own guidelines of when to place a case in suit. These guidelines can range from “who insures the defendant” to “all cases are placed in suit.”
The general rule is to make a formal demand as soon as final reports can be obtained. Negotiations are then conducted in an attempt to achieve a fair settlement. If negotiations break down the case is placed in suit with the client’s consent.
In today’s personal injury climate the “general rule” doesn’t always apply. There are insurance companies who simply refuse to negotiate. These companies use a computer program to determine fair compensatory value.
When encountering one of these companies, it is usually in the client’s best interest to put the case in suit as soon as a threshold has been met. A position of “all cases against those companies” go into suit should be taken on cases large and small.
Clients deserve and are impressed by action on their file. Keeping a file moving makes the clients aware that something is being done. This creates confidence in the lawyer. I am sure we have all encountered the telephone call where a claimant wants to switch lawyers because “nothing is being done on my case.” That doesn’t happen once a case is placed in suit because there is constant movement and action on the file throughout the litigation process.
Not all cases should be put into suit. Prior to initiating the lawsuit one should be aware of the pluses and minuses of putting a case in suit. This of course will help avoid surprises during the discovery phase of your lawsuit.
Potential Positives to Filing Suit
1. Keeps the case moving.
2. Lets the client know you believe in their case and are working hard for them.
3. Personalizes the claim for the defense attorney (i.e. puts a face to the name).
4. Gives the plaintiff an opportunity to express how the injuries have affected their lives.
5. Assists the plaintiff’s attorney in better understanding the effects the injuries have had on their client’s life.
6. Gives the plaintiff’s attorney some ideas as to how the plaintiff acts under pressure and comes across others during the deposition. (This is probably how they will also act in a courtroom.)
7. Through the discovery process the plaintiff’s attorney gets to know the client better. If the attorney likes the client, chances are the jury will also.
8. Gives the plaintiff an opportunity to vent. Some plaintiff’s just simply want to tell their story before settling their claim.
Potential Negatives to Filing Suit
1. May get a defense attorney who wants to drag their feet for the billable hour.
2. Cost of litigation may be more than the case can bear.
3. Negative facts that you or the insurance company did not know may come out during discovery.
4. Your client’s appearance, attitude, or statements may diminish the claim.
5. Pre-suit is your last chance to deal directly with the adjuster. After suit you will only be dealing with the attorney.
Insurance companies categorize cases. For example, soft tissue cases have settlement value between zero and $15,000. A non-surgical herniated disc case has settlement value between $15,000 and $40,000. This categorization process goes on with all types of cases. When the claim exceeds the basic category standards and it is clear that the adjuster wants to categorize it, the case should be placed in suit. It has been my experience that adjusters will not make an offer outside the “category” unless and until you have impressed on them, through the discovery process, that you are serious about taking this case to trial and that this case is not your “normal category” case.
Cases involving severe injuries or death should always be placed in suit when there is appropriate coverage. It has been my experience that insurance companies will pay more on the severe injury or death case the closer they get to the courthouse steps.
Keep in mind that the adjuster’s job is to save the company money. In support of that statement let me summarize negotiations I recently had with the defendant’s insurance company. I had a case that was clearly valued in excess of their policy limits of $100,000. I made a demand for the full $100,000 policy limits. The adjuster offered $25,000. I immediately placed the case in suit. Upon receipt of the complaint the adjuster called and asked “why wasn’t I willing to negotiate?” What she had clearly hoped for is that I would call back and tell her that while I would not accept her $25,000 offer I would give her some discount off the policy. As soon as she got me to move off the policy, she knew she was going to be saving the company money and it was only a question as to how far she could get me to move off the policy limits. After the case was placed in suit and depositions were taken, the company paid their full policy limits.