Settlement vs. Litigation: What Should I Do After a Car Accident?

After you’ve suffered a personal injury in a car accident, you may have no other choice than to pursue a civil claim in the Superior Court of Justice.  Perhaps it is because your insurance company refuses to provide coverage, or because the other driver caused you a debilitating injury.

Before you begin, you need to decide what the goals of your claim will be.  This is something best done in consultation with your personal injury lawyer, but ideally the net result will cover your current and projected expenses (both medical and legal).  Once you have determined this amount, the litigation process begins:

  • Filing the claim: This is usually done by your lawyer, and involves filing the claim with the Superior Court of Justice and serving it on the Defendant(s).  The amount of the claim will generally be higher than your goal, in large part so that you have the space to negotiate towards a settlement.
  • Mandatory mediation: This is a relatively new phase in Ontario in non-family civil court actions, mainly used in Toronto, Ottawa, and Windsor.  Both parties must come to a confidential meeting wherein a professional mediator will attempt to clarify the issues and hopefully settle the case.  Both parties must agree on a mediator within 30 days of the defence being filed, and meet for mediation within 90 days.  They must also provide the mediator with a statement of issues.  If a settlement cannot be reached during mediation, the litigation process continues.
  • Discovery: This is the stage where evidence is gathered.  This includes getting statements from doctors and witnesses, as well as acquiring records.  Both parties may demand documents from the other to help build their case.
  • Trial: This is where the evidence is presented and adjudicated.  There is a choice in most cases between trial by judge and trial by jury.

At any point during this process – up to and including the trial – a settlement offer can be made and accepted, at which time the claim will be brought to a close.

All trials involve risk. Witnesses may fail to show up or prove unreliable.  Jurors are hard to predict.  And, in cases of personal injuries after car accidents, compensation is limited by a required threshold for non-pecuniary damages (also known as general damages, or compensation for pain and suffering).  This means that to receive those damages, the judge – not the jury – must agree that the personal injury sustained is permanent and causes serious impairment of an important function.  If the judge does not believe this to be the case, general damages will not be awarded, even if a jury has decided they should be.

To decide if a settlement offer is reasonable, you will want to consider:

  • How close is it to your original goal?
  • Does it cover your expenses so far, including your legal costs?
  • Will it cover the expenses you are likely to incur?
  • Do you think it is fair?

The decision of whether to settle or to proceed in court after a personal injury from a car accident is an important one, and not a choice to be made lightly.  While the sooner the claim is settled the sooner you can concentrate on recovering, you must still take into account the strength of your case, as well as the fairness of the offer.  With a strong case and a fair offer, you can gain proper compensation for your injuries.

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