September 2005 – Accurate Evalution of Risk Saves You and Your Client Time and Money
Judge Arthur M. Monty Ahalt (Ret.)
The accurate evaluation of risk is one of the first steps to take when making a determination to file suit when settlement negotiations have reached an impasse; but the evaluation process should start early. If you start negotiating with your opponent before you go through a disciplined approach to evaluating the case, you start with a weak foundation. The key here is to start with a strong foundation.
The principles, which are set out here, are based upon my 38 years of experience as a trial lawyer (15), as a judge (17), and as a neutral case evaluator, mediator and arbitrator(6). As a Judge on the Circuit Court for Prince George’s County, I tried over 1,000 jury trials and handled over 10,000 settlement conferences.
If the case will ultimately end up in front of a jury, then you want to evaluate what a jury would award your client in the jurisdiction that you will file suit. If a Judge will ultimately hear the case, then you need to evaluate what a judge would award your client in the jurisdiction that you will file suit. Building a strong foundation will put you at a negotiating advantage with your opponent. It also serves three other strategic functions:
1. Protect you against a claim of malpractice.
2. Give you client control.
3. Allow you to have confidence in front of a Judge or jury.
The process of evaluating a case needs to be disciplined and organized. You want to accurately identify all RISK factors that will affect your recovery. There are positive and negative risk factors. Positive factors increase the value of your case, while negative factors decrease the value of your case. Both are important and you do not want to overlook any. There are also factors which would on the surface appear to affect the value but do not – the red herring factor. A word of CAUTION -you cannot – I repeat cannot – properly evaluate the value of a case until you know all of the facts which are relevant to the issues of liability and/or damages. Once you have accurately evaluated a case you can assess the risk of going to trial or making a decision to arbitrate a case.
Let’s look at two hypothetical cases.
First, the low impact rear end – soft tissue case.
Property Damage – $500
Emergency room – $300
Orthopedic evaluation – $500
X-rays – $300
Physical Therapy/Chiropractic Treatment 12 weeks – $3500
Last demand $10,000 – Last Offer $4000
Second, the clear liability shoulder injury (rotator cuff)
Successful surgery – $15,000
Physical therapy – $3,000
Loss wages school teacher – $5,000
Last demand $80,000 – Last offer $30,000
Now in each of these cases settlement negotiations are at an impasse and you must decide whether to file suit or negotiate a high/low arbitration agreement. In each case you have concluded that you only have a 10% chance of achieving your last demand and your opponent has only a 10% chance of achieving their last offer. Further, you have evaluated the probable range of a verdict for the soft tissue case as $5,000-$7,000 and the shoulder case as $45,000 – $55,000.
If you are able to negotiate a high/low agreement of the last offer and last demand, arbitration would appear to be a clear choice; that is where VirtualCourthouse.com™ comes in. You can file your claim, select a neutral from a growing list of highly qualified neutrals and have a decision in a matter of days rather than months and years if you choose to file suit. Your VirtualCourthouse.com™ cost is $200 as opposed to your trial costs of $2,000 to $5,000. You cut your risk, your cost, your time, AND make your client very happy.
Using VirtualCourthouse.com™ for an arbitration, mediation or Neutral Case Evaluation, the parties accomplish the following on the Internet: (i) Agree on a neutral; (ii) Present the documents which support their case; (iii) Have access to an Online Case File; (iv) Schedule a face to face hearing (if necessary); and (v) Receive the Neutral’s Decision
The VirtualCourthouse.com list of neutrals is not only impressive, but growing.To see the growing list click here
Aaron E. Price, Sr.
Adriane C. Jemmott
Judge Bruce Williams
T. Myron Loyd
William Foote, Jr
Judge John Corderman (ret)
Judge Ed Angeletti (ret)
Judge Monty Ahalt (ret)
Judge Paul Dorf (ret)
Judge Theresa Nolan (ret)
Judge Richard Rombro (ret)
Judge Vincent Femia (ret)
Judge William McCullough (ret)
Libby Houghland Banks
Lillie Loretta Jones
For further information contact;
Judge Arthur M. Monty Ahalt (Ret) Karen Pelton
410-263-6163 Director of Customer Service