Key Terms In Settlement Agreement

Concord agreements are subject to the usual contractual provisions. When there are considerations, this usually takes the form of mutual commitments: Party A promises not to make a claim against Party B or to sue it if Party B promises to undertake a specific act for Party A. If the agreement provides for non-monetary commitments, make sure that it takes into account the measures that the parties must take in the event of an infringement: “Without prejudice” communication between the parties trying to settle the dispute is not normally seen by the court. However, litigation related to settlement agreements provides for exceptions to this rule. An exception applies when it comes to whether the communication resulted in a settlement agreement concluded. In such cases, “without prejudice” communications are permitted in order to allow the court to assess whether the parties have agreed on terms. Standard conditions should not be included in the agreement without verification. When negotiating a settlement agreement, it is important for employers to ensure that the parties have reached consensus on the essential conditions. Where the essential elements of an agreement have been settled, their terms are legally enforceable and the refusal to enter into the agreement may give rise to unnecessary litigation and, in certain circumstances, to an increase in cost compensation against the employer. It is therefore important that employers accept essential conditions in settlement negotiations only if they are certain that they are satisfied with the compromise. In addition, employers are warned not to rely strictly on arbitrary deadlines to decide not to negotiate a settlement.

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