Should I accept a High-Low Agreement in my case?

If you were injured in a medical malpractice incident, you may have decided to seek reparation by filing civil litigation. During the course of that litigation, your attorney may inform you that the defendants are proposing something called a “High-Low Agreement.”

A high-low agreement might be proposed by the defense if they feel that you and your plight will resonate well with a sympathetic jury. The defense might fear that the jury will render a decision not only in your favor, but with damages in excess of their insurance policy limits.

These offers are frequently extended to parents who filed suit on behalf of minor children who were gravely and permanently injured from a negligent act that occurred during their birth. Seeing pictures of a young child with spastic quadriplegia or cerebral palsy has a powerful effect on juries, even if the defendants feel that they are presenting a strong defense to the allegations.

For many reasons, some cases proceed to trial without any serious discussions of settlement taking place. Perhaps the defendant is willing to settle, but the insurance company is balking.

Some defendants wait until a trial has begun before tendering an offer of a high-low agreement. They may perceive that the jury is leaning toward a decision favoring the plaintiff and want to cut their losses. They might even wait until the jury is deliberating to extend the offer. This is how it works:

Both plaintiff and defendant reach agreement that the outcome of the litigation can be no less than a certain low sum and not exceed a pre-set high sum. Should the jury return its verdict in plaintiff’s favor, they will receive the higher amount. However, if the verdict is for the defense, the plaintiff gets the low offer.

These type of agreements are both enforceable and legal. When a minor is a plaintiff, the judge should approve the agreement. He or she will appoint a neutral attorney to be the minor child’s Guardian ad Litem with authority to either agree to or decline the settlement. Once approved, the settlement is binding.

If such an offer is tended in your case, discuss the pros and cons with your attorney before making the decision to accept or decline.

Source: findlaw.com, “High-Low Agreements: A Viable Settlement Alternative,” accessed May. 05, 2015