Hawk Law Group | October 25, 2024 | Personal Injury

Can a Lawsuit be Reopened After Settlement?

Most lawsuits end in negotiated out-of-court settlements, not courtroom verdicts. If the defendant refuses to honor the terms of the settlement, the plaintiff can simply sue the defendant based on the settlement agreement. If the lawsuit is successful, the plaintiff will get the amount of money they originally bargained for. This can be a problem if you suffer late-breaking problems such as nerve damage or diminished earning capacity.

Under certain limited circumstances, however, it is possible to rescind a settlement agreement. The party seeking rescission bears the burden of proving the grounds for rescission. Rescission of the settlement agreement can reopen the personal injury claim upon which the settlement agreement was based. This means that the plaintiff can refile the lawsuit and litigate their claim again. This approach may or may not result in more compensation.

How Personal Injury Settlement Agreements Work

In a personal injury settlement agreement, the defendant agrees to pay the plaintiff a certain amount of money. The plaintiff agrees to abandon their personal injury claim against the defendant permanently. If they haven’t filed a lawsuit yet, they agree to abandon their right ever to file one. If they have already filed a lawsuit, they agree to withdraw the lawsuit in exchange for the defendant’s promise to pay the settlement amount.

How Personal Injury Settlement Agreement Lawsuits Work

If the defendant breaches the terms of the settlement agreement by refusing to pay, the plaintiff can file an additional lawsuit. This time, the lawsuit is not based on personal injury. Instead, it is a breach of contract lawsuit based on the terms of the settlement agreement. If the plaintiff wins the lawsuit, the court will award them the amount of their original settlement. They might also award an extra amount for attorney’s fees and interest based on the delay in payment.

Possible Grounds for Rescission of A Settlement Agreement

If the plaintiff wants more money than the amount agreed to in the settlement agreement, they can seek to rescind the settlement agreement and relitigate the case in court. Courts rarely allow rescission of a settlement agreement, but sometimes they will do so based on:

  • Fraud: The defendant misrepresented important facts during settlement negotiations.
  • Mutual mistake: Both sides based the agreement on a misunderstanding of a crucial fact.
  • Duress: You were coerced into settling unfairly.  
  • Lack of capacity: You were mentally incompetent and, therefore, unable to provide meaningful agreement to the settlement.

Remember–rescission doesn’t mean you’ll end up with more money. In fact, there’s no guarantee you’ll even win your lawsuit the second time around.

Options After Rescission of the Settlement Agreement

If you successfully rescind the settlement agreement, you can refile the original lawsuit under most circumstances. This means that you’ll have to start from scratch and litigate the entire case again. This involves significant legal risk for you. 

Statute of limitations Problems

The statute of limitations normally sets a hard deadline for you to file a lawsuit. Imagine this scenario, however. You file a personal injury lawsuit in time to beat the statute of limitations deadline. You settle, and, as per the terms of your settlement, you withdraw your lawsuit. Later, you find out that the defendant fraudulently concealed information that would have justified a much larger settlement. 

Consequently, you ask the court to rescind the settlement agreement. They do, but by the time that happens, the statute of limitations deadline has already expired. If you cannot sue again because of the statute of limitations bar, you cannot even enforce a private settlement. So what do you do? The short answer is that sometimes courts will let you refile the lawsuit under these circumstances, and sometimes they won’t. You might get lucky, but there is no guarantee. 

You’re Going to Need a Lawyer

The complications involved in reopening a lawsuit after signing a settlement agreement are considerable. Many things could go wrong, and you aren’t likely to succeed if you try to represent yourself. Contact the experienced Georgia personal injury lawyers at Hawk Law Group to schedule a free consultation and discuss reopening your case. 

For more information, please contact the personal injury lawyers at Hawk Law Group at our nearest location to schedule a free consultation today.
We serve throughout the Central Savannah River Area and its surrounding areas:

Hawk Law Group – Augusta, GA
338 Telfair St, Augusta, GA 30901, United States
(706) 722 3500

Hawk Law Group – Evans, GA
4384 River Watch Pkwy, Evans, GA 30809, United States
(706) 863 6500

Hawk Law Group – Thomson, GA
146 Railroad St A, Thomson, GA 30824, United States
(706) 361 0350

Hawk Law Group – Waynesboro, GA
827 Liberty St, Waynesboro, GA 30830, United States
(706) 437 9122

Hawk Law Group – Aiken County, SC
156 Laurens St NW, Aiken, SC 29801, United States
(803) 226 9089

We also serve in Edgefield County, SC.