Negotiation Stage

Many personal injury claims are settled at the negotiation or mediation stage rather than an actual trial. In fact, statistically, approximately 98 percent of personal injury cases will settle without a trial. That does not mean many cases do not get close to a trial. In fact, in our experience, many of the cases are set down for trial and we are waiting for the trial date and are completely ready for trial before the case settles.

This is because regardless of how persuasive an individual personal injury lawyer may be, the fact of the matter is persuading another person has a lot to do with the balance of power between the two parties in a situation where one person’s gain will be another person’s loss.  In a personal injury claim if the victim is to receive more, than the auto insurance company will have less money for profits for their shareholders – in Alberta all auto insurance companies are private, for-profit insurance companies (This is a hint – they are not on your side and will not look after your best interests).

Power of Persuasion

Thus, one must understand the power dynamics at a negotiation or mediation. An unrepresented victim (someone without a personal injury lawyer) does not have any power whatsoever as the multi-million dollar auto insurance company knows that the unrepresented individual cannot take the case to trial and have a judge order the insurance company to pay the victim a fair amount for his or her damages.

Even with a personal injury lawyer retained, the balance of power does not really shift until the matter is set down for trial and the auto insurance company is facing the potential of a judge ordering the defendant auto insurance company to pay significantly more than they are currently offering, plus costs of the victim. In this scenario the balance of power becomes even and a negotiation much easier.

Assuming the balance of power is equal, there are still some aspects which are helpful to persuasion. The first is the personal injury lawyer and his or her victim client should have a mindset that is open and curious about the point of view of the other side and be willing to listen to the other side’s position. The time to push is not at mediation or negotiation. The time to push is when the matter goes to trial. When you push at a mediation or a negotiation, people tend to become defensive or resistant.  Essentially the personal injury lawyer and his or her client should have a mindset entering a mediation of being strong in their position and ready to explain their point of view; while at the same time ready to listen to the other side.

Secondly, even after listening and explaining your position, persuasion sometimes relies upon being creative and developing options for possible resolution that neither party has not thought of before. In personal injury claims an example of this are structured settlement agreements which, under The Income Tax Act, can result in tax-free monthly payments, indexed to inflation, which results in a larger net payment to the victim with a smaller gross outlay by the auto insurance company.

Other creative options are partial structured settlements and lump-sum payments. Finally, one can be creative with respect to how one views various heads of damages and how each of them should be quantified given the particular facts of the situation and the victim’s personal employment situation, and household situation.

Handel Law Firm is Alberta’s serious personal injury and fatal accident law firm serving the cities and areas of Red Deer, Fort McMurray and Grande Prairie.