Settlement and Mutual Release Agreement in Massachusetts

Any time that a legal dispute has been resolved, or “settled”, short of trial, the parties will want to draft and sign a Settlement and Mutual Release Agreement. This release agreement is a legal document that defines the nature of the dispute and that the parties have mutually agreed to a settlement that may include a cash settlement, non-disparagement clause, and an agreement to not pursue any other future cause of action against each other that stems from or is related to the underlying dispute. It may also include an NDA or non-disclosure provision that bars the parties from discussing the settlement or any of its terms or it will allow the party offended by the disclosure to either re-open litigation or to claim and recover certain damages.

The document also releases the parties from any claims, known or unknown, at the time it is signed. It may also include a statement that a party does not admit any liability or responsibility for any alleged action or omission to act but has agreed to a settlement in order to end the litigation or dispute.

Common Sections in Settlement and Mutual Release Agreements

There are many different sections that can be included in a settlement agreement that are specific to the cause of action or underlying dispute. But for most settlement agreements involving personal injury or legal malpractice, these may include these general provisions:

Discovery of additional facts and law—in the event the parties uncover or discover facts that were unknown at the time of this release or if the law changes after its effective date, or the parties were unaware of a specific law relating to the dispute that might have affected its outcome, the parties nonetheless are bound by the settlement. This is important because sometimes, years later, someone will need additional surgery, or other medical attention. You cant go back and claim these damages if you have signed a release.
Representation by Counsel—the injured party acknowledges that they have engaged legal counsel who has reviewed and approved the settlement and its provisions. It’s important to review the release with your lawyer and understand what is in it and what is not in it.
No Assignment—the parties acknowledge that they have not assigned their rights or obligations to any other party regarding this dispute or lawsuit and agree to reimburse the other party for all legal and other related expenses if such assignment was made and a claim or lawsuit is filed that arose out of this dispute. Notes that there is a lien by Mass Health, or your health insurance company that has to be repaid in many cases.
Settlement Purpose—no party admits to any liability or admission of fault or an acknowledgement as to the validity of any claims asserted and that this settlement is not an admission of fault or liability by any party.
Governing Law—the law governing the interpretation or construction of the agreement’s provisions is that of Massachusetts or any other relevant state laws if the parties agree to it
Venue/Selection of Forum—should any disagreement or allegation of breach of this agreement arises, it shall be litigated or handled in the district courts of Massachusetts and that neither party may assert that they are not subject personally to the court’s jurisdiction or that the dispute is being brought in an inconvenient forum, or that the subject matter may not be brought therein. If the parties agree, then the sole form of litigation can be by binding arbitration by any mutually agreeable person or persons acting as arbitrators and by the rules governing such proceedings and any appeal to the arbitration ruling is waived unless fraud in the process is alleged.
Binding Effect—that this agreement is binding on the parties and inures to their benefit and to that of their heirs, representatives, and assigns
Construction—parties agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party are not applied to this agreement.
Attorney’s Fees—the parties agree to pay their own attorney’s fees and costs incurred in this dispute, except that should any party bring a legal action relating to this agreement or any enforcement of its provision, the prevailing party is entitled to recover reasonable attorney’s fees, costs and any other relief to which that party may be entitled.
Entire Understanding—this agreement and any exhibits attached to it constitutes the entire agreement of the parties and that no statements or representations made by any party was an inducement to enter into it except as written herein, and that no changes, additions, modifications, or alterations may be made to this agreement except in writing by the parties or their authorized representatives; and that no party will claim that any provision has been so changed or altered by an oral communication of any kind.
Warranty of Authority—the parties who sign this agreement expressly warrant that he or she has the authority to bind them to the agreement via their signatures.
Non-Disclosure – in legal malpractice and in many cases against corporate entities, the insurance attorneys request a non-disclosure and non-disparagement section of the settlement documents.

Settlement and Mutual Release in Legal Malpractice Claims

As indicated above, in legal malpractice cases, there is generally a different type of release. A client will make a claim or bring a lawsuit against their attorney for having acted or having failed to act in such a manner that caused the client harm. A typical legal malpractice claim is that the attorney failed to file a lawsuit in time or within the statute of limitations for that cause of action so that the client is now barred from claiming any compensation.

Other types of legal negligence claims are:

Settling a case without the client’s knowledge or consent
Disclosing private or confidential information to a third party without the client’s consent
Forging a client’ s signature on a document
Taking client’s funds from a trust account for personal use or other misuse of client funds
Failure to know the law that leads to an adverse result that should not have occurred had the attorney followed the law
Missing a deadline that leads to penalties or dismissal of a case
Otherwise failing to use reasonable care that would be expected of a reasonably prudent attorney

Should the client and attorney settle the dispute in this manner, the “release” will generally release and protect the attorney from any further or future claims by the client against the attorney that are related to this specific dispute. It does not protect or release the attorney from any similar claims made by the client for any other, unrelated transactions that may have taken place involving these same parties. For example, the attorney may have allegedly committed legal malpractice in the underlying dispute that was a real estate transaction and which the parties agreed to settle. However, that attorney may have also allegedly committed negligence in a separate, personal injury manner for this client that is unrelated to the subject of this Settlement and Mutual Release Agreement.

Any legal negligence claim that you may have against your attorney should be explored by a legal malpractice attorney who has handled such claims in the past, and has experience with these types of releases.

Retain a Legal Malpractice Attorney from Burns and Jain

Any legal negligence claim will be vigorously defended by an attorney since an adverse resolution could result in a significant settlement or jury verdict. Contact a legal malpractice attorney from Burns and Jain if you feel your attorney’s actions were unwarranted, unethical, or illegal. Call us today at (617) 277-7423 for a free consultation about your claim.