Settlement Offer Letter

What is a settlement offer letter?

A settlement offer letter is a formal written request sent by one party to another suggesting an amicable resolution to a dispute. This letter could be used either during the litigation phase or before bringing a dispute to the court.

Drafting a legal settlement offer letter is a first step aimed at resolving a conflict on mutually agreed terms. This type of letter remains a popular document in civil, inheritance, business, or employment disputes.

The parties involved in this type of letter are a sender and a recipient. If there is an existing court dispute, those parties might be referred to as a complainant and a defendant. A sender could be a complainant or a defendant depending on who is willing to settle the dispute. It is also possible that the original parties to a dispute are being represented by their attorneys, who are keen on ending the dispute without much ado.

It is vital to bear in mind, however, that it is not possible to use a settlement offer letter in the circumstances listed below:

• in criminal cases, despite the case’s subject;
• once a court has issued a final decision in a court case;
• once existing contractual arrangement does not allow parties to make a settlement (e.g., this is common for insurance cases).

How to create a sample settlement offer letter?

When you draft a sample settlement offer letter from scratch, try to include the list of essential components listed below:

Details of the Dispute or Incident

A sender should start a letter by identifying the details of a court dispute or incident that took place between the parties. If required, a sender may also attach additional documents to explain circumstances.

Suggested Settlement Terms

The heart of every legal settlement offer letter is the terms and conditions of a settlement. Most popular clauses that are normally being included are:

• amount of a settlement/compensation;
• statement regarding the release of all claims;
• no admission of liability statement; and
• deadline for acceptance of the offer.

Next Steps

Every good settlement offer letter example must explain further steps of negotiations for a recipient. In particular:

• Contact Details. The text of a letter should reflect a sender’s contact information, including email and phone number.
• Acceptance. The sender may specify inside a sample settlement offer letter how a recipient may accept suggested terms—e.g., send a message.
• Timeline. It is also possible to specify the exact timeline within which a recipient shall have a right to accept suggested terms.

Signature

Once a settlement offer letter template is ready, a sender must sign it. After putting a signature, a sender becomes bound by its provisions. If a sender is represented by its attorney, in that text the text of a letter shall incorporate the full name and contact details of the attorney, along with the attorney’s signature.

Delivery Method

The sender may choose from various options for delivering a settlement offer letter to its recipient. Those options include:

• delivery of a letter in person;
• delivery by email;
• deliver by a courier; or
• delivery by general mail.

In some court cases a sender may need to present written proof of sending a settlement offer letter to a recipient. In that case it is always better to keep an acknowledgment of a letter’s delivery, especially in case of a courier dispatch or a normal post.

How to customize a letter template at FasterDraft?

To get a fully customized settlement offer template, follow a few easy steps below:

1. Click the “Create Document” button.
2. Answer simple questions in the form.
3. Select a template’s format—settlement offer letter PDF or Word.
4. Make a payment.
5. E-sign, download, print, and send the letter.