A settlement agreement records what each side gives and receives. Core terms include the payment amount and timing, the scope of the release, who is released, dismissal procedure, allocation among claims or claimants, lien responsibility, confidentiality, and any indemnity for unresolved liens.
It is interpreted as a contract, so ambiguity is resolved under ordinary construction principles rather than by reference to the parties' litigation positions.
Alternative Names:
Settlement Contract, Release Agreement
Why it Matters?
Most post-settlement disputes trace to drafting rather than negotiation: an unresolved lien with no indemnity provision, a release that names the wrong entities, or an allocation that creates tax or Medicare consequences nobody addressed. In multi-party cases, whether the release discharges non-settling tortfeasors is a state-law question that must be checked rather than assumed.
Frequently Confused with
Related terms
Frequently asked questions
What are the most commonly missed terms?
Does settling with one defendant release the others?
