If you settle your caseby paying part or all of the debt
You may settle your case at any time prior to having the court make a decision (a judgment)by either:
- Paying the full amount of the debt (plus any fees, costs, and interest required)
- Negotiating to pay alesser amount and having the other side agree to accept that amount as full payment
Like any other agreement you negotiate, this agreement should be confirmed in writing.
If a creditor has an attorney, all communications, negotiations, and payment must go through the attorney's office (unless you have instructions to do otherwise.)
Have the Plaintiff dismiss the case
Your case won't be dismissed automatically if you settle. The Plaintiff shoulddismiss the case as part of your agreement.
As part of your agreement, you should have the other side agree to dismiss the lawsuit it has filed with prejudice. This legal term is an important part of your agreement because it means that the Plaintiff can't file another lawsuit against you for the same debt.
Once you've completed a writtenagreement and you've paid the amount you agreed on, the Plaintiff should dismiss the case andserve you with a copy of the Request for Dismissal (form CIV-110) before itfiles that form with the court. Alternatively, the Plaintiff may file a Notice of Settlement of Entire Case(form CM-200) and file the dismissal within 45 days.
Settling after a judgment
If instead you pay or settle after a judge makes a decision in a trial (after a judgment is entered), you should still confirm the arrangement in writing, and the Plaintiff should issue an Acknowledgment of Satisfaction of Judgment (typicallyform EJ-100). The plaintiff will either file a copy of this form with the court or will send you a notarized copy of this form.
If you agree to make payments over time
If you agree to settle a lawsuit by making payments over time, there are several ways that you and the Plaintiff might handle the agreement to pay overtime:
- Draft a new contract and dismiss the case
You and the plaintiff could draft a new contract describing your agreement for making payments and thendismiss the case. If you break the contract, the plaintiff can file a new lawsuit. - Draft a settlement agreement and conditionally dismiss the case
You and the Plaintiff draft an agreement that says thecase will be dismissed, and you will make payments over time. If you break theagreement, the plaintiff can ask that the dismissal be vacated(canceled) and the case continue. - Draft a stipulated judgment
You and the plaintiff draft an agreement that says the court will order you to pay the specific amount (orenter a judgment against you). But that the plaintiff will not enforce the judgment as long as you make monthly payments. If you don't make monthly payments, the plaintiff can ask the judge to order you to pay the full amount minus payments you've made and may seek to collect.
