A lawsuit settlement refers to two parties ending a legal dispute amicably. This normally takes place between the two contending parties outside of court. An out-of-court settlement may be preferred when court processes are taking too long and are expensive to the parties concerned.
Most lawsuit settlements are brought about after lawyers of both parties meet and agree on certain legally binding conditions. Settlement ensures that the aggrieved party gets compensation for whatever wrong had taken place. Most lawsuit settlements regard financial compensation, which is why the need for a judge is reduced. It is estimated that 95 percent of pending lawsuits end in pretrial settlements, according to the Law Dictionary.