I have recently come across a number of situations where the most expedient solution will be for the parties to agree a commercial settlement and move on.
The case of Jacobs v Skidmore Owings & Merrill 2012 is a reminder to record very clearly what is being settled. The dispute was over what was intended by Skidmore agreeing to pay some fees to Jacobs and also award further contracts to them over a two year period as compensation for unpaid fees on a project in the Middle East.
The issue in question boiled down to the Courts interpreting what was meant by one word "award". Offering an opportunity to tender was felt not to be good enough, concluding a contract was deemed to be the essential requirement in this case. The background facts are complex but its worth mentioning Jacobs had turned down an offer to tender they felt was unsuitable.
The morale is if you want to avoid expensive litigation over the meaning of settlement terms set out what you intend fully. Creating Settlement Agreements or Deeds of Settlement is a sensible way of compromising a position with out admitting liability or ending up in Court.
It is often the way forward if you are involved in a Court action as it brings the action to an end.
You can use it to bring around the table a number of parties -the employer/contractor /consultants in a non adversarial way and agree creative solutions such as providing labour or materials for free; agreeing alterations to contract terms and so on - instead of paying money.
Jacobs v Skidmore is worth noting though.