USA Law and Practice Contributed by: Courtney Scobie, Jack Edwards and Andrea Whitley, Ajamie LLP
as others believe they protect the privacy and interests of the parties involved. The enforce- ability of these provisions can depend on state law and the specifics of the agreement. 8.3 Enforcement of Settlement Agreements Settlement agreements in the USA are typically enforced as contracts. Once the parties involved in a lawsuit reach a settlement and both parties sign the agreement, it becomes a legally binding contract. The enforcement of settlement agreements gen- erally follows the following principles. • Contractual obligation – a settlement agree- ment is a contract between the parties and, as such, it is legally binding. Each party is obligated to fulfil the terms and conditions specified in the agreement. • Filing a lawsuit for breach – to enforce a settlement agreement, the aggrieved party typically files a lawsuit for breach of contract in the appropriate court. The aggrieved party must demonstrate that the other party failed to meet their contractual obligations as out- lined in the settlement agreement. • State laws and jurisdiction – the enforcement of settlement agreements is subject to state contract law, as contract law is primarily gov- erned at the state level. Courts in the state where the lawsuit was originally filed usually have jurisdiction over the enforcement of the settlement agreement. 8.4 Setting Aside Settlement Agreements Settlement agreements in the USA can be set aside or invalidated under certain circumstances. The process for setting aside a settlement agree- ment involves legal proceedings and is subject to specific criteria. Some common grounds on
which settlement agreements may be set aside include fraud or misrepresentation, duress or undue influence, lack of capacity, mutual mis- take, material breach of the settlement agree- ment, or a public policy violation. Setting aside a settlement agreement is not common and requires a legal process in court. The party seeking to set aside the agreement must provide evidence supporting their claim. 9. Damages and Judgment 9.1 Awards Available to the Successful Litigant The following are among the most common forms of awards and remedies available to suc- cessful litigants. • Monetary damages – successful litigants may be awarded monetary damages, which are intended to compensate them for losses incurred owing to the defendant’s actions. The types of monetary damages include: (a) compensatory damages – these are designed to compensate the plaintiff for actual economic losses, such as medical expenses, lost wages, property damage, or other quantifiable losses; and (b) punitive damages – in cases of wilful mis- conduct or egregious behaviour, punitive damages may be awarded to punish the defendant and deter similar conduct in the future. • Equitable remedies – in some cases, a suc- cessful litigant may seek equitable remedies, which aim to provide fair and just relief rather than monetary compensation. These rem- edies include: (a) injunctions – an injunction is a court order that requires a party to take certain
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