Litigation can be a risky enterprise as outcomes are often
uncertain. In order to try and avoid the uncertainty of a
trial, sensible litigants will often consider whether they can
reach a settlement of their dispute with the other side long before
a trial is in the diary. Settlements give certainty and are
very often much cheaper than resolving a dispute at a trial.
However, for all its attraction, settlement must be thought through
properly before a deal is concluded as otherwise disappointment can
arise, as can be illustrated by the recent decision in the Court of
Appeal in Hayward v Zurich Insurance Co Plc.
The facts of the case are straightforward: Mr Hayward injured
his back at work and his claim for damages was settled by agreement
with his employer's insurance company who made a payment to
him. Before the settlement had been concluded however, the
insurer had argued that Mr Hayward had exaggerated the effect of
his injuries. Despite this, a deal was done and
