RICHARD L. GILBERTJudge of the Superior Court (Retired)
Helpful Settlement Calculators
There are two essential calculations that often need to be made in the course of settling a case involving monetary claims:
The first analysis is one that both plaintiff and defendant ought to do. An "apples to apples" consideration of an offer can only be made if a settlement proposal is compared to the potential range of trial outcomes after considering the deductions from gross settlement proceeds or gross jury verdicts such as costs, liens and attorney fees.
The second analysis is helpful for both sides, though more often the defense, to calculate the gross settlement amount necessary to cover costs, fees and liens and still generate a net to the client. Few cases settle without some net recovery and it is often a bargaining mistake to make offers that don't recognize that reality.
A Simple Net Outcome Calculator
The link below is to a simple "Excel" spreadsheet that allows you to compare prospective settlements to prospective verdicts and see an apples to apples "net outcome" result.
The "Net Outcome Calculator", workbook tab 1, is designed for use in simple cases, primarily personal injury, to allow a variety of possible settlements to be compared to a range of verdict results.
To use the spreadsheet, you will need to enter the variables that affect the result. These are:
The Calculator will compute the resulting Net to Client based on the assumptions allowing you to compare and analyze settlement options compared to theoretical trial outcomes. Obviously, the calculator can't tell whether to settle or not and doesn't account for strengths or weaknesses in cases, for either side, that affect the final decision of what to offer and what to accept. That's where good lawyering comes in.
Calculating "What it Takes"
The "Gross Estimator" tab contains a spreadsheet that will allow you to calculate how much gross settlement or gross verdict amount is necessary to generate a given net when you know or can estimate costs to date, lien repayments and fees.
To use the sheet, enter the variables:
The worksheet will show what settlement payment or verdict is needed the "clear" the anticipated net. As noted above, the calculator isn't intended to dictate what offers to make or accept or whether to settle. There is no substitute for good judgment.
You should be able to download and save on your computer to use with Excel or compatible programs.
Richard L. Gilbert, Judge of the Superior Court (Ret.), 2630 "J" Street, Sacramento, California 95816
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