MUTUAL RELEASE AND SETTLEMENT AGREEMENT

(Medical Malpractice – New Jersey)

[// GUIDANCE: This template is drafted for use in settling a New Jersey medical-malpractice action. All bracketed items must be customized for the particular matter. Confirm that no minor/incapacitated plaintiff protections, Medicare set-aside requirements, or court-approval procedures mandate additional language.]

TABLE OF CONTENTS

1. Document Header & Recitals
2. Definitions
3. Operative Provisions
4. Representations & Warranties
5. Covenants & Restrictions
6. Default & Remedies
7. Risk Allocation
8. Dispute Resolution
9. General Provisions
10. Execution Block

1. DOCUMENT HEADER & RECITALS

This Mutual Release and Settlement Agreement (the “Agreement”) is made and entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and among:

a. [PLAINTIFF FULL LEGAL NAME], an individual residing at [ADDRESS] (“Plaintiff”);
b. [HEALTHCARE PROVIDER LEGAL NAME], a [New Jersey] [corporation/LLC/partnership] with its principal place of business at [ADDRESS] (“Provider”);
c. [HOSPITAL OR FACILITY LEGAL NAME] (if applicable) (“Facility”); and
d. [INSURANCE CARRIER LEGAL NAME], a [STATE] insurance company, NAIC No. [_____], with its principal place of business at [ADDRESS] (“Insurer”).

Plaintiff, Provider, Facility, and Insurer are collectively referred to herein as the “Parties” and individually as a “Party.”

Recitals

A. On [DATE], Plaintiff commenced an action styled [CAPTION], Docket No. [______], in the Superior Court of New Jersey, [COUNTY] Vicinage (the “Action”), alleging medical negligence, lack of informed consent, and related causes of action.
B. The Defendants deny all liability.
C. The Parties desire to fully, finally, and forever settle the Action and any and all Related Claims (as defined below) on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants herein and other good and valuable consideration, the sufficiency of which is acknowledged, the Parties agree as follows:

2. DEFINITIONS

For purposes of this Agreement, the following capitalized terms shall have the meanings set forth below. Defined terms may be used in singular or plural form as the context requires.

“Action” – The civil proceeding identified in Recital A.

“Agreement” – This Mutual Release and Settlement Agreement, inclusive of all Schedules and Exhibits.

“Confidential Information” – The existence, terms, and conditions of this Agreement and all settlement communications, except as disclosure is required by law or for tax, accounting, or regulatory reporting.

“Court” – The Superior Court of New Jersey, [COUNTY] Vicinage, Law Division.

“Defendants” – Provider, Facility, and Insurer, collectively.

“Effective Date” – The date first written above.

“Future Damages Periodic Payments” – Structured payments, if elected, made pursuant to Section 3.2.

“Related Claims” – Any and all claims, demands, causes of action, damages, costs, expenses, and liabilities of every kind, known or unknown, arising out of the facts alleged in the Action or medical services rendered to Plaintiff through the Effective Date.

“Settlement Amount” – The total consideration payable pursuant to Section 3.1.

[Insert any additional matter-specific defined terms in alphabetical order.]

3. OPERATIVE PROVISIONS

3.1 Settlement Consideration

3.1.1 Lump-Sum Payment. Defendants shall pay to Plaintiff the gross sum of $[__] (the “Lump-Sum Payment”) on or before [30] calendar days after satisfaction of all Conditions Precedent in Section 3.3.

3.1.2 Structured Settlement (Optional). In lieu of or in addition to the Lump-Sum Payment, the Parties may elect to fund a periodic-payment arrangement compliant with applicable New Jersey structured-settlement statutes and 26 U.S.C. § 130 (the “Structured Settlement”).
a. Structured payment details shall be set forth in Schedule 1 (Structured Payment Schedule).
b. Any qualified assignment shall be to [ASSIGNEE NAME] pursuant to a separate Qualified Assignment and Release.

3.1.3 Allocation. The Settlement Amount shall be allocated as follows:
• Economic damages: $[_]
• Non-economic damages: $[]
• Attorneys’ fees/costs (subject to R. 1:21-7): $[__]
[// GUIDANCE: Allocation is critical for lien resolution, taxation, and periodic payment compliance.]

3.2 Payment Mechanics

(a) Payments shall be made by wire transfer or bank-check payable to [“PLAINTIFF AND [LAW FIRM] AS ATTORNEYS”].
(b) Interest at [_] % per annum shall accrue on unpaid amounts after the due date until paid in full.

3.3 Conditions Precedent

Payment obligations under Section 3.1 are conditioned upon:
i. Execution and delivery of this Agreement by all Parties;
ii. Filing of a Stipulation of Dismissal With Prejudice in the Action;
iii. Court approval, if required under R. 4:44-2 (e.g., minors/incompetents);
iv. Receipt of final demand letters and satisfaction of all Medicare, Medicaid, ERISA, and private liens; and
v. Receipt of a completed IRS Form W-9 from Plaintiff’s counsel.

3.4 Dismissal of Action

Within [3] business days after the Effective Date, Plaintiff shall file the Stipulation of Dismissal With Prejudice and deliver a file-stamped copy to Defendants’ counsel.

3.5 No Admission of Liability

This Agreement constitutes a compromise settlement and shall not be construed as an admission of liability by any Party.

3.6 Tax Treatment

Each Party shall be solely responsible for its own tax obligations arising from the Settlement Amount. Defendants make no representations regarding tax consequences.

3.7 Lien Resolution

Plaintiff shall indemnify and hold Defendants harmless from any unresolved healthcare or governmental lien asserted in connection with the Action. Payment of the Settlement Amount may be conditioned upon establishment of a Medicare Set-Aside, if required.

4. REPRESENTATIONS & WARRANTIES

4.1 Each Party has full power and authority to enter into and perform this Agreement and has obtained all necessary consents.

4.2 Plaintiff represents that no bankruptcy petition is pending that would affect the enforceability of this Agreement.

4.3 Defendants represent that the Settlement Amount is within policy limits and will be paid without need for court-ordered bad-faith penalties.

4.4 The Parties acknowledge the New Jersey punitive-damages cap set forth in N.J. Stat. Ann. § 2A:15-5.14(b) and confirm that punitive damages, if any, are resolved and waived by this Agreement.

4.5 The representations and warranties in this Section shall survive the Effective Date.

5. COVENANTS & RESTRICTIONS

5.1 Mutual Releases.
(a) Upon receipt of the Settlement Amount, Plaintiff irrevocably releases and forever discharges Defendants from all Related Claims.
(b) Defendants release Plaintiff from any claims for malicious prosecution, abuse of process, or costs (except as provided herein).

5.2 Covenant Not to Sue. Each Releasing Party covenants not to initiate or maintain any proceeding based on any Released Claim.

5.3 Confidentiality. The Parties shall maintain the confidentiality of all Confidential Information, except as required for (i) court approval, (ii) tax reporting, (iii) compliance with mandatory insurer or professional-discipline reporting, or (iv) as otherwise required by law.

5.4 Non-Disparagement. The Parties shall not make statements intended to harm the reputation of another Party regarding the Released Claims.

5.5 Mandatory Reporting.
(a) Insurer shall file any required report with the National Practitioner Data Bank (“NPDB”) within the statutory period.
(b) Provider and Facility shall comply with the New Jersey Division of Consumer Affairs reporting obligations applicable to medical-malpractice settlements.
(c) The Parties shall cooperate in good faith to enable timely, accurate reporting.

6. DEFAULT & REMEDIES

6.1 Events of Default. Failure by Defendants to pay any required amount within [5] business days after written notice of non-payment constitutes a “Payment Default.”

6.2 Cure Period. Defendants shall have [10] business days from receipt of notice to cure a Payment Default.

6.3 Remedies. If a Payment Default is not cured:
(a) The unpaid balance shall accelerate and become immediately due with interest at [_]% per annum; and
(b) Plaintiff may reinstate the Action solely for the purpose of entering judgment in the accelerated amount, plus reasonable attorneys’ fees and costs.

6.4 Attorneys’ Fees. The prevailing Party in any proceeding to enforce this Agreement shall recover its reasonable attorneys’ fees, costs, and expenses.

7. RISK ALLOCATION

7.1 Limitation of Liability. The aggregate liability of each Defendant arising out of or relating to the Action is limited to the Settlement Amount.

7.2 Force Majeure (Structured Payments). Failure of the annuity issuer or qualified assignee to make timely periodic payments due solely to insolvency shall not constitute a breach by Defendants, provided Defendants purchased the annuity from an insurer rated not less than A- by A.M. Best on the Effective Date.

7.3 Insurance. Provider represents that professional-liability coverage for the incident(s) alleged in the Action is in force and will remain so until all payments required under Section 3 are made.

8. DISPUTE RESOLUTION

8.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New Jersey, without regard to conflict-of-laws principles.

8.2 Forum Selection. The Parties submit to the exclusive jurisdiction of the state courts located in [COUNTY], New Jersey.

8.3 Arbitration (Optional).
[SELECT ONE]
☐ The Parties agree to submit any dispute arising under this Agreement to binding arbitration administered by [AAA/JAMS] under its Commercial Arbitration Rules.
☐ The Parties decline arbitration.

8.4 Jury Waiver (Optional). To the fullest extent permitted by law, the Parties knowingly and voluntarily waive the right to a trial by jury in any action arising out of this Agreement.

[// GUIDANCE: Delete 8.3 and/or 8.4 if not elected; ensure mutuality.]

9. GENERAL PROVISIONS

9.1 Entire Agreement. This Agreement constitutes the entire agreement among the Parties and supersedes all prior understandings regarding the Released Claims.

9.2 Amendments; Waivers. No amendment or waiver shall be effective unless in writing and signed by all Parties. No waiver of any breach constitutes a waiver of any subsequent breach.

9.3 Assignment. No Party may assign its rights or delegate its obligations without the prior written consent of the other Parties, except that Insurer may make a qualified assignment under Section 3.1.2.

9.4 Severability. If any provision is held invalid or unenforceable, the remaining provisions shall remain in full force, and the invalid provision shall be reformed to the minimum extent necessary to achieve the original intent.

9.5 Successors & Assigns. This Agreement is binding upon and inures to the benefit of the Parties and their respective heirs, legal representatives, successors, and permitted assigns.

9.6 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each of which is deemed an original, and all of which constitute one instrument. Signatures transmitted by facsimile, PDF, or e-signature platform (e.g., DocuSign) shall be deemed originals.

9.7 Headings. Section headings are for convenience only and shall not affect interpretation.

10. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.

[OPTIONAL NOTARY BLOCK(S) – insert if required for recording or enforceability under N.J. law.]

Schedule 1

Structured Payment Schedule
[Insert annuity issuer, payment dates, amounts, beneficiary designations, and commutation provisions.]

[// GUIDANCE: Attach additional schedules for lien lists, court-approval documents, or qualified assignment forms as needed.]

End of Template