Personal Injury Settlement Agreement - Alabama

ALABAMA PERSONAL-INJURY SETTLEMENT AGREEMENT AND RELEASE

This form is for a negotiated settlement of identified personal-injury claims by a claimant with confirmed authority and capacity. It is not a minor-settlement petition, wrongful-death settlement, estate settlement, structured-settlement transfer petition, Medicare or Medicaid compliance opinion, lien-resolution opinion, or court order.

1. PRE-SIGNING AUTHORITY AND SCOPE WORKSHEET

A. Claimant Capacity and Representative Authority

Ala. Code § 26-1-1(a) generally relieves a person of the disabilities of minority at age 19. Subsection (f) separately permits an unemancipated 18-year-old of sound mind to enter a binding contract as an individual of full legal age. Age alone does not resolve every capacity, guardianship, conservatorship, competency, or representative-authority issue.

• Claimant's date of birth: [__/__/____]
• Claimant's age on signing date: [____]
• Claimant signs personally: ☐ Yes ☐ No
• Representative, if any: [NAME, TITLE, AND SOURCE OF AUTHORITY]
• Guardianship, conservatorship, power of attorney, estate, or other authority documents reviewed: ☐ Yes ☐ Not applicable
• Court approval or protective proceeding required: ☐ Yes ☐ No ☐ Counsel must determine

Do not use a parent or guardian signature as a substitute for the approval, findings, fiduciary authority, or restricted-distribution process that may apply to a person lacking full capacity.

B. Wrongful-Death and Estate Gate

Ala. Code § 6-5-410 assigns an Alabama wrongful-death action to the decedent's personal representative and supplies its own commencement, venue, damages, creditor, and distribution rules. If the Incident caused a death or the proposed settlement includes wrongful-death, survival, estate, probate, beneficiary, or allocation issues, stop and use a separately drafted and approved settlement package.

☐ No death resulted from the Incident and no estate or wrongful-death claim is included

☐ Death, estate, or beneficiary issue identified; this form will not be used without a separate reviewed package

C. Parties and Claims Matrix

Do not use “all affiliates,” “all persons,” “all insurers,” or similar expanding language unless every included category is understood, intended, and supported by the settlement consideration. Identify nonreleased tortfeasors, claims, policies, benefit rights, and contractual rights expressly.

2. AGREEMENT

This Personal-Injury Settlement Agreement and Release (the “Agreement”) is made on [__/__/____] by and between:

• Claimant: [FULL LEGAL NAME] (“Claimant”); and
• Paying Party: [FULL LEGAL NAME] (“Paying Party”).

The persons and entities identified in Schedule 1 as released parties are the “Released Parties.” No person or entity is released merely because it is not named as a party to this Agreement.

Recitals

A. An incident occurred on [__/__/____] at [LOCATION] (the “Incident”).

B. Claimant asserts the claims described in Schedule 1. The Released Parties deny liability and dispute [LIABILITY, CAUSATION, DAMAGES, OR OTHER ISSUES].

C. The parties wish to resolve only the claims and parties identified in this Agreement, without a trial or admission of liability.

For the consideration and promises stated below, the parties agree:

3. SETTLEMENT CONSIDERATION AND PAYMENT

3.1 Settlement Amount

Paying Party shall pay a total of $[________] (the “Settlement Amount”) through the following components:

No allocation in this table is a tax, lien, benefit, or court-approval determination. Each allocation must be separately reviewed before signing.

3.2 Delivery Conditions

Payment is due [____] days after Paying Party receives all of the following that actually apply:

☐ Agreement signed by every required person

☐ Current payment instructions and tax form requested by the payer

☐ Court approval and authority documents identified in Schedule 3

☐ Lien, reimbursement, or benefit documents identified in Schedule 2

☐ Dismissal documents held for filing under Section 7

☐ Other: [________________________________]

Payment shall be delivered to [TRUST ACCOUNT, CLAIMANT, COURT-RESTRICTED ACCOUNT, ANNUITY FUNDING ENTITY, OR OTHER APPROVED PAYEE] by [CHECK / WIRE / OTHER]. Payment is complete when [DEFINE CLEARED-FUNDS EVENT].

3.3 No Admission

This Agreement compromises disputed claims. Payment and execution are not admissions of fault, liability, causation, damages, coverage, or wrongdoing.

4. CLAIMANT'S RELEASE

Ala. Code § 8-1-23 provides that an obligation may be extinguished by a release given to the debtor upon new consideration or by a written release with or without new consideration. The scope of this release is governed by its actual words and schedules.

Upon the cleared-funds event in Section 3.2, Claimant releases the Released Parties from the claims described in Schedule 1 that:

1. Claimant owns and has authority to release;
2. Arise from the Incident; and
3. Are included within the selected release scope below.

Release Scope Election

Select one reviewed scope and delete the others:

☐ Identified-claims release: only the claims specifically listed as released in Schedule 1

☐ Incident-based release: all claims Claimant owns against the Released Parties arising from the Incident, whether currently known or unknown, except the reserved claims in Schedule 1

☐ Other negotiated scope: [________________________________]

This release does not include:

• Claims or parties expressly reserved in Schedule 1;
• Obligations created by this Agreement;
• Rights that Claimant lacks legal authority to release;
• Claims belonging independently to another person or entity; or
• [OTHER EXCLUSIONS].

Optional Reciprocal Release

☐ No reciprocal release is given.

☐ Upon the cleared-funds event, Paying Party releases Claimant only from the following identified Incident-related claims owned by Paying Party: [________________________________].

5. CLAIMANT REPRESENTATIONS

Claimant represents, as of signing, that:

1. Claimant has reviewed the Agreement and has had the opportunity to consult independent counsel;
2. Claimant signs voluntarily and has authority to release the selected claims;
3. Claimant has not assigned the released claims except as disclosed in Schedule 2;
4. Claimant has disclosed known pending cases, settlements, bankruptcy proceedings, benefit claims, assignments, and reimbursement demands that may affect payment or authority; and
5. Schedule 2 accurately identifies the known lien, reimbursement, and benefit issues reviewed for settlement administration.

These representations do not convert Claimant into an insurer of undiscovered third-party demands. Any reimbursement, holdback, direct-payment, cooperation, or indemnity obligation must be stated specifically in Schedule 2, with its scope, procedure, control of defense, settlement authority, documentation, and monetary treatment.

6. LIENS, REIMBURSEMENT, BENEFITS, AND DISTRIBUTION

The parties acknowledge that medical providers, health plans, government benefit programs, workers' compensation payers, insurers, attorneys, assignees, bankruptcy estates, or others may assert payment or reimbursement interests. This Agreement does not decide the validity, priority, amount, waiver, compromise, or satisfaction of any such interest.

Settlement Administration Election

☐ Claimant and counsel will hold $[________] in trust pending the documented resolution of the items in Schedule 2.

☐ Paying Party will issue separate payments described in Schedule 2.

☐ Court order or restricted deposit will control distribution under Schedule 3.

☐ Other reviewed procedure: [________________________________].

No party may represent that a lien or reimbursement interest is resolved unless the file contains the written basis for that conclusion.

7. PENDING ACTION AND DISMISSAL

If a lawsuit is pending:

1. The parties will sign the dismissal document described in Schedule 4;
2. [CLAIMANT'S COUNSEL / ESCROW AGENT] will hold it pending the cleared-funds event;
3. It will be filed within [____] business days after that event and any required court approval; and
4. The dismissal will state [WITH PREJUDICE / OTHER REVIEWED DISPOSITION], with costs allocated as follows: [________________________________].

No dismissal is required if no action is pending. This Agreement does not dismiss a case by itself.

8. OPTIONAL CONFIDENTIALITY AND COMMUNICATION TERMS

Select only terms supported by the negotiation and applicable duties. Delete this section if no restriction was part of the bargain.

☐ The Settlement Amount and nonpublic terms will be kept confidential, except for disclosures to counsel, tax advisers, financial advisers, insurers, reinsurers, auditors, regulators, courts, benefit programs, lien claimants, or others reasonably necessary to administer or enforce the settlement, and disclosures required by law, subpoena, court order, or professional duty.

☐ In response to outside inquiries, the parties will state only: [________________________________].

☐ No non-disparagement obligation applies.

☐ The following narrowly defined non-disparagement term applies: [________________________________].

Nothing in this section prohibits truthful testimony, legal process compliance, regulatory cooperation, benefit reporting, tax reporting, lien resolution, professional-responsibility compliance, or private communications with legal, financial, medical, or tax advisers.

9. BREACH AND ENFORCEMENT

If a party alleges breach, that party shall give written notice describing the breach and requested cure to [ADDRESS OR EMAIL]. Any cure period is [____] days, except when delay would defeat the purpose of the obligation or a court orders otherwise.

Available remedies are those supplied by this Agreement and applicable law. The parties do not agree to automatic rescission, automatic reinstatement of released claims, prevailing-party fees, a settlement-amount liability cap, no-bond injunctive relief, or indemnification unless a reviewed provision below states otherwise:

[INSERT SPECIFIC NEGOTIATED REMEDY, FEE, INTEREST, SECURITY, OR INDEMNITY TERM / NONE].

10. GENERAL TERMS

1. Governing law. Alabama law governs this Agreement, except to the extent another law necessarily controls a federal, benefit, lien, tax, bankruptcy, or other issue.
2. Forum. Any forum-selection term is: [________________________________ / None]. A pending court may retain authority as permitted by its orders and law.
3. Entire agreement. This Agreement and its schedules contain the complete settlement terms concerning the released claims.
4. Amendment. A change must be in a writing signed by the parties whose rights or duties are changed and must receive any required approval.
5. Severability. If a provision is unenforceable, the remaining terms continue only to the extent consistent with the settlement's material bargain and applicable law.
6. Counterparts and signatures. The parties may sign counterparts through the method they expressly accept: [WET INK / APPROVED ELECTRONIC PLATFORM / OTHER]. Any required court, fiduciary, insurer, or settlement-administration format remains controlling.
7. No drafting presumption. The Agreement reflects negotiation by the parties and counsel as applicable.
8. Headings. Headings assist organization and do not expand the release.

11. SIGNATURES

Claimant

• Name: [________________________________]
• Signature: [________________________________]
• Date: [__/__/____]

Claimant's Representative, if any

• Name and title: [________________________________]
• Authority: [________________________________]
• Signature: [________________________________]
• Date: [__/__/____]

Paying Party

• Name: [________________________________]
• Signatory and title: [________________________________]
• Signature: [________________________________]
• Date: [__/__/____]

Counsel Acknowledgment, if used

• Counsel for Claimant: [________________________________]
• Signature: [________________________________]

• Date: [__/__/____]

• Counsel for Paying Party: [________________________________]

• Signature: [________________________________]
• Date: [__/__/____]

SCHEDULE 1 — RELEASED PARTIES, CLAIMS, AND RESERVATIONS

SCHEDULE 2 — LIEN, REIMBURSEMENT, ASSIGNMENT, AND BENEFIT TRACKER

SCHEDULE 3 — CAPACITY, AUTHORITY, AND APPROVAL DOCUMENTS

SCHEDULE 4 — PAYMENT AND DISMISSAL CLOSING CHECKLIST

☐ Final Agreement signed

☐ Authority and approval conditions completed

☐ Payment instructions authenticated

☐ Settlement funds received and cleared

☐ Required direct payments and holdbacks funded

☐ Dismissal filed, if applicable

☐ Filed dismissal or closing order received

☐ Final distribution statement completed

☐ Settlement file retains supporting lien and authority documents

SOURCES AND REFERENCES

• Alabama Legislature — Ala. Code § 8-1-23
• Alabama Legislature — Ala. Code § 26-1-1
• Alabama Legislature — Ala. Code § 6-5-410