PERSONAL INJURY SETTLEMENT AGREEMENT
(Mutual Release of All Claims)
State of Kentucky
[// GUIDANCE: This template is drafted for use in settling Kentucky tort claims. Customize all bracketed items, delete inapplicable optional provisions, and attach referenced exhibits (e.g., lien summaries, structured-payment schedules).]
TABLE OF CONTENTS
- Document Header
- Definitions
- Operative Provisions
3.1 Settlement Consideration
3.2 Conditions Precedent & Subsequent - Representations & Warranties
- Covenants & Restrictions
- Default & Remedies
- Risk Allocation
7.1 Mutual Indemnification & Release
7.2 Limitation of Liability - Dispute Resolution
- General Provisions
- Execution Block
1. DOCUMENT HEADER
Settlement Agreement and Mutual Release (this “Agreement”) made and entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and between:
- [CLAIMANT LEGAL NAME], an individual [or entity] (“Claimant”); and
- [DEFENDANT LEGAL NAME], a [state] [entity type] (“Defendant”).
Each a “Party” and, collectively, the “Parties.”
1.1 Recitals
A. Claimant alleges that on or about [DATE OF INCIDENT] at [LOCATION] Claimant sustained personal injuries and other damages (the “Incident”).
B. Claimant has asserted or may assert claims against Defendant arising out of the Incident (collectively, the “Claims”).
C. Defendant denies liability but desires to avoid the cost and uncertainty of litigation.
D. The Parties now wish to fully and finally settle all Claims upon the terms set forth herein, intending this Agreement to be a release enforceable under Kentucky law.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are acknowledged, the Parties agree as follows:
2. DEFINITIONS
For purposes of this Agreement, the following capitalized terms have the meanings set forth below. Undefined capitalized terms have the meanings given in context.
“Agreement” – this Personal Injury Settlement Agreement and all attached exhibits.
“Approval Order” – an order of a Kentucky District or Circuit Court approving this Agreement pursuant to KRS 387.280 (minor) or other applicable authority.
“Claims” – all past, present, and future claims, demands, actions, causes of action, rights, damages, costs, expenses, and compensation of every nature, whether known or unknown, suspected or unsuspected, arising from or relating to the Incident.
“Liens” – any Medicare, Medicaid, ERISA, workers’ compensation, hospital, or other statutory or contractual liens related to the Incident.
“Releasees” – Defendant and its past, present, and future parents, subsidiaries, affiliates, insurers, reinsurers, officers, directors, employees, agents, successors, and assigns.
“Settlement Amount” – the total consideration described in Section 3.1.
“Structured Payments” – periodic payments, if any, to be made in accordance with Section 3.1(b).
3. OPERATIVE PROVISIONS
3.1 Settlement Consideration
(a) Lump-Sum Payment. Defendant shall pay Claimant [SETTLEMENT AMOUNT (in words and figures)] on or before [PAYMENT DATE] by [wire / check] payable to [PAYEE].
(b) Optional Structured Settlement. In lieu of, or in addition to, the lump-sum payment, the Parties may agree to the Structured Payments outlined on Exhibit A. Any structured settlement shall comply with:
(i) Internal Revenue Code §104; and
(ii) Kentucky Structured Settlement Protection Act, KRS 454.430 et seq. (solely to the extent court approval of any future factoring is sought).
[// GUIDANCE: Delete subsection (b) if there is no structured component.]
3.2 Conditions Precedent & Subsequent
(a) Minor Approval (if Claimant is a minor). This Agreement is contingent upon entry of an Approval Order under KRS 387.280.
(b) Lien Resolution. Claimant shall deliver to Defendant satisfactory proof of final lien resolution within [___] days of Effective Date; failure is an Event of Default (Section 6).
(c) Dismissal of Litigation. Within five (5) business days after receipt of the Settlement Amount, Claimant shall file a dismissal with prejudice of [COURT/CASE NO.].
4. REPRESENTATIONS & WARRANTIES
4.1 Mutual Authority. Each Party has full power and authority to enter into and perform this Agreement.
4.2 Claimant Reps. Claimant represents that:
(a) Claimant is the sole owner of the Claims;
(b) no assignment of the Claims or Liens exists other than those disclosed in Schedule 1;
(c) Claimant has had an opportunity to consult independent counsel and tax advisers;
(d) if Claimant is a minor or legally incapacitated, a duly appointed guardian ad litem or next friend has executed this Agreement subject to court approval.
4.3 Defendant Reps. Defendant represents that the execution and delivery of this Agreement have been duly authorized.
4.4 Survival. The representations and warranties survive the Effective Date and payment of the Settlement Amount.
5. COVENANTS & RESTRICTIONS
5.1 No Future Claims. Claimant covenants not to sue Releasees for any Claims released herein.
5.2 Non-Disparagement. Each Party shall refrain from making knowingly false or defamatory statements about the other concerning the Incident.
5.3 Confidentiality (Optional). The terms of this Agreement are confidential except: (i) as required by law or court order; (ii) to professional advisers; or (iii) for tax filings.
[// GUIDANCE: Kentucky generally enforces confidentiality clauses; ensure carve-outs for truthful testimony.]
6. DEFAULT & REMEDIES
6.1 Events of Default.
(a) Defendant’s failure to timely fund the Settlement Amount.
(b) Claimant’s material breach of Section 5 or failure to obtain an Approval Order (if required) within [___] days.
6.2 Cure Period. The non-defaulting Party shall give written notice; the defaulting Party has ten (10) days to cure.
6.3 Remedies. If uncured:
(a) Defendant Default – Claimant may reinstate litigation, recover the Settlement Amount plus interest at [___]% per annum, and reasonable attorneys’ fees.
(b) Claimant Default – Defendant may withhold unpaid Settlement Amounts and seek reimbursement of amounts previously paid, plus fees and costs.
7. RISK ALLOCATION
7.1 Mutual Indemnification & Release
(a) Claimant, on behalf of Claimant and Claimant’s heirs, fully and forever releases and discharges the Releasees from all Claims.
(b) Defendant releases Claimant from any claims arising out of the filing or prosecution of the Claims.
(c) Each Party shall indemnify, defend, and hold harmless the other from any loss arising from breach of this Agreement or inaccuracy of its representations.
7.2 Limitation of Liability
The liability of either Party for breach of this Agreement shall not exceed the Settlement Amount actually paid or payable, except for (i) claims for specific performance; (ii) indemnity obligations under Section 7.1(c); or (iii) fraud or willful misconduct.
7.3 Medicare/Medicaid Compliance
Claimant affirms that Claimant has satisfied or will satisfy any conditional payments pursuant to 42 U.S.C. §1395y(b). Claimant shall be solely responsible for any Medicare penalties, fines, or reimbursement obligations.
8. DISPUTE RESOLUTION
8.1 Governing Law. This Agreement shall be governed by the substantive law of the Commonwealth of Kentucky without regard to conflict-of-laws principles.
8.2 Forum Selection. The Parties consent to the exclusive jurisdiction of the Kentucky state courts sitting in [COUNTY] County, Kentucky, for any dispute arising under this Agreement.
8.3 Arbitration; Jury Waiver; Injunctive Relief. The Parties expressly agree no arbitration clause, jury waiver, or injunctive relief provision applies unless added by written amendment.
9. GENERAL PROVISIONS
9.1 Entire Agreement. This Agreement constitutes the entire agreement among the Parties and supersedes all prior negotiations.
9.2 Amendment & Waiver. No amendment or waiver is effective unless in writing signed by both Parties. A waiver on one occasion is not a waiver on any future occasion.
9.3 Assignment. Neither Party may assign its rights or delegate its duties without the prior written consent of the other, except that Defendant may assign to its insurers.
9.4 Successors & Assigns. This Agreement binds and benefits the Parties and their respective successors and assigns permitted herein.
9.5 Severability. If any provision is held invalid, the remaining provisions remain in full force, and the invalid provision shall be reformed to the minimum extent necessary.
9.6 Counterparts; Electronic Signatures. This Agreement may be executed in multiple counterparts, each deemed an original. Electronic signatures and pdf copies are as enforceable as originals under Ky. Rev. Stat. Ann. §369.102.
9.7 Headings. Headings are for convenience only and do not affect interpretation.
10. EXECUTION BLOCK
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.
| CLAIMANT | DEFENDANT |
|---|---|
| Signature: ______ | Signature: ______ |
| Name: [CLAIMANT NAME] | Name: [AUTHORIZED SIGNATORY] |
| Title (if entity): ____ | Title: _____ |
| Date: _____ | Date: _____ |
[Optional Notary Acknowledgments per KRS 423.110]
EXHIBIT A
Structured Payment Schedule
[// GUIDANCE: List annuity issuer, payment dates, amounts, and beneficiary designation. Specify that the annuity will comply with KRS 454.430 et seq. if later transferred.]
SCHEDULE 1
Lien Disclosure & Resolution Plan
[// GUIDANCE:
1. MINOR SETTLEMENT CHECKLIST (if applicable):
• File petition for Approval Order in the appropriate Kentucky District Court (KRS 387.280).
• Attach this executed Agreement, medical reports, bills, and affidavit of guardian ad litem.
• Ensure proceeds >$5,000 are placed in a restricted account or structured per court directive.
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RELEASE ENFORCEABILITY: Kentucky enforces broad releases when the language is clear and unequivocal. This template expressly releases unknown claims, includes mutual consideration, and is supported by separate recitals to enhance enforceability.
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TAX DISCLAIMER: Personal injury recoveries for physical injuries are generally excludable from gross income under IRC §104(a)(2); however, punitive damages, if any, are taxable. Claimant should seek independent tax advice.]