PERSONAL INJURY SETTLEMENT AGREEMENT AND MUTUAL RELEASE
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TABLE OF CONTENTS
- Document Header.............................................................2
- Definitions..................................................................3
- Operative Provisions.........................................................5
3.1 Settlement Payment.......................................................5
3.2 Structured Settlement (Optional).........................................6
3.3 Conditions Precedent & Subsequent........................................7 - Representations & Warranties.................................................8
- Covenants & Restrictions....................................................9
- Default & Remedies..........................................................10
- Risk Allocation.............................................................11
- Dispute Resolution..........................................................12
- General Provisions..........................................................13
- Execution Block............................................................15
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1. DOCUMENT HEADER
1.1 Title. Personal Injury Settlement Agreement and Mutual Release (the “Agreement”).
1.2 Parties.
(a) Plaintiff/Claimant: [PLAINTIFF NAME], [individual / minor through Guardian ad Litem / estate representative] (“Claimant”).
(b) Defendant/Released Party: [DEFENDANT NAME], a [corporation / limited liability company / individual] (“Released Party”).
1.3 Effective Date. This Agreement is effective as of [EFFECTIVE DATE] (the “Effective Date”).
1.4 Recitals.
A. A dispute has arisen out of an alleged incident that occurred on or about [DATE OF INCIDENT] in [LOCATION] (the “Incident”).
B. Claimant alleges that the Incident caused personal injuries and other damages (the “Claims”), which Released Party denies.
C. The parties desire to resolve all matters arising from or related to the Incident, without admission of liability, under the terms set forth herein and in accordance with the laws of the State of Maine.
D. For 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. Terms defined in the singular include the plural and vice-versa.
“Agreement” means this Personal Injury Settlement Agreement and Mutual Release, as amended from time to time in accordance with Section 9.1.
“Claim(s)” has the meaning given in Recital B.
“Claimant” has the meaning given in Section 1.2(a).
“Confidential Information” means the terms, amount, and existence of this Agreement and all non-public information exchanged in connection with the settlement.
“Court Approval” means the approval required under applicable Maine law for settlements involving minors or legally incapacitated persons.
[// GUIDANCE: Maine law requires court approval of minor settlements that exceed statutory thresholds. Do not disburse funds to a minor without judicial authorization.]
“Effective Date” has the meaning given in Section 1.3.
“Incident” has the meaning given in Recital A.
“Released Party” has the meaning given in Section 1.2(b) and includes its past, present, and future parents, subsidiaries, affiliates, officers, directors, shareholders, employees, agents, insurers, reinsurers, attorneys, successors, and assigns.
“Settlement Amount” means the total gross sum of U.S. $[SETTLEMENT AMOUNT] referenced in Section 3.1.
“Structured Settlement” means a periodic-payment arrangement that satisfies Maine’s Structured Settlement Protection requirements, if elected under Section 3.2.
3. OPERATIVE PROVISIONS
3.1 Settlement Payment
3.1.1 Payment Obligation. Released Party shall pay Claimant the Settlement Amount within [NUMBER] business days after (i) full execution of this Agreement, (ii) delivery of a duly executed IRS Form W-9 by Claimant, and (iii) satisfaction of all Conditions Precedent in Section 3.3 (collectively, the “Payment Trigger”).
3.1.2 Form of Payment. Unless Structured Settlement is elected under Section 3.2, payment shall be made by [wire transfer / certified check] payable to “[LAW FIRM TRUST ACCOUNT] for the benefit of [PLAINTIFF NAME].”
3.1.3 Tax Characterization. The parties intend that the Settlement Amount represents damages for personal physical injuries or physical sickness within the meaning of Internal Revenue Code § 104(a)(2). Each party shall be responsible for its own tax reporting and liabilities.
[// GUIDANCE: Insert tax disclaimer language to mitigate professional-responsibility risk.]
3.2 Structured Settlement (Optional)
3.2.1 Election. At Claimant’s written option delivered on or before [DATE], all or part of the Settlement Amount may be paid through a Structured Settlement.
3.2.2 Requirements. Any Structured Settlement must:
(a) be funded by a qualified assignment company and annuity carrier licensed in Maine;
(b) comply with all Maine Structured Settlement Protection laws, including required disclosures and court approval of any subsequent sale or transfer; and
(c) name Claimant (or such other payee approved by the court, if applicable) as the annuitant and payee.
3.2.3 Release of Funding Obligation. Upon the qualified assignment of periodic-payment liability pursuant to 26 U.S.C. § 130, Released Party shall have no further obligation to make the periodic payments.
3.3 Conditions Precedent & Subsequent
(a) Execution of Dismissal. Claimant shall deliver to Released Party a duly executed [STIPULATION OF DISMISSAL WITH PREJUDICE] in the form attached as Exhibit A.
(b) Court Approval for Minors or Incapacitated Persons. If Claimant is a minor or otherwise lacks legal capacity, Court Approval is a condition precedent to any payment or release under this Agreement.
(c) Medicare Compliance. The parties shall reasonably cooperate to address Medicare Secondary Payer obligations, including conditional payment lien resolution, if applicable.
4. REPRESENTATIONS & WARRANTIES
4.1 Mutual Representations. Each party represents and warrants that:
(a) Capacity. It has full authority and capacity to execute, deliver, and perform this Agreement.
(b) No Transfer of Claims. It has not sold, assigned, or otherwise transferred any right or claim released herein.
(c) No Reliance. It enters into this Agreement based on its own investigation and not in reliance upon any representation or warranty by any other party except as expressly set forth herein.
4.2 Claimant-Specific.
(a) Liens. Claimant has disclosed all known medical liens, subrogation interests, and third-party claims arising from the Incident.
(b) Minor or Incapacitated Claimant. If applicable, the undersigned guardian, conservator, or next friend represents that he or she has full authority, subject to Court Approval, to enter into this Agreement on Claimant’s behalf and that the settlement is in the best interest of Claimant.
4.3 Survival. The representations and warranties in this Article 4 survive the Effective Date.
5. COVENANTS & RESTRICTIONS
5.1 No Future Claims. Except as expressly reserved herein, Claimant covenants not to initiate, assist, or maintain any proceeding arising out of or related to the Incident.
5.2 Confidentiality.
(a) Obligation. Claimant shall keep all Confidential Information strictly confidential and shall not disclose it except to the extent (i) required by law or court order, or (ii) necessary to enforce this Agreement.
(b) Liquidated Damages. A breach of this Section 5.2 shall entitle Released Party to liquidated damages of $[AMOUNT] per breach, not as a penalty but as a reasonable estimate of damages.
[// GUIDANCE: Maine recognizes liquidated-damages clauses if the amount is a reasonable forecast and actual damages are difficult to ascertain.]
5.3 Non-Disparagement. The parties agree not to make any false or disparaging statements regarding one another in connection with the Incident.
6. DEFAULT & REMEDIES
6.1 Events of Default.
(a) Payment Default. Failure of Released Party to make the Settlement Payment when due.
(b) Confidentiality Default. Any material breach of Section 5.2.
6.2 Notice & Cure. The non-defaulting party shall give written notice specifying the default. The defaulting party has ten (10) days to cure a Payment Default and five (5) days to cure any other default.
6.3 Remedies.
(a) Specific Performance. The parties acknowledge that monetary damages may be inadequate and agree that non-defaulting parties may seek specific performance.
(b) Reinstatement of Claims. If Released Party fails to cure a Payment Default, Claimant may elect to reinstate the Claims, crediting any partial payments against any judgment obtained.
(c) Attorneys’ Fees. The prevailing party in any action to enforce this Agreement is entitled to reasonable attorneys’ fees and costs.
7. RISK ALLOCATION
7.1 Mutual Release.
(a) Scope. Effective upon receipt of the Settlement Amount, Claimant irrevocably and unconditionally releases and forever discharges Released Party from any and all claims, demands, causes of action, liens, or liabilities, whether known or unknown, suspected or unsuspected, arising out of or related to the Incident, including future complications.
(b) Reciprocal Release. Released Party releases Claimant from any and all claims arising out of the Incident.
(c) Exclusions. This release does not apply to obligations created by this Agreement or to any rights that cannot be released by law.
7.2 Indemnification. Each party shall indemnify, defend, and hold harmless the other from any claims or liens asserted by any third party (including Medicare, Medicaid, ERISA plans, and healthcare providers) arising from payments made or obligations incurred in connection with the Incident.
7.3 Limitation of Liability. The Settlement Amount constitutes the sole and exclusive liability of Released Party for the Claims.
7.4 Force Majeure. No party shall be liable for delay or failure in performance caused by events beyond its reasonable control (e.g., natural disasters, governmental actions, or acts of terrorism); provided, however, that financial inability does not constitute force majeure.
8. DISPUTE RESOLUTION
8.1 Governing Law. This Agreement is governed by, and construed in accordance with, the laws of the State of Maine, without regard to conflict-of-laws principles.
8.2 Forum Selection. The state courts located in [COUNTY], Maine shall have exclusive jurisdiction over any dispute arising out of or related to this Agreement. Each party irrevocably submits to such courts and waives any objection based on forum non conveniens.
8.3 Arbitration. Not applicable.
8.4 Jury Waiver. Not applicable.
9. GENERAL PROVISIONS
9.1 Amendment & Waiver. This Agreement may be amended only by a written instrument signed by all parties. No waiver of any provision is effective unless in writing and signed by the party against whom enforcement is sought.
9.2 Assignment. No party may assign or delegate this Agreement, in whole or in part, without the prior written consent of the other party, except that Released Party may assign to an insurer or qualified assignment company for Structured Settlement purposes.
9.3 Successors & Assigns. This Agreement binds and benefits the parties and their respective successors, assigns, heirs, and personal representatives.
9.4 Severability. If any provision is held invalid or unenforceable, the remaining provisions remain in full force. The invalid provision shall be reformed to the minimum extent necessary to render it valid and enforceable.
9.5 Integration. This Agreement, including any exhibits, constitutes the entire agreement between the parties regarding the subject matter and supersedes all prior negotiations and understandings.
9.6 Counterparts. This Agreement may be executed in multiple counterparts, each of which is deemed an original and all of which together constitute one instrument.
9.7 Electronic Signatures. Signatures transmitted by facsimile, PDF, or secure electronic signature platform (e.g., DocuSign) are deemed original for all purposes.
9.8 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.
plaintext
CLAIMANT / PLAINTIFF
[PLAINTIFF NAME]
Signature: ______
Name: _____
Date: _____
[IF MINOR OR INCAPACITATED PERSON:]
[NAME], as Parent / Guardian ad Litem / Conservator
Signature: ______
Date: _____
RELEASED PARTY / DEFENDANT
[DEFENDANT NAME]
By: _______
Name: _____
Title: ______
Date: _________
[// GUIDANCE: Insert notary acknowledgment or witness signatures if required under Maine law, particularly for minor settlements or structured-settlement documents.]
Exhibit A
Form of Stipulation of Dismissal With Prejudice
[Attach standard one-page dismissal form compliant with Maine Rule of Civil Procedure 41(a).]
[// GUIDANCE: Remember to file the dismissal only after payment clears or upon mutually agreed escrow instructions.]