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SUIT VERSUS SETTLEMENT WHEN PARTIES SEEK NONMONETARY JUDGMENTS

NCJ Number
143586
Journal
Journal of Legal Studies Volume: 22 Issue: 1 Dated: (January 1993) Pages: 1-13
Author(s)
S Shavell
Date Published
1993
Length
13 pages
Annotation
This analysis of cases in which plaintiffs seek nonmonetary judgments such as child custody or an injunction concludes that the likelihood of settlement rather than trial and the nature of the settlement differ from those in cases in which plaintiffs seek purely monetary awards.
Abstract
Two situations are possible: those in which the judgment sought cannot be divided between the parties and those in which it can. If the judgment is indivisible, the parties' behavior can be simply expressed in terms of the amount of their maximum willingness to pay to obtain the outcome sought and the minimum acceptable for giving up the outcome. If the outcome is not divisible, a mutually beneficial settlement will exist regardless of the parties' willingness to pay and minimum acceptable demands. This theory can be tested empirically, because it implies that the frequency of trial increases as the cost of difficulty of dividing the outcome increases. Finally, the factor of risk aversion seems less significant in promoting settlement when judgments are nonmonetary than when they are monetary. Footnotes

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