The Offer of Judgment rule is a United States tort reform law aimed at controlling unnecessary litigation and at encouraging settlement. Under this rule, if a settlement offer designated as an offer of judgment is made in civil litigation, the offer is rejected and the final court decision is less favorable than the final offer that was made, then the party who rejected the offer is subject to certain penalties. The same principle can be found in the Calderbank offer jurisprudence in England.
Tort reform refers to proposed changes in the civil justice system that aim to reduce the ability of victims to bring tort litigation or to reduce damages they can receive.
A settlement offer or offer to settle is an offer to resolve an outstanding issue or account. This may involve a statutory offer to compromise in a civil lawsuit. In either case, it involves communication from one party to the other suggesting a settlement, or an agreement to fully and finally resolve the outstanding issue, account, or dispute.
The penalties vary by state, but often include some combination of an award to the other party of certain attorneys' fees, compensable litigation costs and prejudgment interest. Most jurisdictions limit these awards to fees, costs and interest accumulated after the offer is made or rejected. In addition, the party who rejected the offer may lose their entitlement to certain attorneys' fees, compensable litigation costs and prejudgment interest. Here again, most jurisdictions provide that the party who rejected the offer loses no more than their entitlement to the attorneys' fees, costs and interest incurred after the making or rejection of the settlement offer.
The rule is not applicable in divorce proceedings or child custody proceedings.
This rule was first introduced in a number of states in the late 19th and early 20th centuries, subsequently adopted in 1938 in the Federal Rules of Civil Procedure, and is currently designated as Rule 68 of the Federal Rules of Civil Procedure. Many states have modified the rule by varying degrees. A survey of state Offer of Judgement Provisions has been compiled by the American College of Trial Lawyers and indicates the use by each state. In the U.S. state of Maryland the rule is only applicable to medical malpractice cases.
The Federal Rules of Civil Procedure govern civil procedure in United States district courts. The FRCP are promulgated by the United States Supreme Court pursuant to the Rules Enabling Act, and then the United States Congress has seven months to veto the rules promulgated or they become part of the FRCP. The Court's modifications to the rules are usually based upon recommendations from the Judicial Conference of the United States, the federal judiciary's internal policy-making body. Although federal courts are required to apply the substantive law of the states as rules of decision in cases where state law is in question, the federal courts almost always use the FRCP as their rules of civil procedure.
In the United States, a state is a constituent political entity, of which there are currently 50. Bound together in a political union, each state holds governmental jurisdiction over a separate and defined geographic territory and shares its sovereignty with the federal government. Due to this shared sovereignty, Americans are citizens both of the federal republic and of the state in which they reside. State citizenship and residency are flexible, and no government approval is required to move between states, except for persons restricted by certain types of court orders. Four states use the term commonwealth rather than state in their full official names.
Medical malpractice is a legal cause of action that occurs when a medical or health care professional deviates from standards in his or her profession, thereby causing injury to a patient.
This rule became law in the U.S. state of Georgia on 27 April 2006. In Georgia, the threshold was set such that the final court decision must be no more than 25% less favorable than the last settlement offer or the rejector becomes liable for attorney fees. However, the Georgia Supreme Court struck the statute down in 2007, on the ground that it purported to act retroactively and was therefore unconstitutional. [1] A new version of the statute survived subsequent challenge and is now law. [2]
Georgia is a state in the Southeastern United States. It began as a British colony in 1733, the last and southernmost of the original Thirteen Colonies to be established. Named after King George II of Great Britain, the Province of Georgia covered the area from South Carolina south to Spanish Florida and west to French Louisiana at the Mississippi River. Georgia was the fourth state to ratify the United States Constitution, on January 2, 1788. In 1802–1804, western Georgia was split to the Mississippi Territory, which later split to form Alabama with part of former West Florida in 1819. Georgia declared its secession from the Union on January 19, 1861, and was one of the original seven Confederate states. It was the last state to be restored to the Union, on July 15, 1870. Georgia is the 24th largest and the 8th most populous of the 50 United States. From 2007 to 2008, 14 of Georgia's counties ranked among the nation's 100 fastest-growing, second only to Texas. Georgia is known as the Peach State and the Empire State of the South. Atlanta, the state's capital and most populous city, has been named a global city. Atlanta's metropolitan area contains about 55% of the population of the entire state.
The Nevada Supreme Court's 1998 adoption of a replacement offer of judgment rule in NRCP 68 introduced a tremendous degree of flexibility to parties that choose to serve offers of judgment. This high degree of flexibility is unique to Nevada, and it has greatly complicated Nevada's offer of judgment law. In departing from prior law and from the practice in every other state, the 1998 Rule allows for the following: unapportioned offers of judgment may be served to multiple parties under limited circumstances; any unrelated parties may serve an unapportioned offer to any party; a party may draft an offer for a lump sum or for an amount that includes any combination of costs, attorneys' fees and interest; a party may draft an offer that apportions the offered amounts by claim; a party (or multiple parties) may serve an apportioned offer to multiple parties that includes a condition that it be accepted by all parties; and a party may proceed to trial but shield itself from offer of judgment penalties by "accepting" an apportioned offer of judgment that is conditioned by the acceptance of all parties where all parties do not accept.
