Mid Mountains Legal Blog

What is an Offer to Settle?

Anthony Steel

An offer to settle is a remedy available to both parties to end a case without going to trial. The parties agree to settle the case without or with less participation of the Federal Circuit and Family Court of Australia (the court). The goal is to ensure that each family law case is resolved in a timely manner at a reasonable cost.

The court does not usually participate in the process of making an offer and counter-offer. The parties are encouraged at all times to make an offer to settle in an effort to resolve a case.

Generally, an offer for settlement is not compulsory. The parties may disregard this remedy and may choose to go directly to the trial. The court will not order a party to a case to make an offer to settle or a counter-offer. Although this process is not compulsory, the parties are encouraged to take advantage of this process to save costs and avoid stressful, time consuming and costly court proceedings.

Why make offers to settle?

Offers to settle will avoid you having to spend more money on your case and will save you from engaging in a legal battle.

How do I make an offer?

An offer to settle all or part of a case must be in writing and must not be filed in court.

When can I make offers to settle?

A party may make an offer to settle all or part of a case at any time before the court makes an order disposing of the case or at any time during an appeal.

When can I accept an offer to settle?

You can accept offer to an offer to settle at any time before the other party withdraws it or before the court renders judgment in the case.

Can a party withdraw the offer?

If the offer to settle is not compulsory, a party may withdraw an offer by giving the other party a written notice that the offer is withdrawn. If it is compulsory, a party cannot withdraw it unless he or she makes another genuine offer to settle.

Compulsory offers to settle

In property and parenting cases, a prospective party to a case must make an offer to settle before going to court in order to comply with the pre-action procedures.

1.    Financial cases

If:

  • no dispute resolution service is available
  • a party refuses or fails to participate, or
  • agreement is not reached through dispute resolution, a party considering applying to a court must give the other party written notice of the intention to start a proceeding (a notice of intention), setting out:
    • the issues in dispute
    • the orders to be sought if a case is started
    • a genuine offer to resolve the issues, and
    • a nominated time (at least 14 days after the date of the letter) within which the other person must reply.

2.    Parenting cases

A person considering applying to the court must give the other party a notice of intention, setting out:

  • the issues in dispute;
  • the orders to be sought if a case is started;
  • a genuine offer to resolve the issues, and
  • a nominated time (at least 14 days after the date of the letter) within which the other party must reply.

The court will not hear the case if the pre-action procedures are not followed. A party who has not followed the pre-action procedures may suffer serious consequences, including cost penalties.

Counter offer

The aim of making a counter-offer is to get a win-win situation. A party will most likely accept an offer only if he or she is satisfied with the offer. If the offer is not satisfactory, the other party may make a counter-offer, which may be entirely different from the original offer or an enhancement of it. Making a counter-offer does not in itself prohibit the maker from accepting the original offer.

What does “Without Prejudice” mean?

An offer to settle is not acceptable as evidence in court if it is related to the case and is a genuine offer. Otherwise, it may be used against the party who made the offer. The header “without prejudice” is intended to give the offeror the freedom to stipulate the terms and conditions of the proposed settlement without fear that the offer can later be used against the offeror as evidence in court.

What now?

Contact us to advise and assist you in making an offer to settle.

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