Why Structured Settlement Is a Good Alternative
Damages made by claimants can either be given in one lump sum, or in this case, structured payments. It is simply a better way to protect the interests of the aggrieved party, as well as ensure that the benefits he or she is entitled to are given in due time.
What makes structured settlement a good alternative
An alternative to the lump sum settlement, structured settlement, is ideal in many cases simply because not all offenses can be considered deliberate or intentional. The responsible party should not, in any way, be exempted from fulfilling his or her obligations to the aggrieved party, although in some circumstances, it is not always possible for one to pay upfront with a lump sum.
There are certain situations that require this scheme–damages caused by rather small businesses, for example. It is important for you to realize that these entities usually have barely enough financial resources to satisfy their own needs, let alone that of a petitioning party. A lump sum payment is not ideal in this case because instead of establishing a court-approved plan that will guarantee payment, you are simply taking away the possibility of claiming damages in full by severely disrupting the normal cash flow of the defendant’s business or personal finances. If this happens, you are simply giving them the chance to file for bankruptcy: a case that will only be to the detriment of both parties.
Having stated these facts, of course, it is also imperative that the structured settlement should still exert a substantial amount of financial pressure. This is the whole point of the penalty, after all. It simply has to be within reasonable limits or expectations. The question is: how will you define reasonable? In this case, only the court can make a justifiable assumption of the defendants financial health, following considerable research and multiple inquiries by a court-approved independent body.
The bottom line is that the concept of structured settlements is a system that upholds the right of both parties. While some would say it’s an unfair compromise, it is still a system that has proven to be effective, so much so that countries around the world have adopted this system for certain unique situations that require the flexibility afforded by the arrangement.
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