Is it better to reach an agreement or go to court?

Question

José Manuel Alburquerque · Accepted Answer

It depends on the case. An agreement gives certainty and speed, costs less and lets the parties decide the outcome, for example payment in instalments. Court proceedings can give you everything you ask for or nothing, usually take longer and cost more and, even if you win, you may not recover all your expenses or ever get paid. Going to court makes sense above all when what you are being offered is a long way from what you would probably obtain or when the other side is not negotiating in good faith. To decide, compare the offer with a realistic estimate of what you would get in court, after deducting the cost, the time and the risk of losing. What weighs in favour of an agreement An agreement is often more advantageous than it seems, even for those who believe they are in the right. These are its advantages: Certainty. The parties know from day one what they will pay or receive, without depending on how the judge assesses the evidence. Time. A court case can last months or years, longer if there are appeals. An agreement can be concluded in weeks. Cost. Each party pays its own lawyer, court agent (“procurador”) and experts. A party that wins outright usually recovers its costs from the other side, but subject to a cap and without the costs always covering everything spent. Getting paid. A favourable judgment is of little use if the debtor has no assets. An agreement the debtor can keep, for example with payments in instalments, sometimes makes payment more certain. Discretion and relationships. What is discussed in order to reach an agreement is confidential, whereas a trial is public. An agreement also makes it easier to keep dealing with the other side, which matters between business partners, neighbours or relatives. When going to court may be better An agreement is not always the best way out. Going to court may be better in cases such as these: If the offer is well below what you are likely to obtain with the evidence you have. If the other side is only playing for time or does not keep its promises. If the matter raises an issue that is best decided by a judge, for example because it will come up again in other cases. If you are being asked to pay something you do not owe and you can prove it. Going to court does not close the door to an agreement either. The parties can reach an agreement at any stage of the proceedings, even on the day of the trial. If they do, they can ask the judge to approve the agreement. How to decide Before deciding, ask your lawyer for a frank assessment of the chances of success, of what the case will cost and of how long it will take. With it you will be able to compare the offer with what you could reasonably expect to obtain. Bear in mind too that the law generally requires an attempt to reach an agreement before a claim is brought. Since 2025, refusing to negotiate without good reason can prove expensive when it comes to costs, even for the party that wins the case. If you reach an agreement, put it in writing in full detail, including what happens if it is not honoured and who pays the expenses. If it is signed as a public deed before a notary, it can be enforced in court without a prior trial.