Collectibility: Is There a "Deep Pocket"?

When consulting with a new client about the possibility of bringing a lawsuit, this is always an important–and critical–question that must be addressed. It’s no secret that lawyers are expensive; so the question on everyone’s mind through case assessment is going to be: “How are we all going to get paid?”

Many factors are looked at, including, primarily, the strength of your case in terms of liability, as well as the full extent of your damages. But even if your case for liability and damage is fantastic, you still don’t have a case if you cannot hold a “deep pocket” responsible for paying on either a judgment or a settlement.

The “deep pocket” is often an insurance company. This is usually the case in most car crash lawsuits. After all, we’re all legally required to have auto insurance in order to drive a vehicle. Other lawsuit types that might implicate an insurance company include construction lawsuits, premises liability lawsuits, and even employment lawsuits. However, there are numerous other types lawsuits where insurance is far less likely to come into play.

Disputes between business owners or basic breach of contract lawsuits generally don’t involve insurance carriers. Typically, neither do defamation lawsuits (although some homeowner policies may cover this) or lawsuits regarding intentional torts like wrongful interference with contract or unfair and deceptive trade practices. Where this is the case, you and your lawyer must carefully assess whether the opposing party has the capability of paying a large settlement or judgment. This automatically rules out many ordinary, every-day folks.

On the other hand, some lawsuits may be worth pursuing, even if there is no large payout in damages at the end. For some, there may be a deeper, intrinsic value to standing by your work product in pursuing a collection, or in perhaps obtaining a declaration by the other party that they were wrong. Such lawsuits can prove expensive to pursue, and it’s up to the plaintiff to decide if they want to pour the time and resources into such a matter.

As you can see, there are a multitude of factors that must be carefully considered with every lawsuit that gets filed. The collectibility of damages is merely one. If you have a potential lawsuit on your hands, and need the experience and expertise of a seasoned litigator, you should give Asheville Legal a call today.