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Checklist: what to check before signing a settlement agreement

2 min read · Editorial oversight: Avv. Federico Papa

This checklist is intended for legal professionals immediately prior to signing or exchanging the settlement agreement. Its purpose is to verify compliance with the validity requirements set forth in Articles 1965 and 1966 of the Civil Code and adherence to the written form requirement under Art. 1967 c.c.

In brief

Reviewing a settlement agreement under Art. 1965 c.c. requires verifying the validity requirements set forth in Articles 1965 and 1966 c.c., as well as compliance with the written form under Art. 1967 c.c. The agreement must include reciprocal concessions to prevent reclassification as a unilateral waiver or acknowledgment of debt. Signatories must possess full capacity to dispose of rights, and the agreement must not involve non-disposable rights or mandatory provisions, under penalty of absolute nullity. Written form is required ad substantiam for real property rights pursuant to Art. 1350 c.c.

1.
Verify the reciprocity of concessions
Verify that the agreement provides for reciprocal concessions from both parties as required by Art. 1965 c.c. In the absence of reciprocity, the agreement may be reclassified as a mere unilateral waiver or an acknowledgment of debt.
Related practical guide: How to draft a settlement agreement under Art. 1965 c.c. with AI
2.
Verify the availability of rights
Ensure that the subject matter of the dispute does not involve non-disposable rights pursuant to Art. 1966 c.c. A settlement agreement concerning rights arising from family relationships or mandatory rules is subject to absolute nullity.
3.
Check the written form requirement
Verify that the agreement is executed in writing if it concerns real property rights under Articles 1350 and 1967 c.c. Lack of written form ad substantiam renders the settlement null and void.
4.
Define the object of the dispute clearly
Ensure that the recitals clearly define the dispute that the parties intend to settle. Indeterminacy of the subject matter prevents defining the exact scope of the agreement's preclusive effect.
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5.
Verify the capacity to dispose of rights
Ensure that the signatories possess full capacity to dispose of the rights covered by the settlement, as prescribed by Art. 1966 c.c. Lack of such capacity renders the agreement invalid.
6.
Check certainty of amounts and deadlines
Verify the mathematical accuracy of the amounts and the precise specification of performance deadlines. Ambiguity regarding sums or dates may generate new disputes during execution.
7.
Check consistency between recitals and clauses
Verify that the operative clauses address all claims set out in the recitals. This ensures that the settlement operates effectively under Art. 1965 c.c. to prevent future litigation.
8.
Verify the completeness of signatures
Ensure that all named parties have signed at the end of the document. Execution by signature is required to finalize the agreement, without prejudice to the requirement of a public deed or authenticated private agreement for the transcription of real estate settlements.

Editorial oversight: Avv. Federico Papa·ICAMContent drafted with AI support and subject to editorial source checks. Despite these controls, inaccuracies may remain: reports and rectification requests are welcome. Report a correction

Frequently asked questions

What happens if the settlement does not provide for concessions from both sides?

In the absence of reciprocal concessions, the contract does not qualify as a settlement under Art. 1965 c.c. and may be reclassified as a unilateral waiver or acknowledgment of debt, thereby forfeiting the typical legal effects of a settlement agreement.

Is it possible to settle a non-disposable right?

No, Art. 1966 c.c. provides that a settlement is null and void if the rights subject to the dispute are beyond the parties' power of disposal by law or by their intrinsic nature.