Settlement agreement
The contract by which insurer and claimant end their dispute through mutual concessions, and which closes the courts on the same subject.
France's judicial modernization act of November 18, 2016 rewrote article 2052 of the Civil Code. Gone is the force of a final judgment, a formula inherited from 1804: a settlement now bars bringing or continuing an action between the same parties with the same subject. Practitioners already knew that a settlement is challenged for defective consent, not on appeal. Article 2044 defines it as the contract by which the parties, through mutual concessions, end an existing dispute or forestall a future one. Those concessions are the condition of validity. If only one side gives ground, what remains is a unilateral waiver, which a court may set aside. Settlement is the normal way to close a contested claim. A discharge receipt, by contrast, records a payment with no prior dispute, and arbitration hands the decision to a third party instead of drawing it from agreement. The trickiest ground is bodily injury, where the claimant settles a future harm they cannot yet measure, which is why settlements in practice expressly reserve the case where the injury worsens.
Textbook case: water damage in a shop, joint expert appraisal closed in February 2025. The insurer offers 38,000 euros, the insured claims 52,000; on March 12 they sign a settlement at 45,000 euros, each side giving up part of its position. In September the insured finds mold behind a partition, ties it to the same loss and sues. Article 2052 bars the action: same parties, same subject. All that is left is to prove defective consent, fraud or mistake, not to argue that the figure was wrong. In bodily injury the same deed would have expressly reserved any worsening.
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