Final answer:
The threat of an appeal, which can delay the resolution of a case, can be used as a bargaining chip by the defendant in settlement negotiations, potentially leading the plaintiff to settle for less favorable terms to avoid additional costs and delays.
Step-by-step explanation:
The possibility of appealing an adverse court decision introduces significant strategic considerations for bargaining in civil disputes. Since delays generally impose more costs on the plaintiff than the defendant, the defendant may use the threat of appealing as a bargaining chip during settlement negotiations. Knowing that an appeal can extend the time before a resolution is reached, thus increasing the plaintiff's costs, the plaintiff may be more inclined to settle for a lower amount or on less favorable terms to avoid the delay and expense of an ongoing legal battle. Conversely, if the plaintiff is aware that the defendant may not favor an appeal due to the potential for having to pay a higher amount later or because of interest group pressure, the plaintiff might push for a more favorable out-of-court settlement.
In summary, the threat of appeal and its resulting delay can significantly alter the dynamics of out-of-court settlements, potentially leading to outcomes that reflect the parties' relative aversion to incurring further delay and costs, rather than just the merits of the case itself.