OCR Settlement Agreement Scans: Payments, Releases, Dates

To OCR a settlement agreement scan, read its confidentiality clause first, then convert the agreement and each exhibit as separate files. Search the text for the payment terms, the release and every deadline, and read each amount, date and party name against the page image before it goes into a payment tracker or a calendar.

What makes a scanned settlement agreement unlike a commercial contract?

A settlement agreement ends a dispute, and its pages show it. The scan may open with a case caption, name the lawsuit and its number, carry signatures from the parties and from their lawyers, attach court forms as exhibits, and bear a court's stamp if a copy was filed. Those marks set it apart from a commercial contract.

Each feature changes something about conversion.

Two points about origin help you read the scan.

Where it was signed. An agreement signed at the end of a mediation may be a short typed or handwritten term sheet, with a longer document to follow. Check whether your file has one or both, and which the parties called final.

Whether it was filed. A copy from the court's docket may carry a filing header or stamp that a copy from the client's or counsel's file lacks. They may differ in other ways too, such as redactions, so note which one you hold.

If the pages came out of a mediation, keep the term sheet and the later settlement agreement as separate scans. Write down any settlement demand you see in a cover note, with the amount and the date beside it. Where the payment language is titled accord and satisfaction, quote that heading and the page number. Alternative dispute resolution papers in the same folder belong on your list before you convert.

Roles deserve a short list before you convert anything. In a fictional dispute, Dellwyn Marsh sued Harrowgate Logistics, Inc. and its manager Peter Aldous. The agreement calls Marsh "Plaintiff" and "Releasor", calls the other two "Defendants", and then defines "Released Parties" to include more people than the two defendants. Write those definitions down first. Every later search depends on them.

Finding the payment schedule and default terms in a settlement scan

The payment terms sit in a section with a heading such as "Settlement Payment" or "Consideration", and the default terms may be in the same section or pages away. Search the converted text for the money words and the failure words separately, then join what you find in one table with page references.

Searches for the payment side:

• "pay", "payment", "sum of", "amount of", and the dollar sign;
• "installment", "lump sum", "within", "on or before";
• "payable to", "wire", "check", "trust account";
• "tax", "Form 1099", "W-9", "allocation".

Searches for the default side:

• "default", "fail", "failure to pay", "breach";
• "cure", "notice", "days after";
• "accelerate", "entire remaining balance", "immediately due";
• "interest", "attorneys' fees", "judgment", "stipulated", "consent".

Take the Marsh settlement. Its payment section reads, in part:

Defendants shall pay Plaintiff the total sum of Eighty-Four Thousand Dollars ($84,000.00) as follows: (a) Twenty-Four Thousand Dollars ($24,000.00) within fourteen (14) days after the Effective Date; and (b) twelve (12) consecutive monthly installments of Five Thousand Dollars ($5,000.00), each due on the first day of the month, beginning February 1, 2027.

Laid out as terms:

Then run the arithmetic the document allows:

1. Words against figures. Each amount is stated twice. Both forms should agree in the image and in the converted text.
2. Parts against the total. $24,000 plus twelve times $5,000 is $84,000. If the sum fails, a digit or the number of installments was misread, or the agreement has an error to report.
3. Count of installments against the dates. Twelve monthly payments from 1 February 2027 end on 1 January 2028.
4. "Effective Date" against its definition. The first payment runs from a defined date. Find the definition, which may depend on the last signature or on a court's approval.

Recognized text does not mark a doubtful digit, so these checks and a read of the image are the control. How digits get misread is explained in the post on why OCR gets numbers wrong.

Where does a scanned settlement agreement say who is released?

Look in three places: the definitions or opening paragraph, where the parties and any "Released Parties" or "Releasors" are defined; the release section itself; and any carve-out saying what is not released. The answer is assembled from all three, and the definitions may reach further than the names in the caption.

Search terms that find the release and its parts:

In the Marsh agreement the pieces are in three places:

1.4 "Released Parties" means Defendants and each of their respective parents, subsidiaries, affiliates, insurers, officers, directors, employees and agents.

5.1 Plaintiff, on behalf of himself and his heirs and assigns, releases the Released Parties from all claims arising out of or relating to the Action or Plaintiff's employment with Harrowgate.

5.3 Nothing in this Section 5 releases any claim to enforce this Agreement or any claim that cannot be released as a matter of law.

A reader who found only 5.1 would not know that insurers are covered, and would miss the carve-out in 5.3.

Why the release needs a word-for-word read

A release is a long sentence built from lists. Recognition can drop a line of it, and the sentence will still read as grammatical because one item in a list of fifteen is missing. Small words decide scope: "and" against "or", "arising out of" against "arising out of or relating to", "known" against "known or unknown". Read the release and the definitions it uses against the image, line by line, and count the lines.

Then record, without interpreting:

• each releasor as named, and each extension such as heirs or assigns;
• each released party as named, and each category added by definition;
• the description of the claims, quoted;
• each exception, quoted;
• whether the release runs one way or both ways, according to the headings and the text;
• any statute the agreement cites in a waiver, by its section number as printed.

What the release covers in law is the lawyer's question. A quoted, page-referenced extract is what lets them answer it without rereading the scan.

A firm that settles the same kind of case repeatedly may want to keep release wording for later matters. Do that from proofread text and with the parties' details removed, as described in the post on building a contract clause library.

Converting a settlement agreement that carries court stamps and exhibits

Split the scan into the agreement and each exhibit, convert each as its own file, and treat any court stamp or filing header as separate information to record, not as part of the agreement's text. Exhibits such as a stipulated judgment or a dismissal form are court documents with their own layouts.

1. Read the confidentiality clause before uploading anything. If the clause restricts who may hold copies, get the responsible lawyer's decision before going further.
2. Save the scan as received and note its source: the court's docket, opposing counsel, the client or your own scanner.
3. List the parts from the page images. The agreement, each lettered exhibit, signature pages and any counterparts.
4. Check that every exhibit the agreement cites is attached. Search the text for "Exhibit" after conversion and compare with your list.
5. Split and name the parts so they sort in order: agreement, Exhibit A, Exhibit B.
6. Convert each part. A searchable PDF serves as the record copy. Word or plain text serves for quoting.
7. Record the stamps. For a filed copy, note the court, the filing date and any document number from the stamp or header as read from the image.
8. Proofread the caption on the agreement and on each exhibit: court, case number, party names and roles. They should match each other exactly.
9. Check the signature pages on the image for every party and every lawyer who was to sign.

Stamps and filing headers

A filing header across the top of each page adds a line of text to every page of the output, and a stamp placed over a paragraph can damage the words beneath it. If you are quoting the agreement, remove the header line from the working copy and keep it in the record copy. How court-applied marks behave in recognition is covered in the post on OCR for court filings, in its section on docket stamps and filing headers.

Exhibits that are court papers

Two exhibits are worth knowing by function, whatever your court calls them.

A dismissal. In federal court, Rule 41(a)(1)(A)(ii) of the Federal Rules of Civil Procedure allows a plaintiff, subject to the rules and statutes that provision lists, to dismiss an action without a court order by filing "a stipulation of dismissal signed by all parties who have appeared". A state court has its own rule, so check yours and whether it requires a particular form. For conversion, the points to read from the image are the case number, which claims and parties are dismissed, the words "with prejudice" or "without prejudice", and the signatures.

A stipulated or consent judgment. Where the agreement provides for one on default, the exhibit states an amount and the conditions for filing it. Check that the amount and the parties in the exhibit match the payment section of the agreement. In the Marsh file, Exhibit B gives a judgment amount of $84,000 "less payments made", which agrees with the total on page 3.

Court forms printed on line-numbered paper or laid out as boxes convert less cleanly than the agreement's paragraphs. Read their few variable entries from the image.

Handling a confidential settlement agreement during conversion

Read the confidentiality clause before the scan goes anywhere, including into a conversion tool. The clause says what must be kept confidential and who may be told. Whether sending a copy to an outside service fits within it is a decision for the lawyer responsible for the matter, made on that wording.

Find the clause by searching a text copy if you already hold one, or by paging the images: "confidential", "disclose", "non-disclosure", "terms of this Agreement", "amount". Then answer these from the clause itself:

With the answers in hand, conversion proceeds under whatever conditions the lawyer sets. Practical handling that applies in any case:

• Limit who holds copies. One record copy, one working set, one named folder with restricted access.
• Keep the amount out of file names. Marsh-Harrowgate_Settlement-Agreement_EXECUTED.pdf says enough.
• Know what the conversion service states about uploads. Schema Law's plans all state: "Your documents are never used to train an AI model", "Documents stay inside your own account", "Encrypted in transit and at rest" and "Delete any document, at any time". Those four lines are quoted from its pricing page, and the security section of the home page describes each commitment. Compare them with what the clause and your firm's policy require.
• Delete the uploaded copy when the exports are saved, if the lawyer's conditions call for it, and note the date.
• Treat every export as confidential. The Word file and the spreadsheet contain the same terms as the scan.
• Do not paste the text into email to circulate it. Send a reference to the folder.

When a copy must go to someone outside the permitted list, such as an auditor who needs proof the case ended but not the amount, the figure and other terms are removed first. Choosing those terms and applying the redaction safely is covered in the post on how to redact a scanned contract.

Tracking installment payments after the settlement is signed

Build a payment tracker from the proofread payment terms: one row per payment, with the due date, the amount, the last day of any grace and cure period as the agreement states them, and columns for what was actually received. Whoever monitors the settlement updates it on each due date.

The tracker for the Marsh settlement, part way through:

Columns worth having beyond those shown:

• Source. The section and scan page each row comes from, so a disputed date can be checked in seconds.
• Method and reference. Check number or wire reference.
• Notice sent and cure deadline. Filled only when a payment is late.
• Who was told. The client, the lawyer, accounts.

Rules for keeping it honest:

1. Enter due dates from the image-checked terms, not from the converted text.
2. Write intervals as the agreement states them beside any calendar date you compute. "Within 5 days after its due date" stays on the sheet. How weekends and holidays count is for the lawyer to confirm under the agreement and the applicable rules; the general method is in the post on how to turn a contract notice period into a calendar date.
3. Make the balance a formula. Total less the sum of amounts received. The final balance should reach zero on the last row.
4. Never overwrite a row. A late or partial payment gets its own note, and a bounced check gets a new line.
5. Attach proof. Save the check image or wire confirmation with the row number in its file name.
6. Record the end. When the last payment clears, note the date and any step the agreement then requires, such as filing the dismissal or returning an unfiled judgment.

If the payment schedule is a table in an exhibit, export it to a spreadsheet as the starting point. Schema Law's Excel and CSV exports are included in every plan, as the pricing page shows, and each exported row still needs its read against the image. For a twelve-row schedule, typing the rows from the proofread terms is a fair alternative and leaves no doubt about where each figure came from.