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What to Do If Your Lawyer Takes Your Settlement

lawyer took my settlement

What should I do if my lawyer took my settlement money? If you find yourself facing a situation where your lawyer possibly took your settlement money, it’s important to know that this isn’t how things should work. A lawyer is there to help, not put you in an even more difficult situation. So, what can you do if you find yourself in this unfortunate circumstance?

Can a Lawyer Steal Your Settlement?

Legally, a lawyer cannot steal your settlement. They are bound by law and professional ethics to act in your best interests. If they take your settlement without your permission, this is a serious breach of trust and professional misconduct.

Note, though, that a lawyer is legally entitled to a portion of the settlement as part of their fees. This is an amount agreed upon before the attorney-client relationship. 

What Should I Do If My Lawyer Took My Settlement? 

If you strongly believe that your lawyer took your settlement, then there are several steps you can take to correct the problem. Here are some tips on how to proceed:

Directly Ask the Issuing Party

Start by confirming with the issuing party if the settlement check has already been issued. Your lawyer may deny receiving the check to delay or defer its payment. If the issuing party has already issued the check, ask for a written confirmation of this transaction. Perhaps ask for the check number, the tracking number, or a copy of the transmittal.

Directly Ask the Lawyer

Before jumping to conclusions, reach out to your lawyer. It’s important to get clarity on the situation. Misunderstandings can happen and there may be a legitimate explanation for the confusion. 

Keep in mind that a lawyer handles the payment of expenses from the settlement money. For example, if you have pending medical bills incurred due to the injury you or a loved one sustained, then your lawyer will have to pay those first before giving you the remaining amount. Your lawyer may be still in this stage of the process, delaying your payment as a result. 

Review Your Agreement

Look over the agreement you signed with your lawyer. It should detail how your settlement is to be managed and the fees they are entitled to. 

⚖️ PRO TIP: Most personal injury lawyers get paid on a contingency fee basis, which is usually a small percentage of the settlement or verdict. That’s the same reason they won’t charge you upfront costs when they take on your case. 

Understanding this agreement is key to determining if your lawyer has acted improperly. If possible, do the math to figure out the exact amount you should get from the overall settlement check. Keep in mind that other fees, such as medical fees or property damage, may need to be paid first.

Report the Issue

If your lawyer is uncooperative or if you believe they have acted unethically, you can report them to your State’s Bar Association. Bar associations take such allegations seriously and will investigate the matter.

Seek Legal Advice

It may seem unusual to seek legal counsel against a lawyer, but doing so will help you better understand your rights and options. They can offer guidance on how to process, including whether you have grounds for legal action against your original lawyer.

Can I Sue My Lawyer if They Took My Settlement?

Yes, you can. If your lawyer has unlawfully taken your settlement, they may be liable for theft, fraud, or breach of contract. You can sue for the return of your funds and possibly additional damages. 

However, you will have to prove that the lawyer took the amount you should have received. A good start is to obtain a statement from the issuing party stating that the settlement check was already sent to your lawyer. From there, you can present any written communication you have with your lawyer asking about the status of the settlement.

Establishing a timeline is critical in these situations. To create the conclusion that the lawyer took your settlement check, you need to prove that there has been an unreasonable lapse since its issuance. 

A few days of delay from the promised release isn’t enough to support this conclusion but a month or several months of delay may be sufficient ground.

Note however that your lawyer can raise a reasonable defense against this. For example, they can state that the payment of liens is taking longer because of some missing information from either party. They might also provide evidence to prove that they are not acting out of bad faith. If you still don’t have the settlement check because of a valid reason, then there’s no ground to sue.

How To Tell if Your Lawyer Is Cheating You on a Settlement

Recognizing the signs of unethical behavior can help you determine if your lawyer is cheating you. Here are some signs to watch out for:

Lack of Transparency

If your lawyer isn’t providing a clear and detailed accounting of your settlement funds, that’s a red flag right there. Ideally, you should have a full list of pending payments associated with your injury. This includes hospital bills, professional fees of doctors, prescription medications, therapy, property repair, and so on.

Delayed Communication

While lawyers are often busy, consistent delays or lack of response to your inquiries about your settlement are concerning. Make sure that every communication you have with your lawyer is in written format. 

It can be via email, registered mail, or even a personal delivery of the letter. This way, it’s easy for you to prove that multiple attempts to communicate were made.

Sketchy Responses

Your lawyer should be open to questions and ready to address legal concerns you may have. If they decline to answer your questions or give vague answers, this might also be another red flag. 

Legal jargon often sounds complicated, and part of the lawyer’s job is to create a bridge between complicated legal concepts and the client. You want a lawyer who will explain the process to avoid confusion on your part.

Change in Fee

If your lawyer suddenly changes their fees without proper explanation or agreement, it’s a cause for concern. Keep in mind that the settlement agreement contains the value of the legal fees. 

This serves as the contract between yourself and your lawyer. If the amount charged is different from the amount stated in the contract, then you have grounds to sue for breach. Do not be swayed by verbal assurances—an agreement reached in writing will always be superior to a verbal one. 

Accounting of the funds should also be given upon deposit of the settlement check in your account. Part of your responsibility is to double-check the expenses to make sure that everything adds up and you’re getting the exact amount you should.

Pressure to Settle Quickly

This red flag should be quite obvious during the settlement process. If your lawyer is pressuring you to accept a settlement without adequately explaining the terms or giving you time to consider, they might not have your best interests in mind. 

The White v. Kreithen case is a good example of such a scenario. The Pennyslvannia Superior Court ruled that the plaintiff was forced to settle for $150,000 to avoid going to trial due to the fact that their attorney did not have the case ready for trial. This was a case of legal malpratice. 

How Much Do Lawyers Usually Take From Settlement?

Lawyers typically charge a contingency fee in personal injury cases. This means they receive a percentage of the final settlement, often between 33 and 40 percent. You only have to pay when the insurance company or liable party agrees to pay the settlement. Note though that this is not a fixed amount. 

Some lawyers may ask for more or less depending on the complexity of the case. The experience of the lawyer is also factored in, with seasoned lawyers typically asking for higher rates to match the quality of their service. 

Make sure that the percentage will be taken against the final settlement or the remaining amount after the deduction of the liens and other payables. This fee should be clearly stated in the agreement with the lawyer and should not include additional costs like court fees or expenses for medical records. 

How Can I Track My Settlement Check?

Tracking your settlement check is easy enough to do once you understand the procedure it goes through before reaching your hands. There are mainly two ways to track your settlement check:

Regular Updates

Ask your lawyer for regular updates on the status of your settlement check. Do this in writing and within reasonable time frames. Daily status checks won’t do you any good and may only add pressure to your lawyer. Once a week, in most cases, sounds more reasonable. 

Direct Contact

If applicable, contact the insurance company or the payer directly to verify the status of the settlement payment. As with your lawyer, make sure to do this in writing too. 

Online Tracking

If you’re claiming your check through a settlement arbitrator, then chances are they’re using online tracking schemes. You’ll be provided with a tracking number that you can input into the portal. 

How Long Can My Lawyer Hold My Settlement Check?

A lawyer should only hold onto a settlement check for as long as necessary to resolve any outstanding matters such as paying liens or other legal obligations related to your case. Typically, this process should not take more than a few weeks from the moment the issuing party gives the check to the lawyer. Ideally, your lawyer should give you an estimated time for release once they receive the check.

Note though that the period between settlement and delivery of the check may vary from one location to another. Generally, you first agree on a settlement amount followed by the Settlement Agreement. 

This involves filling in forms, signing documents, and submitting them to the insurance company or the party at fault. From there, the issuing company processes the settlement and issues the check to your lawyer. 

In States like Pennsylvania, the PA Rules of Civil Procedure No 29.1, defendants should deliver the settlement check within 20 calendar days from the execution of the release. The settlement check should be given directly to the lawyer or the injured party if they didn’t retain a lawyer. Illinois, on the other hand, recently approved a bill that requires insurance companies to pay the settlement agreement within 30 days from the release.

How Can I Ask My Lawyer About My Settlement?

You have every right to ask your lawyer about the settlement and its status. Communication is key. Ask your lawyer straightforward questions about the status of the settlement and any deductions, including when you can expect to receive your portion. 

If your lawyer fails to respond within a reasonable timeframe, remind them of their duty to keep you informed about your case. You can also ask for a copy of the settlement check just to confirm that it is already in their hands.

⚖️ PRO TIP: By “reasonable” timeframe, we mean between three days to a week. Anything beyond that is generally considered unreasonable. 

Calling your lawyer to ask about the status of the check may seem like the simplest way to get things. However, verbal assurances may not give you the best protection in the long run. 

Ideally, communication should be in writing (text, email, letters personally delivered, or mailed). This way, you have physical proof of effort on your part to stay updated.

How Long Till I Get My Settlement Check After I Agree To Settle?

The timeline can vary, but generally, it takes about six weeks to receive your settlement check after agreeing to a settlement. This period allows for the completion of necessary paperwork and resolution of any liens against the settlement. 

Always remember that the check passes through different stages before it reaches you. For this reason, there’s a good chance that a delay in any of those stages will cause a delay in your receipt.

The countdown starts from the moment you sign the release form and submit it to the insurance company or the issuing party. From there, the issuing party prepares the check and releases it to your lawyer. 

Your lawyer may have to hold onto it for some time as they first settle liens associated with the injury. Afterward, the check will be deposited in the bank. In some cases, delay happens at the bank level and you’ll have to contact the bank directly to resolve the issue.

If you suspect your lawyer has taken your settlement, take immediate action. Start by communicating directly with your lawyer and review your agreement. 

If necessary, report the issue to the bar association and seek advice from another attorney. Remember that your lawyer should work in your best interest and it’s important to stay informed and proactive throughout your case.

Written by
Serah Waweru

A graduate of Western Michigan University Cooley Law School, Serah Waweru is a personal injury and immigration attorney based in Tacoma, Washington. Her law firm serves clients in Washington and all over the United States. Serah has always been passionate about the law; she served as the Vice President of the Western Michigan University Cooley Law School Student Bar Association and vice president of the university's Black Law Students Association. Attorney Serah Waweru is also a proud member of the American Immigration Lawyers Association and the Washington State Bar Association.

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