This is a guide to help you obtain funds after a lawsuit has been settled. Tapping into a funding source for a pre-settlement is one option that is not the same as a structured settlement. If you have any questions please contact our staff.
In all likelihood, once your lawsuit is settled, your attention will turn to the settlement funds and the timeline for receiving these. The majority of plaintiffs get their lawsuit check roughly six weeks after negotiations are concluded. Nonetheless, further delays are fairly common and your lawyer should be able to give you an estimated timeframe for receiving the money. The amount of time you have to wait will depend on several factors, like the type of lawsuit and the defendant’s actions — as well as any exceptional circumstances that hold up the processing time.
If you filed a lawsuit and reached a pretrial settlement agreement with the other party, the lawyers will inform the court that your case is settled. At this point, the court will issue a settlement order requiring each party to complete the settlement documents within one or two months (the exact timeframe varies from one jurisdiction to another). The release form is the key settlement document that has to be signed.
Understanding the Release Document
Release forms are used to confirm that defendants will not be pursued for any extra funds related to to the incidents they have been found liable for. The insurance firms of these defendants will not pay compensation until such forms are signed. This is done to avoid situations where defendants are subject to ongoing lawsuits.
Legally speaking, there is no reason why a release form can’t be reasonably short, however some insurance firms and defence lawyers opt for lengthy documents packed with legal jargon. After the release form is prepared by the defence lawyer, your lawyer will be given a copy to approve. Based on the document’s contents, this process could be straightforward, however certain aspects might be contestable.
If particular elements of your case will carry on, the release document should specify exactly what claims you are releasing the defendant from. Occasionally, it will take days for the lawyers to agree the final terms. Typically, they will reach a consensus, however if they fail to, they will ask the judge to intervene. This slows the process down significantly.
After the release form is accepted, you will be sent a copy to sign. Most of the time, you will have to do this in front of one or two witnesses. Prior to signing the document, you should study it thoroughly and talk to your lawyer about it. If you have any questions, do not hesitate to ask them. Your lawyer will submit the signed document to the defendant or the insurance firm, in addition to any other relevant documents. Once this is done, the conditions outlined in the document are final.
Actions of the Defendant
At this stage, the amount of time you have to wait for your money primarily depends on how the defendant behaves. In certain states, defendants have to provide the settlement cash by specific deadlines, once they get the release document. In some jurisdictions, defendants are charged interest on the money they owe – from the date the release document is sent to them. This is done to incentivize defendants to pay promptly.
Notwithstanding, there are often ambiguities that shrewd insurance firms and defendants can exploit to circumvent these undesirable outcomes. For example, the statute might not specify how long the insurance firm can spend processing the release document. Therefore, an insurance firm could receive the document, then spend a while entering the details into its computer database. This will increase your waiting time for the settlement, without missing the deadline by which the funds must be released.
Additional Tasks for Completion
Your lawyer will not be able to send you your allocation of the settlement funds until all personal injury liens are resolved. Liens give you the right, by law, to the assets of another person. Typically, there are two types of liens that pertain to personal injury lawsuits – governmental liens and medical liens. Most governmental liens are from Medicaid, child support agencies or Medicare. The holders of medical liens include health insurers and health care providers, who covered the medical treatment costs of the incidents in question.
As a general rule, liens have to be fully paid before plaintiffs can be awarded their settlement funds. Sometimes, your lawyer might negotiate to attempt to reduce the liens’ value, so you end up with a larger settlement. Such negotiations can be time consuming and prolong the period you have to wait for your money. The defendant’s insurance firm might cause delays as well, if the office they process the claim in is in a different state to the office they issue the check from.
The Role of Your Lawyer
Most settlement checks are sent to the lawyer of record. The lawyer will keep this check in an escrow account or trust, until it has cleared. This is just a short term measure that is not your lawyer’s decision — rather, it is a compulsory element of the process for settling lawsuits. After the settlement check has cleared, the funds will be distributed by your lawyer. This might take a number of days, particularly if the check is for a large sum. Also, your lawyer will retain a percentage of the settlement payment, to cover his or her legal services and any related costs that were advanced.
The exact fee you have to pay your lawyer will be outlined in the lawyer/client agreement you signed when your case commenced. In the meantime, your legal expenses will vary, based on factors that are specific to your circumstances. The amount you owe will include expenses linked to court reporting and deposition fees, expert witnesses and obtaining medical evidence – such as patient records. It is wise to get a statement displaying your legal expenses in itemized format. Also, if any of the listed expenses concern you, be sure to raise this with your lawyer.
The Impact of an Appeal
Most defendants file an appeal when a lawsuit trial rules against them. The appeal process can be long and drawn out. It might take over twelve months for the preparation work to be done. Then, of course, the court has to consider the evidence and come to a decision. There are three rulings an appellate court can make at the conclusion of an appeal trial. It can either reverse the initial judgment (which means you lose), uphold the initial judgment (which means you win), or resubmit the case to the court for another trial.
In some states, there are two appellate court levels. If the initial judgment is reversed or upheld by the appeals court in one of these states, either the defendant or the plaintiff can resubmit an appeal to the highest court in the state. This court, which is usually referred to as the ‘supreme court’, can then reverse or uphold the judgment – or resubmit the case to the appeals court for another trial. If a case is resubmitted to the court, the entire trial has to be started from scratch. Then, once this second trial has concluded, both sides can file a further appeal. For this reason, it is hardly surprising that the majority of plaintiffs in personal injury cases choose to settle their lawsuits.
Making the Process run Faster
If you experience undue delays with your settlement and are unsure what is happening, you should get in touch with your lawyer. He or she will be able to explain the situation, and maybe take some steps to resolve it. Also, your lawyer can give you some options that might facilitate your payment.
For instance, once your settlement is approaching, your lawyer could produce an acceptable release document. This form will specify the expected time period for receiving payment. You should provide your lawyer with the paperwork needed by the defendant to cut a check. In addition, your lawyer can use return receipt mailings and expedited shipping, so the defendant can’t claim that they never received the documents. If you believe that you will have to pay funds to creditors like medical providers, you could ask your lawyer for a partial distribution. He or she can hold the remainder of the funds and settle your claims that are outstanding.
Understanding Payments for Structured Settlements
A minority of personal injury claims are paid out through structured settlements. With this arrangement, victims receive a percentage of their settlement at regular intervals. In most cases, structured settlements are used with child victims, or when victims have catastrophic injuries that require costly, ongoing nursing and medical care.
Normally, with structured settlements, insurance firms fund annuities for victims. Annuities are insurance contracts that pay out a guaranteed amount regularly, over a set period. For instance, structured settlement annuities might pay victims a percentage of their settlement each month, each year, or once every couple of years.
On the face of it, structured settlements seem like a good idea, however they can be risky for victims in certain cases. Some annuities only pay out during a victim’s lifetime, so when the victim dies, all payments cease. If you are worried about this occurring, you should closely read and talk about the conditions of your prospective structured settlement with your lawyer.
What Happens With Uninsured Defendants
It is rare for a personal injury lawyer to pursue a case against an uninsured defendant. Suffice to say, most people without insurance cover for the incident in question have few assets. Generally speaking, there is little point in suing somebody with limited funds.
However, there are occasions when a defendant with substantial assets has no insurance to cover the underlying incident. In such cases, the settlement process is almost identical to the process used in cases where an insurance firm funds the settlement. The only difference is that your lawyer will ask the defendant for a certified check, prior to providing the signed release form and confirming that no further lawsuits will be filed in future.
Other Factors That can Delay the Process
It is worth noting that, even once you receive your settlement check, you might have to wait a while before you can access the funds. Usually, if you cash a check on certain weekdays, or after a particular time of day, it will clear within a few business days. Companies like JG Wentworth are notorious for being very slow to fund if you are re-selling a structured settlement payment. Holidays and weekends can hold up this process further. If you cash a check for a sizable amount of money, your bank might retain part of it for up to nine business days. This is done to verify that the money originates from legal sources. When your case finally concludes after a long period of time, you will not want to be kept waiting unnecessarily for your settlement. If you hire a good lawyer, he or she will work hard to make sure that you receive the cash you deserve as soon as possible.