How Long Can a Lawyer Hold Your Settlement Check?
The question of how long a lawyer can hold your settlement check is a complex one, dependent on several factors. There's no single, universally applicable timeframe. Understanding your rights and the ethical obligations of your attorney is crucial. This article explores the legal and ethical considerations surrounding attorney retention of settlement funds.
What are the ethical considerations for lawyers holding settlement checks?
Lawyers are bound by strict ethical rules governing the handling of client funds. These rules vary slightly by state but generally require attorneys to hold client funds in a separate trust account, also known as an escrow account, and to promptly disburse them according to the client's instructions. Holding the funds longer than necessary is a breach of these ethical rules and can lead to disciplinary action.
Why might a lawyer need to hold a settlement check?
Several legitimate reasons might explain a delay in receiving your settlement check:
- Unresolved Liens or Debts: The settlement might need to cover outstanding medical bills, liens from previous legal actions, or other debts. Your lawyer will need to ensure these are addressed before distributing the remaining funds.
- Complex Settlement Agreements: Some settlements involve multiple parties or intricate agreements that require careful review and processing. This can take time to ensure all terms are correctly fulfilled.
- Outstanding Fees and Expenses: Your lawyer is entitled to their fees and reimbursement for expenses incurred during the case. These are usually deducted before you receive your portion of the settlement. Your agreement should clearly outline these costs.
- Tax Implications: The lawyer may need to consult with a tax professional to advise on the tax implications of the settlement, particularly significant sums. This is to ensure you are prepared for tax liabilities.
- Disputes over Distribution: If the settlement involves multiple claimants, disagreements over the distribution of funds might cause delays.
What are my rights if my lawyer is holding my settlement check too long?
If you believe your lawyer is holding your settlement check unreasonably, you have several options:
- Contact your lawyer: The first step is to communicate directly with your attorney. Ask for a clear explanation of the delay and a timeline for disbursement.
- Review your retainer agreement: This contract outlines the fee arrangement and should clarify the process for distributing settlement funds.
- File a complaint with your state bar: If your communication with your lawyer is unsuccessful, you can file a formal complaint with your state's bar association, the body responsible for regulating attorney conduct.
- Seek legal advice from a different attorney: Consulting another lawyer can provide an independent assessment of your situation and guidance on your options.
- File a motion with the court (if applicable): In some cases, you may need to file a motion with the court that oversaw the case, requesting an order for the release of the funds.
How long is too long?
There's no magic number. A reasonable timeframe depends heavily on the complexity of the settlement. However, undue delays exceeding several weeks without a clear explanation should raise concerns. Consistent communication is key. If your attorney is unresponsive or offers vague reasons for the delay, it’s time to take further action.
Can I sue my lawyer for holding my settlement check?
While you may not be able to sue solely because of a delay, you can sue for breach of contract if the delay violates your retainer agreement. You might also have grounds to sue for legal malpractice if the delay causes you significant harm. This would typically require evidence of negligence or misconduct.
This information is for educational purposes only and does not constitute legal advice. If you have concerns about your lawyer's handling of your settlement check, it's imperative to seek legal counsel from an independent attorney.
