How Long Can a Lawyer Hold Your Settlement Check in Massachusetts?

Receiving a settlement check is often the culmination of a lengthy legal process, but the journey doesn’t end there. Many clients wonder: how long can a lawyer hold onto my settlement check in Massachusetts? While there isn’t a fixed duration, understanding the legal framework, standard practices, and factors influencing the timeline can provide clarity.

Legal Framework: Massachusetts Rule 1.15 – Safekeeping Property

In Massachusetts, attorneys are governed by Rule 1.15 of the Rules of Professional Conduct, which pertains to the safekeeping of property. This rule mandates that lawyers hold client funds in a trust account, separate from their own, and ensures that such funds are not used for purposes other than those for which they were intended. The primary goal is to protect client property and ensure transparency in financial dealings.

Standard Practices in Handling Settlement Checks

Once a settlement is reached, the opposing party typically issues a check, which is sent to your attorney. The attorney then deposits this check into a client trust account, often referred to as an IOLTA (Interest on Lawyers’ Trust Accounts). This account is used to hold funds that belong to clients until they are properly disbursed.

Steps Involved in Disbursing Settlement Funds:

Deposit and Clearance: Upon receipt, the attorney deposits the settlement check into the IOLTA account. The bank then processes and clears the check, which can take several days to a week.
Lien Resolution: Before distributing the funds to the client, the attorney must address any outstanding liens or claims against the settlement. These may include medical liens, subrogation claims from health insurance providers, or other debts related to the case. Resolving these liens can take time, especially if negotiations are involved.
Deductions for Legal Fees and Expenses: Attorneys typically work on a contingency fee basis, meaning they receive a percentage of the settlement amount as their fee. Additionally, any case-related expenses must be deducted before the client receives their portion.
Final Disbursement: Once all liens are settled and deductions are made, the remaining funds are disbursed to the client. This process can take anywhere from a few weeks to a couple of months, depending on the complexity of the case and the number of parties involved.

Factors Influencing the Duration of Holding a Settlement Check

Several factors can affect how long a lawyer may hold onto a settlement check:

Complexity of Liens: If multiple liens or claims need to be resolved, the process can be prolonged. Negotiating with various entities, especially government agencies like Medicare or Medicaid, can add significant time.
Court Approvals: In some cases, especially those involving minors or incapacitated individuals, court approval is required before funds can be disbursed. Obtaining this approval can introduce additional delays.
Attorney Workload: The attorney’s caseload and administrative processes can impact the speed at which settlement funds are disbursed.
Insurance Company Delays: Delays from the insurance company in issuing the settlement check can also extend the timeline.

Legal Protections and Client Rights

Massachusetts law provides protections for clients to ensure that settlement funds are handled appropriately. If a client believes that their attorney is unreasonably delaying the disbursement of settlement funds, they have the right to:

Request an Accounting: Clients can ask their attorney for a detailed breakdown of how settlement funds have been allocated.
File a Complaint: If concerns persist, clients can file a complaint with the Massachusetts Board of Bar Overseers, which oversees attorney conduct in the state.
Seek Legal Recourse: In extreme cases, clients may pursue legal action against their attorney for mishandling of funds.

It’s essential for clients to maintain open communication with their attorney and to be proactive in addressing any concerns regarding the handling of settlement funds.

While there is no fixed timeline for how long a lawyer can hold onto a settlement check in Massachusetts, the process is governed by strict ethical guidelines and legal requirements. Understanding the steps involved and the factors that can influence the duration can help set realistic expectations. If you have concerns about the handling of your settlement funds, it’s crucial to address them promptly to ensure that your rights are protected.

Frequently Asked Questions (FAQ) About How Long a Lawyer Can Hold Your Settlement Check in Massachusetts

1. How long can my lawyer hold onto my settlement check in Massachusetts?

The duration for which a lawyer can hold onto a settlement check in Massachusetts varies based on several factors, including the complexity of the case, the need to resolve liens, and the lawyer’s administrative process. Typically, the funds are held in a client trust account (IOLTA), and it may take a few weeks to several months for the lawyer to resolve all necessary financial matters, such as liens, legal fees, and case expenses, before disbursing the final amount to the client.

2. What is an IOLTA, and why is it important in this process?

An IOLTA (Interest on Lawyers’ Trust Accounts) is a special trust account where lawyers are required to deposit client funds, such as settlement checks, to ensure that the funds are kept separate from the lawyer’s personal accounts. This account serves to protect the client’s money and ensures that no funds are misused. The funds in the IOLTA account remain there until the lawyer settles any outstanding obligations, such as medical liens or legal fees, and is ready to disburse the remaining balance to the client.

3. Why might there be delays in receiving my settlement check?

There are several potential reasons for delays in receiving your settlement check:

Clearing the Check: The bank must clear the settlement check before the funds can be disbursed, which can take several days or even a week.
Liens and Claims: If there are any liens (e.g., medical or insurance claims), they must be resolved before the attorney can distribute the funds. Negotiating and settling these liens can take time.
Legal Fees and Expenses: The attorney will need to deduct their legal fees and any case-related expenses before disbursing the funds to the client.
Court Approval: In some cases, such as when a minor is involved, the court’s approval may be necessary before the settlement funds can be distributed.

4. What if my attorney is holding onto my settlement check for an unusually long time?

If you feel that your attorney is holding onto your settlement check for an excessive amount of time, you have several options:

Request an Accounting: You are entitled to request a detailed accounting from your attorney to understand why the funds are being held.
Communicate Concerns: Open communication with your attorney can often resolve misunderstandings. If the delays are due to lien negotiations or legal fees, your lawyer should explain the process to you.
File a Complaint: If your attorney’s delay seems unreasonable or suspicious, you can file a complaint with the Massachusetts Board of Bar Overseers, which monitors attorney conduct in the state.

5. Can I file a complaint if I think my lawyer is mishandling my settlement check?

Yes, if you believe your lawyer is mishandling your settlement check or failing to disburse the funds properly, you have the right to file a complaint with the Massachusetts Board of Bar Overseers. The Board investigates claims of unethical behavior and can take disciplinary action if necessary. You may also be able to take legal action against your lawyer if you believe they are violating professional conduct rules.

6. What should I do if I have an urgent need for the settlement money?

If you need the settlement money urgently, it’s important to communicate your needs to your attorney. While the legal process and requirements cannot be expedited at will, your lawyer may be able to provide a rough timeline or prioritize certain tasks to move the disbursement along faster. Be sure to explain your situation clearly, so they can assist you accordingly.

7. Is it normal for lawyers to take a percentage of my settlement?

Yes, it is standard practice for lawyers to take a percentage of your settlement amount, known as a contingency fee. This fee is typically agreed upon before the lawyer takes on your case. In Massachusetts, the fee is usually between 25% and 40% of the total settlement, depending on the complexity of the case and whether it goes to trial. Your lawyer should provide you with a clear written agreement outlining their fee structure and any other costs associated with your case.

8. Can I get the full settlement amount?

The full settlement amount you receive will depend on the terms of your settlement agreement and any deductions for legal fees, case expenses, and liens. For example, if you have unpaid medical bills or your health insurer paid for your medical treatment, those liens must be resolved before you receive the remaining funds. Your lawyer is obligated to ensure that these debts are settled before disbursing the remaining settlement money to you.

9. What happens if there are multiple liens or claims on my settlement?

If there are multiple liens or claims, your attorney will work to negotiate and resolve them before distributing the remaining funds. These liens might include medical liens, health insurance subrogation claims, or even government claims like those from Medicaid or Medicare. The process of resolving liens can be time-consuming, especially if negotiations with multiple parties are necessary. Your attorney has a fiduciary duty to act in your best interest and may try to reduce the amount owed to these parties through negotiations.

10. Can I choose which bills or debts are paid first from my settlement?

Typically, your attorney will prioritize legal obligations like medical liens and other legal claims, which often have a higher priority. However, in some cases, you may be able to negotiate with your attorney to address certain debts first, depending on your financial situation and the terms of your settlement agreement. Communication with your attorney is key to ensuring that your needs and priorities are understood.

Receiving a settlement check is a significant step in resolving your case, but it doesn’t mean the process is over. In Massachusetts, lawyers are required to handle settlement funds carefully and in accordance with legal and ethical standards. While there are no set rules about how long a lawyer can hold onto a settlement check, the process involves clearing the check, resolving any liens or claims, deducting legal fees and expenses, and ultimately disbursing the funds to the client.

If you find that your lawyer is holding onto your settlement check for an unusually long time, it’s important to communicate with them and ask for an explanation. You are entitled to an accounting of how the funds are being managed, and if necessary, you can file a complaint with the Massachusetts Board of Bar Overseers or seek legal recourse.

Being proactive in understanding the process and maintaining open communication with your lawyer will help ensure that your settlement funds are handled appropriately and efficiently.