When we speak about personal injury lawyers and their function in your case, we often talk about them being your guide to the legal process and the defender of your legal rights. We speak of lawyers using their power and experience to work on your behalf. However, before you hire a personal injury lawyer, you need to understand exactly what they can and cannot do in your legal case.
A large majority of personal injury cases will settle at some point rather than go into litigation. The settlement will usually come at the end of a negotiation process. It may take months, or even longer, to agree on settlement terms. This back-and-forth is a process your personal injury lawyer will work through in tandem with you as the client.
Your Attorney Won’t Settle Without Your Permission
We cannot state this point strongly enough. At no point, unless they have specific permission from the client, can attorneys act unilaterally in a settlement without their client’s consent. Hard stop. Period. An attorney can get into serious trouble for breaking this fundamental rule of representing a client.
Every lawyer must hold a license with the bar in the state where they practice. Each bar has similar rules modeled on the same general set of obligations. These laws govern the lawyers’ professional responsibility and define what they must do when representing you. The consequences for violating these rules can be severe.
Lawyers can receive punishments that range from censure to a suspension from practicing to a complete revocation of their law license. Most lawyers will take these rules very seriously because breaking them can have serious consequences for their reputation and ability to practice law. These are fundamental rules of honesty and professional responsibility for every attorney who practices law.
How Rules of Professional Responsibility Affect Your Case
There is a specific rule that attorneys must follow when they have received a settlement offer. The insurance company or defendant makes the offer to your attorney because when an attorney represents you, the attorneys representing the other side may not speak directly to you.
The American Bar Association Model Rules of Professional Conduct Rule 1.4 says that an attorney must communicate promptly with a client after receiving a settlement offer from opposing counsel.
The rule itself states that:
Reasonable communication between the lawyer and the client is necessary for the client effectively to participate in the representation.
This requirement applies to every aspect of legal representation. When there are developments in your case, the attorney must communicate them to you promptly. The lawyer must communicate with you regarding the substance of the offer within a reasonable period. The only thing that relieves an attorney from this obligation is when you informed them in advance that you will accept or reject a settlement offer meeting given criteria. In reality, there is little reason for you to do that because you probably want to maintain the right to make decisions in your case.
The Attorney Must Keep You Informed
Not only must your lawyer relay the offer to you, but the ABA Model Rules also require that the attorney give you sufficient explanation for you “to participate intelligently in decisions concerning the objectives of the representation and how they are to be pursued, to the extent the client is willing and able to do so.” In other words, the lawyer must tell you about the substance of the offer and explain it to you so you can decide in consultation with your attorney.
Whatever decision you make, the lawyer must accept it, regardless of whether the attorney agrees with your decision. This requirement is made very clear in ABA Model Rule 1.2, which says:
“A lawyer shall abide by a client’s decision whether to settle a matter.”
You Decide Whether to Settle a Case (With Advice from Your Lawyer)
The rules could not be any clearer. Unless you have specifically authorized the lawyer in advance (which you should rarely, if ever, do) to make a settlement decision, only you can choose whether to settle the case. You, the client, must decide whether to settle a case. This is a basic principle of legal representation.
There are times when your lawyer’s interests may not always match yours. In virtually every personal injury case, lawyers are paid on a contingency fee basis, meaning they receive a percentage of your financial recovery, but only if you receive one. In other words, they only receive payment if you reach a successful result in your case., either through settlement or litigation. If you get nothing, your lawyer is not paid anything for the time and effort spent on your case.
Some lawyers (acting improperly in their own self-interest) want to settle cases as soon as possible, so they can get paid and move on to the next one.
The proper way for a lawyer to act is by giving you objective advice in your interest, regardless of how it impacts the attorney’s bottom line. Attorneys assume this duty to you the second that you enter into a representation agreement.
Hypothetically, let’s say that you received a fair settlement offer that pays you for all or just about all of your damages. Your lawyer may review the settlement offer, tell you that the offer is reasonable, and advise you to accept it. If you accept the offer, the lawyer will be guaranteed payment for their time. However, you may feel strongly about the case and believe that you can hold out for more money, even if your lawyer tells you that you have risks in going to court and may not get any additional funds from a jury.
Lawyers Must Represent You and Follow Your Wishes
If you decide to go to trial, you primarily bear the risks. Regardless of what the lawyers may think, your lawyers must obey your instructions in your case. They have signed a legal agreement that promises to represent you in your case, and they must follow it except for very limited circumstances. The attorneys retain the ability to petition the judge to withdraw from the case if they think that you are doing something illegal or if you simply cannot agree on the case strategy.
While your attorney may often get a greater percentage of your recovery in cases that go to trial, it also represents far more work for them. Nonetheless, as the client, you decide whether to settle your case. Your lawyer’s role here is solely to advise you. It is your right to decide whether to settle your case. Usually, despite this sort of disagreement, the lawyer needs a very good reason to withdraw from your case.
How a Lawyer Normally Handles Your Case
What normally happens in negotiating a settlement in any personal injury case is:
- The defendant or insurance company makes the initial settlement offer to your attorney
- Your attorney must timely communicate the settlement offer to you and give you an opinion about whether it was reasonable. Together, you will discuss whether you may get a better offer and the strategy you can use going forward.
- Your lawyer will lay out all of the considerations. He or she may give you an opinion about whether you should reject or accept the settlement offer, considering your circumstances.
- You then decide whether to accept the settlement offer.
- Your lawyer communicates your decision to the insurance company or defendant.
- If you reject the settlement offer, your lawyer will send a demand letter with your position regarding how the settlement you believe you should get.
- If you accept the settlement offer, your lawyer will negotiate the language of the actual settlement agreement with the other side.
Note that all of these points focus on you because you are the decision-maker in your personal injury claim. Your attorney is simply an advisor to and advocate for you.
What Happens if a Lawyer Settles Your Case Without Permission
You may be wondering what happens if the lawyer does settle your case independently of you and without your permission. The question is whether that agreement is binding on you. Here, the news is not very good. The lawyer is your formally retained representative or agent. In such a case, an agent’s action binds you to the settlement agreement, regardless of whether it was something you wanted to do.
Of course, getting to this point assumes that the lawyer has already broken a whole host of rules (including, for example, forging your signature on the settlement agreement, which may well be a felony), and you have recourse for those violations.
You can file a malpractice lawsuit against your attorneys and possibly an action for fraud. You might even request criminal charges for forgery. Nonetheless, none of this changes the fact that you have legally accepted a settlement that you may not have wanted in the first place.
You may also sue the attorney for breach of fiduciary duty to you. As a fiduciary, your lawyers must place your interests first, ahead of their own. They also must share information with you promptly. If they have breached their duty to you and caused you damage by doing so, you can file a lawsuit. In some jurisdictions, this will be a part of a malpractice lawsuit. In others, you may file an independent lawsuit for breach of fiduciary duty.
Finally, consider reporting the attorney to the state bar, which may then investigate your complaint. If the investigators establish that the attorney settled the claim without your consent, the attorney may face serious consequences, including disbarment. Reporting the misconduct can help future clients and keep them from experiencing what you did.
If you learn that the attorney settled the case without your consent before the check is issued, you should fire them immediately and looks for a new lawyer. The other side needs your signature on the settlement agreement, and you should refuse to sign one that you have not authorized.
These are very rare circumstances. The vast majority of personal injury lawyers follow the settlement rules closely. If they disagree with the client, they will handle it only in a manner allowed by the rules. The attorney who is likely to break these rules is uncommon, and the bar association deals harshly with those who do not follow the rules to the letter.
Check Into Your Attorney Before Hiring Them for Your Case
Look closely into the background of your attorneys before you hire them. You are trusting your attorneys with your financial future, and they have a great deal of power over your case. If they fail to live up to their fiduciary and professional obligations, they can do you a great deal of harm.
Before you sign any representation agreement, you should search the lawyer’s disciplinary history. Each state bar will publish disciplinary actions, which are relatively easy to locate in a public search. Make sure to hire an attorney who exhibits a sound ethical record and follows the rules.
Again, settling a case without client authorization is not a common occurrence. If you find that you are not getting information or responses to your inquiries from your lawyers, make sure to ask questions. If they ignore your questions, they violate their professional obligations and duties to you. While you generally should not switch attorneys in the middle of your case, you may have no choice if you cannot get the answers that you need promptly.
Pay close attention to the service that your lawyer delivers during the initial consultation and the early stages of your case. Although your attorney may be busy and may not get back to you immediately, they or their staff should answer and provide you with information as soon as they can within a reasonable period. If an attorney is not responsive and helpful even before signing a representation agreement or right afterward, this behavior will probably only get worse as your case progresses.
Abels & Annes
100 N LaSalle St #1710
Chicago, IL 60602