A recent legal malpractice case involving one of the country’s largest personal injury firms caught my attention. In fact, the whole mess has been a big topic of recent discussion among professionals on LinkedIn.
According to reporting by the Atlanta Journal-Constitution, a Georgia man alleged his personal injury case was settled for $45,000 without his permission. That’s important — Without his permission. Of course, the law firm disputed that allegation. But, this is not the first time, I’ve heard people report that certain large volume advertising firms had settled their claims without permission.
The dispute ultimately went to arbitration. For me, this is another big issue. This “large” law firm that advertises it’s working for people, makes those people sign arbitration clauses in its attorney fee contracts. Wow. To me, that sounds like the height of hypocrisy. But, I’ll save the arbitration topic for another day. Right now, let’s just talk about large advertising firms not communicating with their own clients. The arbitrator ruled for the former client and awarded approximately $4.3 million, including compensatory damages, emotional distress damages, attorney fees and costs, and $3.15 million in punitive damages.
I don’t know everything that happened between that lawyer and client, and I have no interest in using someone else’s dispute simply to criticize another law firm.
But the story raises an important question for anyone with a personal injury claim:
Who actually decides whether your case settles?
The answer is simple.
You do.
And that decision should come after a meaningful conversation with a lawyer who actually knows you, understands your injuries, knows the evidence, and can explain what accepting—or rejecting—a settlement offer really means. As I’ve said repeatedly in past posts, every case involves a unique human story that deserves attention.
A Lawyer Can Recommend Settlement. The Client Decides.
Personal injury lawyers make strategic decisions every day.
We decide what evidence needs to be gathered. We decide which witnesses need to be interviewed. We decide what questions should be asked in depositions. We analyze medical records, investigate insurance coverage, work with experts, evaluate defenses and prepare cases for trial.
But settlement is different.
Lawyers need to explain matters sufficiently for clients to make informed decisions! If you are looking for a lawyer, you should absolutely hire one that will spend the time to learn your unique story and your unique case. A lawyer should absolutely give advice. In fact, I believe a lawyer should do more than simply relay numbers back and forth between an insurance company and a client. A good lawyer who takes the time to know his client and learn the case, has probably built trust with his client. Would you trust a settlement mill lawyer who never spoke with you?
If I believe an offer is good, I should tell my client and explain why.
If I believe an offer is too low, I should explain that too.
If rejecting an offer creates significant risk, the client needs to understand the risk.
If I believe the case should be prepared for trial rather than settled at the present number, I should be willing to say so.
The lawyer provides judgment and advice.
The client makes the final decision.
Both are based on trust. That trust is built when the lawyer spends the time with his client to listen, learn and understand.
Settlement Should Be a Conversation, Not a Transaction
This is where the difference between personally handling cases and simply processing claims becomes important.
Imagine an insurance company offers $200,000 to settle an injury case.
That number by itself tells us very little.
What are the medical expenses?
Are there unpaid medical bills?
Are there health insurance reimbursement claims or other liens?
How much will the client actually receive after fees, expenses and medical obligations?
Does the client need future medical treatment?
Has a doctor placed permanent restrictions on the client?
Has the injury affected the client’s ability to work?
What does the evidence show about fault?
Are there weaknesses in the case that could become significant at trial?
What is the available insurance coverage?
What kind of verdict might reasonably be expected in the county where the case would be tried?
Those questions cannot be answered by looking at a settlement number on a computer screen.
And they certainly cannot be answered intelligently without knowing the client.
A meaningful settlement discussion should include both the value of the case and the risks of continuing it.
Sometimes I tell clients that I believe they should reject an offer.
Sometimes I tell them that I believe an offer deserves very serious consideration.
Sometimes a client wants to continue fighting when the lawyer believes settlement is the safer choice.
Sometimes the opposite is true.
That is all part of representing real people in real cases.
You Cannot Properly Value a Case If You Do Not Know the Client
Medical records are important. Medical bills are important. Lost wages are important.
But an injury case is not simply the sum of numbers contained in records.
Two people can suffer similar physical injuries and experience very different consequences.
A shoulder injury might prevent one person from performing a heavy industrial job.
The same injury might keep another person from lifting a grandchild.
A back injury may prevent someone from hunting, gardening, coaching youth sports or doing the work around the house that he or she has always done.
A serious injury may change someone’s ability to sleep, travel, exercise or simply enjoy normal daily activities.
You do not learn those things by reviewing a stack of medical records.
You learn them by talking to your client.
That is one reason we believe lawyer-client communication matters throughout a personal injury case—not merely when it is time to settle.
If a lawyer first tries to understand a client’s life when a settlement offer arrives, important parts of the case may already have been missed.
The Problem With the Settlement-Mill Model
Every law office needs systems.
We certainly do.
Personal injury cases involve deadlines, medical records, bills, insurance correspondence, discovery, scheduling and hundreds of other details. Good systems help lawyers handle those responsibilities carefully and efficiently. Good systems should exist so the lawyer can maximize his or her time studying the real human story of his client.
The problem begins when efficiency replaces judgment. The biggest problem is when efficiency replaces the connection of the human story.
A personal injury case should never become nothing more than a production line:
Sign the client.
Send the client for treatment.
Collect the records.
Send a demand.
Receive an offer.
Settle the file.
Move to the next one.
That may be an efficient way to process claims. It is not how I believe serious personal injury cases should be handled.
The concern becomes even greater when lawyers carry so many cases that meaningful client contact becomes difficult.
In the recently reported Georgia arbitration, the former client said he spoke with the lawyer assigned to his case only once early in the representation and thereafter primarily communicated with a paralegal. He claimed he learned the case had been settled when he received paperwork to finalize the agreement.
Whatever happened in that particular case, the larger lesson is worth considering.
A lawyer cannot outsource the attorney-client relationship.
Good paralegals are enormously important. Ours are involved every day in helping clients, obtaining records, coordinating information and moving cases forward. Our paralegals know each and every client.
But there are decisions where the lawyer needs to be personally involved.
Settlement is one of them.
Knowing the Gross Settlement Is Not Enough
Clients also need to understand that the settlement amount and the amount they actually receive are different numbers.
Suppose an insurance company offers $250,000.
That sounds straightforward.
It isn’t.
There may be attorney fees.
There may be litigation expenses.
There may be medical bills.
A health insurer may claim a right of reimbursement.
Medicare or Medicaid may have an interest.
A workers’ compensation carrier may assert a subrogation claim.
Some of those amounts may be disputed or negotiable.
So when we evaluate a settlement, one of the questions I want answered is:
What does this actually mean for my client?
A $250,000 settlement with substantial reimbursement obligations may look very different from a $250,000 settlement where those obligations have been reduced significantly.
That is another reason settlement should not be treated as merely accepting or rejecting a headline number.
A Lawyer Should Give You an Opinion
There is another side to this issue.
Telling a client, “The insurance company offered $150,000. What do you want to do?” is technically communication.
But it is not much legal advice.
Clients hire lawyers because they want judgment.
By the time a significant settlement offer arrives, the lawyer should know enough about the case to explain:
Here is what I think the case is worth.
Here are our strongest points.
Here are the problems I see.
Here is what happens if we reject this offer.
Here is what I believe we should do.
The client may agree.
The client may disagree.
Ultimately, it remains the client’s decision.
But a lawyer should be willing to make a recommendation and stand behind it.
Building Cases Makes Better Settlement Decisions Possible
Good settlement decisions usually begin long before an offer arrives.
They begin with building the case correctly.
That means investigating the accident.
It means obtaining the right evidence.
It means understanding the medicine.
It means knowing what the client’s doctors actually believe.
It means documenting how an injury affects work and daily life.
It means preparing the case with the possibility that it may ultimately have to be presented to a jury.
And it means communicating with the client along the way.
When a case has been properly developed, both lawyer and client are in a much better position to evaluate a settlement offer. And, by working together, both of them understand and trust the other.
When it has simply moved through a settlement pipeline, that judgment becomes much harder.
Your Case Belongs to You
Personal injury lawyers sometimes talk about “our cases.”
I do it too.
But ultimately, the case belongs to the client.
It is the client who was hurt.
It is the client who went through medical treatment.
It is the client who missed work.
It is the client who lives with the limitations caused by an injury.
And it is the client who has to live with the final decision.
The lawyer’s job is to investigate the case, build the evidence, understand the injuries, evaluate the risks, negotiate from strength and give clear advice.
The client’s job is to make the final decision about settlement.
Good personal injury representation requires both.
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