Many personal injury lawsuits end in a settlement. Unfortunately, a settlement with the defendant is not always the clean conclusion to the legal debate that many plaintiffs expect. In fact, many times plaintiff find themselves embroiled in a post-settlement to receive the settlement funds – but that all should end soon due to a new Illinois designed to simplify the collection of settlement funds.
On August 26, 2013, Illinois Gov. Pat Quinn signed into law Public Act 098-0548, which amends the Illinois Code of Civil Procedure to create a new statutory requirements designed to simplify the collection of civil settlements. Specifically, the new statute – 735 ILCS 5/2-2301 (Section 2301) – provides deadlines for exchanging settlement documents and payment after a civil lawsuit is settled.
Within 14 days of the confirmation of the settlement, the settling defendant must tender a release to the plaintiff. Thereafter, the defendant must provide the agreed-upon settlement sum in full within 30 days of the date of tender of the signed release and lien protection letters. If court approval of the settlement is required, the plaintiff is required to obtain the court order and tender it to the defendant before the clock will begin to run on the defendant’s payment obligations.
Perhaps, most notably, however, is the way that the law addresses the legal morass of third-party subrogation claims and liens, such as attorney’s liens, health-care provider liens, or Medicaid or Medicare liens, that can make it difficult for plaintiff’s to obtain their settlement award. In these situations, the law allows plaintiffs to protect the third party’s rights by tendering to the defendant a signed release of the lien, whether the attorney’s lien or a health care provider’s lien. Alternatively, the plaintiff can provide a letter from his or her attorney agreeing to hold the full amount of the claimed right to recovery in the attorney’s client fund account pending final resolution of the amount of the right to recovery. Upon receipt of these documents, the full amount of the settlement funds must be released to the plaintiff, ultimately getting the plaintiff the money that he or she deserves more quickly and efficiently.
The new law, which will go into effect January, 1, 2014, applies to settlements reached in personal injury lawsuits, wrongful death cases, and other tort claims for money damages. However, the law does not apply to settlements with certain government entities, including the State of Illinois, state agencies, state employees, municipalities, and local governments, nor does the law apply to settlements reached in class action lawsuits.
The Chicago accident and injury attorneys at Cogan & Power, P.C. commend the Illinois legislature on passing this new law as it will go a long way in getting personal injury victims the money that they need and deserve more quickly and efficiently, without additional post-settlement legal battles.
Contact the Chicago personal injury lawyers at Cogan & Power, P.C. to learn more about the new settlement collection law or to schedule a consultation with one of our dedicated Chicago accident and injury lawyers.