What is a "settlement statement" in a Tennessee wrongful death or personal injury case?
A settlement statement, sometimes called by other names such as a "distribution statement," shows the receipt of monies by a lawyer as part of a settlement and then describes how those monies are paid to the client and others.
These type of statements have been used by good lawyers for years and are now required by the Rules of Professional Conduct applicable to Tennessee lawyers. Here is the relevant language of Rule 1.5 (c): "Upon conclusion of a contingent fee matter, the lawyer shall provide the client with a written statement stating the outcome of the matter and, if there is a recovery, showing the remittance to the client and the method of its determination."
So, assume that personal injury case is settled for $50,000. The settlement statement would show the receipt of those funds by the lawyer. Then, it would set out how that money would be distributed. Likely distributions would include:
- repayment of money to a health insurer who paid medical bills in connection with the injuries in connection with the incident.
- payment of any outstanding medical bills arising from the incident.
- attorneys’ fees
- attorney expenses (for payment of expenses incurred in the prosecution of the case)
- monies payable to the client.
It is possible that the settlement statement will show a reserve for additional expenses. For example, assume that the lawyer took a deposition in the case shortly before the case settled buy has not received a bill from the court reporter who took the deposition. The lawyer may estimate the amount of the bill and withhold that money from the settlement proceeds. After the court reporter bill is received and paid, the lawyer should refund any remaining funds to the client.
You should review your settlement statement and make sure you understand the use of the proceeds of your settlement. An experienced personal injury attorney will be able to explain each of the entries to you.