Practice Pitfalls: Beware the Desperate Client in a Personal Injury Matter

In the September 2010 issue of LAWPRO Magazine, we asked our claims counsel about what they feel are the biggest malpractice hazards in each area of law based on the claims files they work on every day. Here is an excerpt from that article dealing with clients who urge a quick settlement. Click here to read the full article “Practice Pitfalls”.

“Many plaintiffs’ lawyers fall victim to clients who desperately need money in the early stages of a personal injury lawsuit,” says Cynthia Miller, Unit Director & Counsel (Litigation) at LAWPRO. “So they settle the client’s statutory accident benefits claim early on for a lump sum and have the parallel tort action continue.”

But senior, experienced members of the plaintiffs’ personal injury bar strongly advise against this course of action, Martin says.

“Accident benefits can be quite extensive, but lawyers will sometimes settle for benefits of only $25,000 in a catastrophic injury case where the client could have received hundreds of thousands of dollars of benefits over a lifetime.”

Urged to settle by a desperate client, lawyers will take what they can get on a rush basis from the insurer instead of taking the time to properly investigate and “work up” the accident benefits claim by engaging the expertise of the appropriate medical practitioners.

“And then the tort defendant, later in the day, will challenge the fact that they’ve compromised some of the benefits, because they’re going to try to stick them on the tort insurer,” says Martin.

If the client insists on such a settlement in spite of the lawyer’s advice, the lawyer should clearly explain the consequences in writing and thoroughly document the settlement instructions.

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