Important Ethics Opinion for Illinois Attorneys and Personal Injury Settlements

Here’s a common situation in the personal injury context: Plaintiff’s attorney negotiates settlement with the defendant’s insurance company. The parties strike a deal, but only on the condition that the plaintiff’s attorney guarantee to pay all liens and subrogation interests out of the settlement proceeds. No problem, especially since the attorney would pay the liens and subrogation interests anyway, right?


 An Ethics Opinion that was issued in July 2006 says that Illinois attorneys may NOT guarantee that liens/subros will be paid back out of settlement proceeds.

 So what do you do instead? Typically I will tell insurance adjusters that I can’t personally guarantee payment, but that my policy always has been and always will be to pay liens and subrogation interests out of settlement proceeds. So far, I haven’t had a problem… but I know I’ll have one of those cases someday where the insurance company ends up sending a bunch of checks for each lienholder – which is a pain.

How do other attorneys deal with this? Comments would be appreciated.


Filed under Illinois Case Law, Law Practice Management, Negotiations, Settlements

2 responses to “Important Ethics Opinion for Illinois Attorneys and Personal Injury Settlements

  1. In Wisconsin, Personal Injury Attorneys have an ethical duty (according to some state ethics gurus) and probably a duty under Supreme Court Rules to pay liens once the lawyer is put on notice. I wrote an article about this. I’ll try to put it on my blog: There was also a case decided by the Wisconsin Supreme Court that held an attorney responsible to pay such a lien.


  2. I love to read such informative articles. It is good to know what went wrong in which part of the world.. even in distant places, where we do not ever plan to physically visit, we visit there virtually and analyse the complete scene. Thanks for this piece of information to add to my experience! To share my other experiences too, recently, I have come across an article on how efficiently law firms get you the justice, which otherwise, sometimes, gets next to impossible. While reading, I realized how important it is to contact a lawyer whenever you get stuck with any legal related issues. And a family lawyer does not in any way decreases the importance of keeping an international law firms directory handy.

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