Prompt Payment Required in Illinois Personal Injury Settlements

Prompt Payment Required in Illinois Personal Injury Settlements

By James Bizzieri 

Earlier this year, the Illinois General Assembly passed 736 ILCS 5/2-2301, requiring defendants and insurance companies settling personal injury cases to pay all sums due to the plaintiff agreed upon during negotiations within 30 days of signing the settlement documents. This rule of civil procedure went into effect on January 1^st and was passed in response to concerns over delayed payments issued to injured parties, which sometimes would take up to 6 months longer than the deadline in the settlement agreed to by the parties. The law pertains to lawsuits regarding personal injury, damage to property, wrongful death, or other tort actions.

What the Law Means for You

According to this law, which does not apply to class action suits or cases involving the state or its agents or employees, a defendant in a personal injury suit has 14 days from the date on which a written confirmation of settlement has been exchanged to present a proposed release to the plaintiff. A release is a document in which the plaintiff agrees to give up any legal right to sue or continue a case against the defendant in exchange for payment of a settlement or other agreed upon benefit. Once the plaintiff and plaintiff’s attorney agree to the language stipulated in the document, it is signed by the plaintiff and returned to the defendant and defendant’s attorney. Once the signed agreement is received personally or via USPS mail return receipt, the defendant has up to 30 days to pay. Failure to pay within the 30 days may result in the court rendering judgment against the defendant in the amount set forth in the release, plus costs of obtaining the judgment and interest from the date of delivery of release by plaintiff.

Similarly, the statute also concerns the delay of payment issues regarding liens against plaintiffs from Medicare, Medicaid, health care providers and health care insurance companies. These programs and parties have a “super lien” on judgments issued or settlements reached from a third party for medical bills resulting from the defendant’s negligence – meaning their interests are protected and take priority. As such, parties to a settlement or judgment must pay the lien prior to disbursing funds. Failure to pay off a lien – or even failure to ascertain that one exists – may result in penalties and fines against all the parties to the case, including attorneys and insurers. Often times, payments to plaintiffs were delayed as much as six months to one year because of these liens. The new law now provides more legal options: if the plaintiff instructs the defendant to hold the settlement funds in the trust fund of either party’s attorney until the lien is exonerated – or provides the defendant with another manner in which to resolve the lien(s) – the 30-day requirement of payment will not be delayed.

Contact an Experienced Chicago Attorney

Personal injury law is complicated. An experienced and skilled attorney is needed to handle the case, particularly during settlement negotiations. Contact a Chicago area personal injury attorney today for a consultation. If you have been injured due to the negligence or wrongdoing of another, a personal injury attorney at Bizzieri Law Offices can guide you through the entire process and obtain monetary damages to which you may be entitled.