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John Bair
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A ‘Family Office’ for the Plaintiff: The Value of a Settlement Planner

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It is common to hear lawyers assert:

"I haven't done a structure in 10 years."

"The defense is providing a broker."

"My client wants all of their cash now."

"My client just doesn't need a settlement planner."

Litigation is a high-stakes time for both attorney and client. Each lawsuit is inherently different, with unique complications and questions that create roadblocks to a successful recovery. The enterprise of seeking recovery through litigation requires many major financial decisions. For example, have you ever asked:

Will my client need a non-recourse loan to fund the lawsuit? How do they get a non-recourse loan?

The scope of the lawsuit is larger than expected–where can my law firm get a competitive line of credit?

When does it make sense for primary caregivers to hire an agency for attendant care or conversely, to hire directly, incorporate, and provide workers' compensation for a few employees?

My client is disabled–where should their family purchase a home? Who should they hire to modify the home?

Should my client's family establish a trust, and if so, which kind? Who should be the trustee?

When must my client establish a Medicare Set-aside account? Should we consider an administration firm for that arrangement?

Uncovering answers to these questions is a difficult and time-intensive process. You should expect this type of knowledge and expertise from the settlement planner you choose to retain.

Settlement planning is an extension of litigation, and has everything to do with making a recovery successful in the present, and perhaps even more importantly–successful for the future.

Think in terms of a family office. Families with a great deal of prosperity often employ a family office to manage and preserve their wealth. These businesses offer a range of specialists, including tax analysts, CPAs, portfolio and investment managers, wealth planners, trust officers and legal advisors.

A comprehensive settlement planning firm provides your client with this same concierge-type approach. They will have the appropriate licensure and appointments to act as broker of record, should there be a need to structure. They will perform the due diligence to assess the plaintiff's future needs and financial goals, and then use that information to develop a settlement plan.

Let's examine the work of the settlement planner:

  1. Prior to settlement, assist the plaintiff and the attorney in building a framework of knowledge so that both parties understand the critical subject matter needed to make sound settlement decisions.
  2. Be an advocate for the plaintiff and their attorney in managing the financial challenges presented by settlement: repayment of non-recourse funding, dealing with liens, resolving marital disputes and preserving government benefits and programs (i.e. Medicare, Medicaid, SSI, food stamps, Section 8 housing, etc.)
  3. Examine and provide due diligence with regards to investment management, and steward the assets recovered in settlement for long periods of time. Take into consideration taxes, fees, market risk and the potential longevity of the injured party's income needs.
  4. Develop a structured annuity when appropriate and include it as part of an overall plan. Ensure that important points of distinction have been disclosed to the plaintiff and confirm that the structure is properly included in the terms of settlement.
  5. If applicable, interview trust officers and trust companies and develop recommendations for the plaintiff based on an assessment of the professionalism, fees and framework of trust partnerships.
  6. Explore fiduciary controls available within trust solutions that will enable care for minors, disabled children, and disabled adult children. Consider the totality of the family's needs and then juxtapose those needs with the universe of financial, legal and insurance solutions to arrive at a "best practice" recommendation on how to achieve and sustain financial security.

By recognizing settlement planning as the next logical step in the continuum of advice, you do your client the service of providing support long before and long after the settlement is reached.

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Related Posts:

A Simple Change for the Better

Dissipation of Funds: How the 'Popcorn Lung' Case Demonstrates a Significant Post-Settlement Risk

Knowing Your Client: 3 Ways to Avoid Financial Pitfalls in Litigation

1 Comment

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  1. Vern Dennis says:
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    Good advice and food for thought, although most plaintiffs and their counsel just want money now and tend to the planning later, if ever

    I did know of one personal injury attorney, about five years short of retiring, who wanted his fees structured whenever possible

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