How much money will I get after your expenses and attorney fee?
That's the most important question you need to know.
Want to know why?
Because that will help you make an educated decision about whether the settlement offer is right for you.
When the defense makes an offer, assuming it's a substantial offer, it can be exciting.
It can be confusing.
It can be thrilling knowing that your case is almost over.
Knowing that you may avoid having to go to trial.
All these thoughts will run through your mind when your lawyer calls you to tell you about the offer he just received.
But just like you wouldn't blindly pay a restaurant bill without first looking at the bill to make sure it was accurate, you want to understand just what exactly this offer is.
Are there any conditions or stipulations that go along with the offer of money?
Are you required to keep quiet about any settlement, if you agree to it?
When will you receive this money?
Will you have to pay taxes on the full amount?
Will you have to pay taxes on any part of it?
These questions and more will arise after you've hung up the phone with your lawyer.
You are thrilled.
You're also angry and confused.
You feel your case is worth much more than just one million dollars.
In fact, you think your case is worth between $5 million and $10 million dollars.
Your lawyer tends to agree with you.
You want to know if this is their one and only offer.
"Will they offer more, as we get closer to trial?" you ask hopefully.
Your lawyer tells you that the defense lawyer has hinted there may be some more to negotiate with but he claims to have something against you that will ruin your credibility at trial.
That takes you on a discussion that lasts for over thirty minutes.
You may in fact have something in your past that could jeopardize your crediblity.
Maybe you told a little white lie during your deposition and now it's going to be exposed at trial.
Maybe you failed to disclose some facts to your treating doctors and there are inconsistencies about your medical history.
He's actually spent $25,000 of his law firm's money so far.
If you go to trial, he will likely spend another $50,000 for medical experts, trial exhibits and trial transcripts.
Remember, even with good medical experts and such a large investment of his own money, time, energy and resources, there's no guarantee you'll win.
There's no guarantee you'll get more than what's being offered now.
You could get less.
You could get more.
You could get the same amount.
Ok, so your lawyer will get his expenses repaid to him and his law firm from that $1 million dollars.
That leaves $975,000.
But you don't get that amount either.
Because you need to pay your attorney for the hundreds and thousands of hours he has invested into your case to prosecute it.
When you hired your lawyer, you didn't have to pay him an hourly fee.
This was your agreement with him.
He'd spend his time working on your case.
He'd spend his money working on your case.
He'd spend his resources working on your case.
In exchange, IF you were successful, either by a settlement or by jury verdict and appeal, then and ONLY then would he get paid.
How would he get paid?
As a percentage of what he was able to recover for you.
Legally, that's called a contingency fee.
That means your attorney's fee is contingent upon you successfully resolving your case.
That means your lawyer ONLY gets paid IF you get money.
That means that in New York, the amount your lawyer gets is set by law.
You can't haggle with him over his fee.
You can't choose your lawyer based on who gives you a lower attorney fee.
The fee is the same no matter which lawyer you go to.
In NY, medical malpractice lawyers work on a sliding scale.
That really means that your lawyer gets a fraction of whatever you recover.
Ok, that's all good and well, and you realize your lawyer is entitled to a fee.
But now, when you're presented with a million dollar offer, exactly how much will you get after his expenses and his fee?
You're trying to calculate this in your head.
But there are unknowns as you talk to your lawyer.
He doesn't know the exact amount of his expenses yet.
He has to check his file to tell you exactly.
Then, from the remaining amount, he has to calculate the percentage.
Again, he can only do that once he knows exactly what his expenses are up to this point.
On a million dollar settlement, the fee may be only 23%.
If you obtain let's say a $5 million dollar settlement, the attorney's fee could be a total of 15%. It could be more or less depending on the amount of legal expenses on your case. Also, if you have received Medicare or Medicaid, your lawyer will need to negotiate with those agencies to try and reduce the amount of money you will be required to repay before you ever see a dime.
Try calculating all that in your head when your lawyer calls to tell you about this initial settlement offer.
The bottom line is that you won't be able to.
There are too many unknowns at this point.
You need more information.
You need to know the bottom line number or an approximate bottom line before you can make an educated decision about whether this settlement offer is right for you. The only way to know this is to ask me the most important question...
How much money will I get after all your expenses, after your legal fee and after any liens are paid back?
That's really what you want to know, isn't it?