How Long Can a Lawyer Hold Your Settlement Check?

Attorneys must disburse settlement funds promptly — typically within three to five business days of check clearance. Longer delays require a legitimate reason and should be communicated to the client.

Attorneys are generally required to disburse settlement funds to clients within a reasonable time after the funds are received and cleared — typically defined as three to five business days in most state bar rules, though the specific standard varies by jurisdiction. Funds must be held in a trust account (IOLTA) during this period and cannot be commingled with the attorney's own funds.

Legitimate reasons for delays beyond the standard clearance period include: outstanding medical liens that require formal resolution before disbursement (the lien amount must be confirmed in writing before distribution), Medicare or Medicaid lien negotiations (federal lien resolution processes can take additional weeks), disputes about attorney fees or expenses between the plaintiff and the attorney, and in wrongful death or minor's settlement cases, required court approval before funds can be distributed.

If your settlement check has been received by your attorney and significant time has passed without a disbursement explanation, contact your attorney's office directly and ask for a specific timeline and an explanation of any outstanding items. A written settlement statement — showing all deductions and the expected net disbursement — should be provided to you before or at the time of distribution.

If you believe your attorney is improperly withholding your settlement funds without a legitimate reason, this is a serious professional responsibility issue. You can contact your state's bar association to file a complaint. Most state bars have client protection funds to address situations where attorneys misappropriate or delay client funds.

Source: ABA Model Rule of Professional Conduct 1.15 — Safekeeping Property. State-specific promptness standards vary; consult your state bar rules.

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