In some cases, a health insurance company, medical provider or medical service has imposed a lien against the proceeds of a personal injury case. The effect of this lien requires the lawyer to pay the lienholder the amount due from the money received in any settlement or from any judgment recovered at the end of a trial.
Thus, for example, if Sally incurs $15,000 in medical treatment bills with her insurance company, and the company imposes a lien on Sally’s personal injury case, the lawyer will be obligated to satisfy the lien from the proceeds of any settlement or judgment.
What if the lawyer fails to do so? If the attorney overlooks the lien, he may find himself personally obligated to satisfy it. Because the very purpose of the lien is to prevent the disbursement of the settlement funds without the lienholder getting paid, any disbursement that ignores the lienholder may result in a claim against the lawyer or his law firm.