By Michael Shemtoub, trial attorney, Beverly Law. Updated November 2026.
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The contract follows the claim
The funding contract is tied to the proceeds of your claim, not to the lawyer handling it. These state statutes spell this out:
| State | What the statute says |
|---|---|
| California | The contract “shall remain valid and enforceable in the event the consumer terminates the attorney who made the attestation” (Bus. & Prof. Code 6251(e)) |
| Illinois | “The contract remains valid and enforceable if the consumer terminates representation by the initial attorney,” including when you retain a new attorney (815 ILCS 121/10(c)) |
| New York | The contract “shall remain valid and enforceable in the event the consumer terminates the initial attorney” (Fin. Serv. Law 1002(C), added by A.9442) |
| Nevada | The contract “shall remain valid if the consumer terminates the representation of the initial attorney” (NRS 604C.350) |
| Kansas | The contract “shall remain valid and enforceable if the consumer terminates the relationship with the initial attorney” (2026 Kan. Sess. Laws ch. 130, sec. 3(e)) |
In states without a statute, the contract’s own terms decide. Read its clause on a change of lawyer before you switch.
The choice to switch stays yours. California bars a funder from offering money “on the condition that a consumer that is represented by counsel terminate that representation and adopt counsel recommended by the consumer legal funding company” (section 6254(a)(9)). Our page on whether a funder can control your case covers the other limits.
What your new lawyer will need
In acknowledgment states, your first lawyer signed a statement that the settlement would run through the trust account and that the lawyer would pay the company as the contract says. California’s version includes the lawyer’s agreement to disburse the money as the contract says and to take the steps needed to carry out its terms (section 6251(c)(4)). Your new lawyer never signed that, and the statutes we read do not say whether a new acknowledgment is required after a switch. The funder may ask your new lawyer for written confirmation that it will be paid from the proceeds.
Missouri’s law is built around notice to “the consumer’s attorney”: the funder must send written notice of the contract within three business days of funding, and you must give your attorney a “nonrevocable written direction” to tell the funder when the case resolves (RSMo 436.554). The statute does not address a change of attorney, so make sure the funder’s notice and your direction reach the new lawyer.
Give your new lawyer the full funding contract, any amendments, the current payoff schedule and the funder’s contact information on day one. More on the acknowledgment itself is on our page about whether your lawyer has to sign.
Your first lawyer’s claim for fees
A lawyer you let go may still be owed something. California’s Supreme Court held in Fracasse v. Brent, 6 Cal.3d 784 (1972) that a client has “the power and the right at any time to discharge his attorney with or without cause.” A discharged lawyer working on contingency is limited to “the reasonable value of his services rendered to the time of discharge,” known as quantum meruit, and that claim “does not accrue until the occurrence of the stated contingency.” If the case is lost, there is usually nothing to collect.
Washington gives a lawyer a lien for compensation on money in the lawyer’s hands belonging to the client, on money in the other side’s hands after notice, and on the action and its proceeds after it is filed (RCW 60.40.010). Other states have their own lien rules. Ask your new lawyer how any fee owed to the old lawyer will be handled. For how contingency fees are usually set, see what percentage accident lawyers take.
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Who gets paid first when claims collide
At settlement, the old lawyer, the new lawyer, the funder, medical lienholders and you may all claim part of the same money. Ethics rules tell the lawyer holding it what to do while a dispute is open. In California, if “a client or other person disputes the lawyer or law firm’s right to receive a portion of trust funds, the disputed portion shall not be withdrawn until the dispute is finally resolved,” and the lawyer must “promptly distribute” undisputed funds (Cal. Rule of Prof. Conduct 1.15(c)(2), (d)(7)). Washington requires the lawyer to keep disputed property in trust, distribute the rest promptly and take reasonable steps to resolve the dispute, “including, when appropriate, interpleading the disputed funds” (RPC 1.15A(g)). Interpleader means asking a court to decide who gets the money.
Few statutes rank the funder against lawyers. West Virginia is one: the funder’s lien ranks behind attorney liens and several other liens (W. Va. Code 46A-6N-8). Elsewhere the order depends on the contract, the date each claim attached and local lien law, explained on our page about funding and medical liens.
What this means for you
- Tell your funder in writing when you change lawyers, and give it the new lawyer’s name.
- Ask the new lawyer how the old lawyer’s fee will be handled and whether it changes your net recovery.
- A switch can add time to the case, and time-based contracts grow with it. Ask the funder for a current payoff schedule; our page on paying an advance off early explains how those steps work.
- Ask that disputed amounts stay in trust while the rest of your money is paid out.
Common questions
Does my funding contract end if I fire my lawyer?
Not under the California, Illinois, New York, Nevada and Kansas statutes. In other states, check the contract’s clause on a change of lawyer.
Does my new lawyer have to agree to pay the funder?
The statutes we read do not say a new acknowledgment is required after a switch, but the funder may ask for written confirmation, and trust account rules such as Washington’s RPC 1.15A(f) cover money a third person is entitled to receive.
Will I pay two lawyers?
Your first lawyer may have a claim for the reasonable value of work done. How that is split with the new lawyer’s fee depends on the fee agreements and state law, so ask the new lawyer before you sign with them.
Can the funding company make me change lawyers?
In California a funder may not condition funding on you firing your lawyer and hiring one it recommends.
What if the funder and my old lawyer both claim the same money?
The lawyer holding the settlement keeps the disputed part in trust and pays out the rest, and a court can decide the dispute if needed. The lawsuit cash advance guide links every page in this section. Beverly Law does not offer or arrange lawsuit funding and receives no payment from funding companies. Beverly Law offers a free case review in English or Spanish at (310) 552-6959 if you have questions about your injury case. You owe no fees or costs unless we win.
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Related pages
Cash advance on a lawsuit · Laws by state · Injury law FAQs
Sources
- California AB 931 chaptered text, Bus. & Prof. Code 6251 and 6254 (CalMatters Digital Democracy) (calmatters.digitaldemocracy.org)
- Bus. & Prof. Code 6251 (Justia, 2025 California Code) (law.justia.com)
- New York A.9442 (L. 2026, ch. 11), Financial Services Law art. 10 (nysenate.gov)
- Illinois Consumer Legal Funding Act, 815 ILCS 121 (ilga.gov)
- Nevada NRS Chapter 604C (leg.state.nv.us)
- Kansas HB 2518 (2026 Sess. Laws ch. 130) (kssos.org)
- Missouri RSMo 436.554 (revisor.mo.gov)
- Fracasse v. Brent, 6 Cal.3d 784 (1972) (Justia) (law.justia.com)
- RCW 60.40.010, attorney's lien (Washington State Legislature) (app.leg.wa.gov)
- California Rules of Professional Conduct, Rule 1.15 (calbar.ca.gov)
- Washington RPC 1.15A (Washington Courts) (courts.wa.gov)
- West Virginia Code 46A-6N-8 (code.wvlegislature.gov)
Important: This page is general information, not legal or medical advice, and reading it does not create an attorney-client relationship. Every case is different; talk to a lawyer about yours. Texas cases are handled by the firm’s Texas-licensed attorneys, Joyce Ondich and John Efstathiou. Last reviewed: November 7, 2026.