Few things test patience like a personal injury case that drags on for years while medical bills keep arriving. California’s 36-month charge cap changes part of that equation for plaintiffs, and it deserves a clear explanation. The rule comes from AB 931, the state’s Consumer Legal Funding Act, and it places a firm limit on how long charges can keep building on a funding agreement after you receive an advance. If you have ever wondered why personal injury cases can drag on for years, you already understand the exact problem this protection was written to address.
This is a consumer safeguard, not a product feature. It matters most for people whose cases move slowly, because the longer a case takes, the more a time limit on charges can help. What follows covers what the cap does, what it does not do, and why it works in your favor on a case that stretches well past the usual timeline.
What the 36-month charge cap does
Under AB 931, charges on a legal funding agreement cannot accrue beyond 36 months measured from the funding date. The clock starts when the funds reach you, not when you sign and not when your case eventually resolves. That single detail carries real weight, because a case that settles in eight months and a case that settles in five years sit in very different positions under this rule.
Here is the practical shape of it. Once you cross the 36-month mark from disbursement, the accrual period ends. Additional months of waiting after that point do not keep adding settlement funding charges under the agreement. Picture two plaintiffs who each accept the same advance on the same day. One resolves the matter inside a year and never approaches the boundary. The other faces repeated delays, a crowded court calendar, and an insurer in no hurry to pay. For that second plaintiff, the accrual window still closes at 36 months, no matter how many more months the case needs to reach a resolution. For a plaintiff staring down a slow docket in California, that boundary is worth understanding early.
The practical takeaway is simple: write down your funding date and keep it somewhere easy to find. Every part of this protection is measured from that date, so it is the number that matters most when you check where you stand.
What the cap does not do
This is where honest framing counts, because it is easy to read too much into a headline. A legal funding fees cap limits how long charges accrue. It does not rewrite the rest of your agreement, and it is not a promise of zero cost.
- It does not make funding free. Charges still apply within the covered period, and you should expect them.
- It does not set your total obligation on its own. This legal funding fees cap governs timing, not the full figure you may owe.
- Your maximum obligation appears separately in the contract. AB 931 requires a stated maximum, and that clause, not the time limit, tells you the ceiling on what you could repay from your proceeds.
Read those two provisions side by side. The time limit and the stated-maximum clause work together, and you only see the full picture when you look at both. Anyone comparing pre-settlement funding fees across different offers should confirm where each contract states its maximum, then confirm how the accrual window is defined and when it begins. Two agreements can share the same 36-month boundary and still reach very different totals, so the stated maximum deserves as much attention as the timing rule. A contract that spells out both clearly gives you a fair basis for comparison.
Why the cap works in your favor on long cases
The value of this rule grows with the length of your case. On a matter that resolves quickly, you may never reach the boundary. On a case that pushes past three years, accrual simply stops at the cap, and the extra waiting no longer adds to what builds under the agreement. That is a meaningful form of predictability at a time when very little about a lawsuit feels predictable.
Predictability has practical value when you are trying to plan a household budget around an uncertain timeline. Many plaintiffs turn to funding precisely because they need financial relief while a case is still pending, and knowing that a lawsuit funding cost cap ends the accrual window helps you plan for the long stretch ahead rather than bracing for charges that grow without end. Paired with the five-business-day cancellation right that AB 931 also guarantees, you get flexibility at the very start of the agreement and a firm limit on the accrual period across the life of it. Early flexibility and a fixed accrual window address two different worries: one at signing, one over the years that may follow.
There is a reason this matters so much for people still waiting on their settlement money. Long cases are where uncertainty compounds, and a settlement funding charges limit gives you one fixed point to plan around. It will not speed up your case, and it will not remove the cost of funding, but it does close the door on open-ended accrual. The longer your case runs in California, the more this cap tends to work in your favor.
What You Should Know
The 36-month charge cap is a timing protection. It caps how long charges can accrue from your funding date, it does not make funding free, and it does not set your total obligation by itself. To read your agreement well, look at the accrual window and the stated maximum together, and note your funding date so you always know where you stand. This pre-settlement funding fees structure is one of several consumer protections California built into AB 931, and understanding it puts you in a stronger position while you wait.
Fund Capital America works with plaintiffs, attorneys, and medical providers across California and can walk you through how these terms apply to your situation before you sign anything. If your case is moving slowly and you want a clear read on your options, our team is ready to help you understand a lawsuit funding cost cap and the rest of your agreement in plain language.
Who is Fund Capital America?
Since 2006, Fund Capital America (FCA) has been a trusted leader in pre-settlement funding, providing cash advance loans to plaintiffs in personal injury and accident cases. Over the years, FCA has proudly served thousands of law firms and tens of thousands of clients, helping them navigate the financial challenges of litigation. While our core service is pre-settlement funding, we also offer a comprehensive range of services to support law firms and their clients from the beginning of the case to the final settlement check distribution.
Fund Capital America’s Services
In addition to pre-settlement funding, FCA provides a broad array of services designed to alleviate the financial and administrative burdens on injury victims, law firms, and medical professionals. Our services include:
- Pre Settlement Funding
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- Language Services
- Investigation Services
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- Law Firm Line of Credit
- Medical Receivables Financing
- Law Firm Services
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