>>- both files have to be from the same Plaintiff (field Plaintf_ID)
>>- files cannot be the same File_Type (one must be a "P" and the other a "D")
>>- File_ID is the primary key
>>- PartFile is the table that holds one record for each "file" (law firms sometimes call this a "matter")

I'm expecting you could do this with a self-join along the lines of

SELECT ;
   P.Plaintf_ID, P.File_ID, P.Lastname, P.Firstname, P.Partner, P.Our_FileNo, P.Plain_Defn ;
  from partfile P inner join partfile D on P.Plaintf_ID=D.Plaintf_ID and P.file_type='P' and D.file_type='D' ;
  where P.settled=.T. and empty(D.date_fund) and empty(D.date_closd) ;
   INTO CURSOR SettledNF READWRITE

You'd need to refine the WHERE clause to match exact settled/funded requirements for the P and D files, but that ought to be easy enough.

Also note that some people would consider the join to be overloaded, with file_type clauses best moved to the WHERE, but I don't think this affects Rushmore and I find it more legible. You might want to experiment with join versus where if the query is slow.