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Bar News - September 18, 2009


Professional Liability: Dealing with a Mistake in Handling a Client’s Matter

By:

There is no stomach-churning sensation like the one you get when you realize you may have made an error in a client’s matter. Overcoming that feeling, and acting appropriately, can help protect not only this year’s bottom line for your firm, but your license.

  • First: Strive to stay calm. Fight the inclination to hope the issue will simply go away. Your clients pay you to dispassionately assess legal issues and situations; apply some of that training to this fact pattern.

  • Second: Get another’s counsel. A lawyer who represents herself has a fool for a client. You’ve heard that – don’t be the poster child who proves it.

    There are a variety of sources for this counsel. Big firms frequently have in-house counsel of their own; smaller firms have risk management partners, or at least grey-haired sages.

    If you’re on your own as a solo, you may need to draw on a friend or an outside mentor whose judgment you trust. Consider formally engaging the person so your discussions will be privileged.

  • Third: Think before you act. The ABA’s Standing Committee on Lawyers’ Professional Liability recommends, in these situations, that you ask yourself three questions: (1) did I make an error that can affect my client’s interests; (2) but for this mistake, would my client’s interests have been better off; and (3) can I fix this error?

    If you lack the resources to help you with this analysis, check with your insurance broker: she may be able to help. Several carriers have hotlines specifically set up to help answer these questions, for example.

  • Fourth: Act, not in haste, but without delay. Consider whether you can correct the mistake or mitigate its effect by some simple action. For example, have you miscalculated the deadline to oppose a motion for summary judgment by one day? Call your opposing counsel. A polite request for a one-day extension of time may solve the problem.

  • Fifth: Should you notify the carrier? You’ll need to look at the policy to know what’s contractually required of you. There are common law standards that have evolved in further interpreting your reporting obligations, which we’ll discuss in a future article. Consult your broker on whom to contact, and how. Usually it’s by telephone.

    Follow up with a letter, supplying as much detail as possible. Early notification serves two purposes: first, experience shows that claims can be satisfied much less expensively when fresh; second, and consequently, you increase your likelihood of policy renewal by divulging your errors early.

  • Sixth: Notify your client. While failing to report a potential claim to your carrier may result in a denial of coverage, failing to notify your client may subject you to bar discipline.

    Further, legal malpractice statistics consistently confirm that former clients are less inclined to sue their lawyers over bad news if the lawyers come right out and share that bad news.

    In addition to the threat of discipline and the increased likelihood of a malpractice claim, failing to notify your client may toll the statute of limitations.

  • Finally: Take steps to minimize the pain. You can do things now that will help you should you one day realize you’ve made a mistake. Store all your insurance policies in a single, readily identifiable location. Confirm the current contact information for your carrier and your broker, and place that information with the policy. Then attach a memo to yourself on how to respond to an error and a claim. And, if and when necessary, use the telephone numbers for assistance in evaluating the seriousness of a situation in which you find yourself.

William C. Saturley and John C. Kissinger, Jr. practice in the commercial litigation and professional malpractice groups at Nelson, Kinder, Mosseau & Saturley, P.C. in Manchester and Boston. A version of this article first appeared in Massachusetts Lawyers Weekly.

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