Insurance for Lawyers

Posted on June 2, 2015 03:57 by Steve Crislip

We advise, defend, and prosecute insurance-related claims regularly. Lawyers sometimes do not pay close enough attention to their own coverages, however.  You should have a basic system to review and check all your coverages on a regular basis.  We were trained as lawyers, not business owners.

Recently an Illinois Supreme Court case (Ill. State Bar Ass’n Mutual Ins. Co. v. Law Office of Tyzzolino & Terpinas, 2015 BL 44614, Ill. 117096, 2/20/15, released 3/31/15) invalidated the firm’s professional liability policy for all the lawyers when one of the lawyers falsely denied knowing of any circumstances that might led to a malpractice claim. The court took away the coverage of the other lawyers and denied them the “innocent insured” doctrine.  Frequently claims against a firm arise out of the acts of a “lone wolf” doing things unknown to the others.  Here, the application process was flawed by just one lawyer not being truthful.  I have often said in law practice, you really do become your brother’s and sister’s keeper.

To maintain a modern practice, you should protect yourself with coverage. Often without regard to facts or legal basis, claims get made.  Of course, mistakes often happen.  You do not want to risk your likelihood and your assets by not having adequate coverage, whether it is general liability, employment practices, errors and omissions, or cyber insurance.

With regard to the legal malpractice coverage part, speakers at the National Legal Malpractice Conference in Washington, D.C. recently emphasized that timing is everything.  With claims made and reported coverage, the covered act needs to have occurred during the policy period and the claim reported within the period.  So, you need to know if a “claim” has been made to one of your lawyers and need to know how and when to report it.  You need to see your policy and make sure you have timely reported, with the required specificity.  In my view, that requires some looking and asking in a firm and the establishment of a culture where concealment is not tolerated.

I can see staff, or your outside agents or brokers, handling some of your insurance requirements.  With the important professional liability coverage, I suggest you need knowledgeable lawyers and a required overview of the other lawyers.  I find lawyers to be an independent lot who often chaff at oversight of them.  The issues are too important to leave to a laissez faire approach. You really need a strong loss prevention culture in your firm, regardless of its size.  Part of that is the oversight on coverage and the individual accountability of reporting a claim to others in the firm.  The individual lawyers who gloss over a claim feeling there was no merit to it, or hope it will go away can bring down the house of others. As they said at the end of the annual conference, “Communicate with your carrier and report everything.”  Expensive coverage is better than no insurance.”

This blog was originally posted on Lawyering for Lawyers blog on June 1. Click here to read the original entry. 


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Risks and the Practice of Law

Posted on February 5, 2015 06:27 by Steve Crislip

Getting out of bed involves “risk” which is sometimes described as exposure to some possibility of loss, injury, or other unwelcome circumstance (Oxford English Dictionary). We accept and deal with all manner of risk on a daily basis and the common law standard of not properly addressing such risks was the reasonable man concept as to what was negligent conduct.

We all purposefully take some risks with things like food at the company picnic and investments (standard printed language from all brokers is:“Past performance does not guarantee future results.”). It is all just part of life, but we are always advised to manage our risk and avoid things like known health risks, home and personal security risks, and other known and predictable root causes. Therein lies the foundation of the insurance industry made famous in the small Edward Lloyd’s Coffee Shop (1648-1713) in London when ships and their cargo were “insured” against the risk of loss, later leading to the London insurance market.

So, in the modern world of International Standards (ISO 31000), we seek to take the effect of uncertainty on objectives and use coordinated and economic application of resources to minimize, monitor and control the probability of unfortunate events. Enough: It is what your Momma told you when she said to watch where you were going and pay attention to what you are doing. Without something like ISO, that was Mother’s Risk Management.

Translated to the world of hard-working lawyers with too little time, it is now necessary for you and your firm to start paying more attention to yourself and your own legal risk. The phrase “the cobbler’s children have no shoes” is used to describe the phenomenon when professionals are too busy with their work and clients to look after those close to them [lawyer with no will; the contractor whose house is unfinished; the accountant who was late filing her return].

Most lawyers have the good sense to have errors and omissions coverage, or malpractice coverage, but that is not the real answer. The solution is not to get to that point, which will be costly and painful regardless of the coverage. Risk management in the form of legal loss prevention is the medicine you should take and accept as a business practice. In other words, get the family some shoes.

Intapp, a legal software provider,, sponsored a 2014 Law Firm Risk Survey and inquired of the biggest firms. Some 96 U.S. firms responded on various issues posed. Risks in all size law firms change often and they were interested in seeing these changes since their 2012 survey. They made several observations from their key findings:

-More than half the responding firms were using centralized process to identify and protect HIPAA protected health information.
-Half were planning to upgrade their conflicts software in next 12 18 months in response to those continuing challenges.
-Major concerns of the respondents were conflicts and information security.
-About half reported client audits of the law firm’s security and risk procedures.
-Law firms seemed to have more stringent process for new business than for new matters from existing clients.
-More than half had an organized central arrangement to check conflicts.

Contact: for detailed results.

My purpose in this month’s column is to get more lawyers interested in their own protection against risk in their very own practice.  It is a variation of the biblical proverb: “Physician heal thyself.” When you have the opportunity to control the predictable and likely, you should do so. Treat the time spent with your own loss prevention as productive time, worthy of investment to prevent claims. Admittedly it is hard to measure success in this area, but if you avoid one claim or one deductible, you have actually made money.  Whether you chose a central group, or one person, start this year with a plan to manage your legal risk.

This blog was originally posted on February 3 on Lawyering for Lawyers blog. Click here to read the original entry. 

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I have the good fortune these days to be wearing multiple hats. I am managing partner of my firm; chair of the DRI Law Practice Committee; and, President Elect of the Indianapolis Bar Association. In those roles I have traveled the country speaking to DRI and state defense bar groups, attending ABA and the National Association of Bar President meetings, and attending law practice seminars. I have learned that the sands are shifting under the feet of lawyers and law firms, yet most lawyers are completely oblivious. 

You have heard the term "the future is now?" Well, its true, the future is now. Changes are happening so rapidly in law practice that the changes will pass many lawyers by, and when they wake up to the change, it will be too late for many of them.

So, what are some of the changes? Law is rapidly going paperless, and technology (for those who embrace it) is making it far easier (and cheaper for clients) than ever before. The business and insurance world are moving jobs in house. They are using paraprofessionals and outsourcing to do tasks that lawyers have traditionally done.

Across the country more and more individuals and companies are trying to represent themselves because the internet and e-filing has made law look less confusing to them. As law schools have seen declining enrollment, law grads have seen fewer jobs, recent grads are increasingly hanging out a shingle rather than await a traditional firm or corporate job.

Many of these changes are here to stay. Certain kinds of work, commonly known as "commodity work" will never again command fee increases. The work will go in house, and for the outside lawyers who do it, the profits will be derived from doing the work as efficiently as possible, using technology and paralegal assistance.

My pitch to you, my reader: Do everything you can to stay current on trends; view these changes as an opportunity, not a detriment. Get ahead of the trend line. How do you do it? You attend meetings and seminars and you read everything you can find.

We hope, of course, that you will get involved in the DRI Law Practice Management Committee and help us with our programming and materials. But, that is not enough. I also belong to the ABA Law Practice Committee and find their publications to be fabulous. Every day I read a posting from two free sites, Attorneys at Work and Solo Practice University. While I am not a solo practitioner, I have found that it pays to think like one. Both of these sites have valuable information on a daily basis that I often share with my entire firm. I am also a subscriber to the Remsen Group newsletter where I get cutting edge information on law firm trends.

The bottom line is that it is easy to stay current and it is a MUST if you want to survive and thrive in these changing times. It is not enough for just firm managers to be current. We all need our partners and rising associates to be keeping current so that they are hearing about these changes from someone other than us. Thanks for your time! 

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Math and Loss Prevention

Posted on October 22, 2013 04:18 by Steve Crislip

I must admit that I never knew the name of the rule known as The Pareto Principle, which I had often called the 80/20 rule.  Susan Cartier Liebel, the Founder and CEO of Solo Practice University®, recently used the phrase in an article for ALPS (professional liability carrier) advocating better use of one’s time for marketing and business matters.  It seems Italian economist Vilfredo Pareto observed in 1906 that 80% of the land in Italy was owned by only 20% of the population; he further developed the principle by also observing that 20% of the pea pods in his garden contained 80% of the peas.

I am told business management consultant Joseph M. Juran later suggested the principle and named it after Pareto.  Apparently it is one of those business school concepts founded in math from the law of the vital few, and the principle of factor sparsity and it states that, for many events, roughly 80% of the effects come from 20% of the causes.  Hey, I went to Law School because I was lousy in math.  How does this relate to my law firm’s practice?

Like me, how many times have you heard these statements mentioned?

• 80% of the problems in a firm come from 20% of the people (what happens if you get rid of the smaller percentage?)

• 80% of your profits come from 20% of your customers (maybe concentrate more on the 20%);

• 80% of your complaints come from 20% of your customers (maybe get rid of the 20% complainers)

• 80% of your profits come from 20% of the time you spend (maybe readjust your efforts to the ones supplying most of the profits);

• 80% of your sales come from 20% of your products (maybe eliminate some of the products).

All of this is heady stuff for a math challenged loss prevention lawyer.  I submit there are lessons to be learned here for law firms about efficiency and better use of your time, all by making math your new friend.  Instead of chasing the elusive new start-up, what about providing better service to your client base that gives you 80% of your business?  I and many others preach that good loss prevention makes for very good marketing, so maybe this principle applies there also.

So, in concentrating upon your good clients and better quality of service, why not just get rid of your problem clients who are causing you issues, taking up your time and likely to make claims against you?  Tell the member who represents these pesky high-maintenance and late-paying marginal clients my favorite double entendre:  “We do not deserve to be their lawyers.”  Firing a bad and problematic client, appropriately of course, may just make you feel so much better and be so much better as a firm.  Think of all the available time you will have to better serve the company or individuals paying much of your overhead.  Go make them happy instead of constantly trying to collect from this small group of late-paying and demanding clients who are trouble.  Do not be so bashful — go out there and just fire them as clients.

Likewise, why are you spending time with problem lawyers in your firm who will not turn their time in, will not comply with firm loss prevention policies, cause personnel problems, and on and on?Really, everyone justifies it by saying he/she is a really good lawyer and we just need to work with them.  Sure, but why keep doing it year after year?  Look back over the last year and see who has dominated your firm’s management time, and again ask yourself why keep doing that when most of your lawyers are knocking it out of the park with no required attention (probably 80% of them)?  Bruce MacEwen who writes the legal site Adam Smith, Esq. tells firms to take one of the recurring offenders out and hang them.  The message will be clear and your problem load is lightened.

A little harsh in my old age some may say.  No, it is like snow skiing, where there will be changing terrain and changing conditions.  Times have changed quickly and in the legal profession we need to adapt to the changes much quicker.  The old law firm systems painted over many of these issues in firms and no one dealt with them.  I suggest you better change your methods to deal with these changing conditions or you may appear in a legal blog article on the demise of …..(insert you).  Maybe math can help you do the necessary — to adapt and change quickly using Mr. Pareto’s Principle.

This entry was originally posted on Lawyering for Law Firms blog on October 7. Click here to read the original entry. 

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Amid discussions on how the Sequester will impact the country and reports of law firm downsizing, two recent surveys indicate that economic conditions in the legal industry are on an upswing.

First, on March 18, 2013, Citi Private Bank’s Law Firm Group released results from its Law Watch Managing Partner Index survey. The survey covers the fourth quarter of 2012 and is based on responses from 77 law firm leaders to questions about his or her overall confidence in business conditions in the legal industry. The leaders’ responses were plotted on a 200-point index, with 99 points or less representing a lack of confidence, 100 points representing a neutral response and 101-200 points representing complete confidence. Overall confidence in the industry rose 13 points from the third quarter of 2012, with 34% of respondents indicating his or her overall confidence is now “somewhat better.” Other topics in which leaders are increasingly confident are the economy at large, business conditions of the legal profession, profits and revenues, and demand. As one may expect, leaders also reported a continued increase in demand for discounts, cumulating in 73 points, which places this category in the “lack of confidence” portion of the scale; this index value represents a 4-point drop from Q3 2012 to Q4 2012, indicating that leaders still experience push-back from clients on fees.

Supporting the idea that economic conditions are improving, Robert Half Legal released its 2013 Salary Guide, stating that “an upturn in business activity has sparked renewed hiring at both law firms and corporate legal departments.” Law firms are focusing on hiring experienced lawyers; “hybrid paralegal/legal secretary positions” are also in demand as firms continue to streamline operations. Also, based on a survey of 200 lawyers in the largest firms and corporations in the United States, three key areas of law should experience the most growth in the next two years: healthcare, general business/commercial law, and litigation. Salaries for all legal positions in both law firms (all sizes) and corporations are expected to increase. The Salary Guide further indicates that the employment outlook for Canada also remains positive, with general business/corporate law expected to experience the most growth over the next two years. The Guide concludes with eight signs it’s time to start hiring additional staff (beyond the obvious “new work is coming in”), whether or not counteroffers should be made to departing employees, and eight low-cost employee perks that are inexpensive for employers to offer yet are highly appealing to employees.

Perhaps 2013 will be a banner year after all . . .

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The Cloud with a Silver Lining?

Posted on February 5, 2013 02:48 by Chad Godwin

The "cloud." It’s a term all of us have become familiar with, but also one that many of us give little thought to within the context of our law practices. That, however, is likely to change, as an increasing number of firms are going to be faced with the choice of keeping their data and/or applications local, moving them offsite, moving them to a true data cloud, or employing a combination of on and offsite strategies. What are the cost benefits associated with these choices? What are the security issues that must be addressed? These are questions that IT managers are facing on an ever increasing basis. 

The American Bar Association recently addressed this issue in the ABA Journal. The Journal referred to a survey of 438 lawyers, paralegals and technology staffers, who noted that the bar currently seems to be split down the middle, with 46% of respondents opposing a move to the cloud, 45% favoring such a move and 9% providing no opinion. Moreover, the study suggests that small and mid-size firms appear far more willing to make the move than large firms, perhaps due to the investment in locally-based IT and equipment large firms are presumed to be invested in. Somewhat surprisingly, 47% of lawyers favored the move, while only 40% opposed it. This suggests that one of the primary hurdles associated with such a move, data security, is being adequately addressed. Finally, the study noted that 81% of respondents expect the cloud overtake on-site computing within the next 10 years.

The fact that so many respondents view the move as imminent suggests that the legal industry’s primary concerns are being addressed, and that costs associated with moving to the cloud are likely to continue decreasing while security becomes less of a concern. If there’s one constant with technology, it is that it grows cheaper and more accessible with time. As cloud access continues down that path, one has to believe that it will become an increasingly attractive alternative to on-site data and program management.

If you find this content interesting, or are involved in the technological aspects of practicing law, the DRI Technology Committee would like to urge you to join.  There are currently leadership positions available within the committee, along with plenty of opportunities to obtain exposure for your practice.  If you are interested in joining the committee and getting involved, please contact the me at or our Vice Chair, Joe Cohen at for more information on these opportunities.
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The Approach to Diversity

Posted on October 18, 2012 02:24 by Alison Y. Ashe-Card

“Is dicing the workforce into pre-set categories going to encourage working together,” ponders author Liz Ryan.  In a recent Harvard Business Review article, she describes a recent diversity conference with which she was involved where concurrent sessions were held focusing on women, Baby Boomers, the GLBTQ population, Asians, African-Americans, and the physically challenged.  Ryan suggests, "We are not going to get better at confronting the differences that hamper our ability to work together by separating our people into broad-brush groups... Instead, we're going to get better at celebrating the family backgrounds, religious traditions, and ethnic heritage that our people bring with them to work. We can do that by talking about it — all the time — and by teaching people to talk about the 'sticky human stuff' in general."  She advocates that barriers will be broken down when we actively engage in conversations about our differences.

DRI has demonstrated that it is on the path to becoming a thought leader on the issue of diversity within our profession.  A core centerpiece of DRI’s diversity efforts is the Diversity for Success Seminar and Corporate Expo which will be held on May 30, 2013 in Chicago.  Diversity not only involves how people perceive themselves, but how they perceive others. Those perceptions affect their interactions.  The Diversity for Success Seminar provides a forum for attendees to have courageous, thought-provoking discussions about our differences and the role it plays in our firms, businesses and in the legal profession. 



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Ethics 20/20: The Impact of Technology

Posted on August 30, 2012 03:19 by J. Logan Murphy

Every day, we see the impact of technology on the practice of law. Blogs, social networking, electronically stored information, and other legal resources create enormous economies and unprecedented depth in our field. But with these advantages come unrecognized perils. The transparency and mobility of electronic information creates significant risks to clients, unless properly controlled. As part of the project to rein in technology in the practice of law, the American Bar Association launched an ambitious multi-year project called Ethics 20/20. One of the major goals of Ethics 20/20 was to modernize the rules of ethics and bring them into congruence with the state of technology.

At its most recent meeting, the ABA passed multiple resolutions amending the Model Rules of Professional Responsibility to reflect the evolution of technology in the practice of law. This article provides a brief overview of those amendments. Those who are more interested in the details of the amendments can click here to read the reports online.

Confidentiality When Using Computers
Resolution 105A makes changes to help lawyers understand how to protect client confidences when using new technology, including cloud computing, tablets, and smartphones. Though small, one of the most significant changes is included in Comment 6 to Rule 1.1 (Competence). The Rule now includes a requirement that “a lawyer should keep abreast of changes in the law and its practice, including the benefits and risks associated with relevant technology.” No longer can attorneys simply ignore developments in favor of staid methods of practice. To be competent, an attorney must work effectively with technology and keep alert to technological improvements and changes.

The amendment to Rule 1.6 (Confidentiality of Information) is probably the largest and most impactful rule change related to confidentiality. Now, Rule 1.6(c) requires attorneys to “make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating the representation of a client.” The comments make it clear that attorneys are required to utilize reasonable safeguards to protect confidential information. These changes are geared toward the protection of electronic data, especially given the innumerable bits of sensitive information flying around every day.

Using Technology for Marketing
Resolution 105B was designed to help lawyers understand how the principles of attorney advertising already incorporated into the Rules are affected by the growth of Internet-based marketing and social networking. This particular resolution accomplishes three main goals. First, changes to Rule 1.18 offer guidance on how to market online without inadvertently forming an attorney-client relationship. Recent cases have demonstrated confusion on behalf of the general public regarding whether an attorney-client relationship is formed when the potential client emails the attorney or fills out a communication form on the attorney’s website. The amendments to Comment 2 of Rule 1.18 address the concern by stating that a person becomes a prospective client by “consulting” with a lawyer. While the existence of a consultation depends on the circumstances, the Comment eliminates potential passive liability to prospective clients. A consultation “does not occur if a person provides information to a lawyer in response to advertising that merely describes the lawyer’s education, experience, areas of practice, and contact information, or provides legal information of general interest.” But, if the lawyer actively invites information about a possible representation, the lawyer is probably stuck with a prospective client.

Second, the Rules contain a prohibition against paying others for a “recommendation,” and this Resolution modifies that prohibition to account for online lead generation services through chances to Comment 5 of Rule 7.2. Lawyers may now pay others for generating client leads, as long as the Internet-based lead generator does not “recommend” the lawyer. The lawyer is also responsible for the representations of the lead generator, with Comment 5 placing the onus on attorneys to ensure that the lead generator is not making statements that are inconsistent with the rules.

Finally, amendments to Rule 7.3 assist attorneys in determining when communications on the Internet, particularly through social networking sites, may constitute a “solicitation.” Only a “target communication initiated by the lawyer” directed to a “specific person” that “offers to provide” legal services is a solicitation. Communications to the general public, including Internet banners, are not solicitations, so feel free to jump on that Facebook advertising spot.

Lawyers have been slow to adopt the economies of scale that outsourcing can provide, in part because of the perceived ethical dilemmas presented in outsourcing. Outsourcing can endanger confidential client information and presents a quandary over legal work being performed by attorneys not licensed in the United States. Resolution 105C encourages attorneys to ensure the efficiency, competence, and ethics of any outsourcing process. An entirely new comment is added to Rule 1.1, requiring the informed consent of the client to contract with any lawyer outside of the lawyer’s own firm. And, lest we forget, lawyers are always charged with supervising non-lawyers; that requirement does not abate simply because work is being outsourced to a foreign country. Comments 1 and 3 to Rule 5.3 incorporate this concept and apply the general rule to all non-lawyers outside of the lawyer’s own firm. The basic gist of the changes in Rule 105C is to encourage lawyers to keep a sharp eye on professionals hired from outside their own firm, and to work closely with clients in determining the proper scope of outside contracting and supervision. No surprise there—constant communication with the client is a harbinger of a durable and responsible attorney-client relationship.

Mobile Lawyers
A prevalent by-product of an informationally small, but geographically large, practice is the tendency of lawyers to move their practice. The world does indeed get smaller every year. No longer do lawyers move down the street; more and more, attorneys are moving their practice to different jurisdictions, and virtual law offices are sprouting in all states. The remaining resolutions that passed enable attorneys to establish a practice in another jurisdiction—subject to stringent information protection requirements—while pursuing admission in that jurisdiction. Resolutions 105D and 105E address the ABA Model Rule of Practice Pending Admission and the ABA Model Rule on Admission by Motion, respectively. With a few states signaling their intent to adopt a uniform bar exam, these model rules and their amendments continue the progress toward a more uniform practice of law. In case you have never encountered these model rules, or their state versions, their purpose is to allow experienced lawyers who have moved into a different jurisdiction to continue to practice while awaiting an expedited admission to the Bar. 

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The underlying premise of the U.S. Supreme Court’s precedent in Grutter v. Bollinger is that students benefit from being in a racially diverse educational environment.  As the justices prepare to reconsider the issue of affirmative action in higher education, new research has emerged which examines Grutter’s premise.  The study, “Does Race Matter in Educational Diversity? A Legal and Empirical Analysis,” concludes that law students actually do benefit from racial diversity on campus and that law schools should work to maintain diverse classes.  University of North Carolina School of Law professor Charles Daye conducted the research along with University of North Carolina psychology professor A.T. Panter; University of California, Los Angeles sociology professor Walter Allen; and University of North Carolina at Greensboro professor emeritus Linda Wightman.  Their findings are based on data collected from law schools over a decade. The team surveyed approximately 6,500 incoming students at 50 law schools about their own backgrounds, expectations and experiences. They also conducted periodic focus groups consisting of approximately 200 students throughout their three years in law school.  

The researchers set out to answer two basic questions: Does race make a difference to what students bring to law school? If so, are any differences reflected in the quality of education students receive?  The data shows, resoundingly, that students of different races do come to law school with differences in experience and perception, Daye said.  Perhaps more important, those differences translated into a richer educational experience overall, according to the surveyed students.  "Diversity matters in the way students conduct conversations in class, how they interpret cases, in the way they interact in social settings and with their professors," Daye said.  Critics contend that the study authors used shoddy science to reach predetermined conclusions by relying on self-reporting of law students and assert that the study only demonstrates that students think that diversity helps their understanding of the law.
Does race matter in educational diversity and, if so, how do you measure or quantify the difference that it makes?  Does race make a difference to what students bring to higher education?  If so, are any differences reflected in the quality of education students receive?

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Suppose your client, a lawyer, has been sued for malpractice. Could the alleged malpractice be a basis for discipline? Alternatively, is a disciplinary complaint likely to give rise to a malpractice suit? This article will attempt to shed some light on the distinction between attorney malpractice on one hand and professional misconduct on the other, as well as the types of conduct that may constitute both.

1. What is attorney malpractice?

Simply stated, attorney malpractice is a failure to exercise ordinary skill and knowledge, where that failure damages a client. “To state a cause of action to recover damages for legal malpractice, a plaintiff must allege: (1) that the attorney ‘failed to exercise the ordinarily reasonable skill and knowledge commonly possessed by a member of the legal profession’; and (2) that the attorney's breach of the duty proximately caused the plaintiff actual and ascertainable damages.” Schurz v. Bodian, 2012 WL 502680, *1 (N.Y. App. Div. 2012) (internal citations omitted). See also Legacy Healthcare, Inc. v. Barnes & Thornburg, 837 N.E.2d 619, 624 (Ind. Ct. App. 2006). (attorney malpractice claim involves “failure of the attorney to exercise ordinary skill and knowledge (the breach of the duty).”).

2. What is attorney misconduct?

By contrast, attorney misconduct is the failure to comply with the rules of conduct adopted by a court to which an attorney has been admitted to practice. Because all states except California have adopted some version of the American Bar Association’s Model Rules of Professional Conduct (the “Rules of Professional Conduct”), they will be the focus of this article. A failure to abide by the rules subjects the attorney to discipline by the highest court of that jurisdiction. “Failure to comply with an obligation or prohibition imposed by a Rule is a basis for invoking the disciplinary process.” Rules of Professional Conduct, Preamble, ¶ 19. See also Rule 9, American Bar Association’s Model Rules for Disciplinary Enforcement (“Enforcement Rules”) (“It shall be a ground for discipline for a lawyer to: (1) violate or attempt to violate the [State Rules of Professional Conduct], or any other rules of this jurisdiction regarding professional conduct of lawyers…”). The Enforcement Rules also provide for discipline for refusal to cooperate in the disciplinary process itself. See Enforcement Rule 9 (3), providing for discipline for disobeying a subpoena or order from a bar disciplinary authority.

Of course, the potential consequences of an attorney discipline case are very different from those of an attorney malpractice case. In the worst outcome of an attorney malpractice case, the attorney must pay monetary damages to the plaintiff. By contrast, attorney discipline actions place the attorney’s law license in jeopardy. An attorney who has been found to have violated the Rules of Professional Conduct faces a range of sanctions from a private reprimand up to disbarment, depending on the severity of the violation. See Enforcement Rule 10.

3. Does malpractice equal misconduct, or vice versa?

As noted above, attorney malpractice occurs where an attorney fails to exercise ordinary skill and care, and thereby causes damage to a client. Rule of Professional Conduct 1.1 provides "A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation."

Furthermore, Rule of Professional Conduct 1.3 provides "A lawyer shall act with reasonable diligence and promptness in representing a client."

Thus, it would seem that Rule 1.1 and Rule 1.3 may codify the requirement that an attorney exercise ordinary skill and care, and that failure to do so may constitute misconduct as well as malpractice. It is difficult to imagine a failure to exercise ordinary skill and care that is not also a failure to employ the “legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation.”

Some courts have indeed treated isolated mistakes as misconduct and punished it accordingly. For instance, in Board of Professional Responsibility, Wyoming State Bar v. Vreeland, 2012 WL 662236 (Wyo. 2012), an attorney represented a client in a criminal trial. Id. at *1. The jury returned a conviction on February 4, 2010. Wyoming Rule of Criminal Procedure 29(c) required that a motion for judgment of acquittal be made within 10 days of the jury’s verdict, and Rule 33(b) required a motion for new trial to be filed within 15 days of the verdict. However, Vreeland did not file the motions for judgment of acquittal and for a new trial until March 3, 2010; hence, the motions were untimely. Id. The Wyoming Supreme Court found that Vreeland violated Rules 1.1 and 1.3 of the Wyoming Rules of Professional Conduct (based on the Model Rules) and imposed a sanction of public censure. Id. at *2. See also Board of Professional Responsibility, Wyoming State Bar v. Dunn, 262 P.3d 1268 (Wyo. 2011) (attorney received public reprimand for failing to file timely governmental claims notice and complaint); In the Matter of Brown-Williams, 2012 WL 366587 (Ga. 2012) (attorney received public reprimand for missing statute of limitations in workers' compensation case).

By contrast, some courts have explicitly held that an isolated mistake is not a proper basis for discipline. For instance, in In the Matter of the Application for Disciplinary Action Against William E. McKechnie, 656 N.W.2d 661 (N.D. 2003), the Supreme Court of North Dakota addressed a mistake similar to the mistake made by Vreeland, but found that the mistake did not constitute misconduct. "In this case, McKechnie gave Follman incorrect legal advice about the statute of limitations and Follman's case was dismissed for failure to file within the limitations period. This evidence shows nothing more than an isolated instance of ordinary negligence, or error of judgment. We conclude there is no clear and convincing evidence that McKechnie violated N.D.R. Prof. Conduct 1.1." Id. at 669.

Even in jurisdictions whose highest courts have not specifically stated that isolated attorney mistakes should not give rise to discipline, attorneys are not typically sanctioned under Rule 1.1 or 1.3 for simple negligence. More commonly, it appears that attorneys are disciplined for violations of Rule 1.1 or 1.3 in addition to numerous other violations of the Rules of Professional Conduct that involve intentional misconduct, dishonesty, ongoing failure to communicate with clients, or chronic neglect of clients’ interests. For instance, in In Re Adinolfi, 934 N.Y.S.2d 94 (N.Y. App. Div. 2011), an attorney was sanctioned for violating New York Rule of Professional Conduct 1.3 where at least 26 of the attorney’s 103 cases before the Second Circuit Court of Appeals had been dismissed for failure to file a brief. 95.

Finally, the Preamble to the Rules themselves suggest that isolated mistakes should not subject a lawyer to discipline: “Moreover, the Rules presuppose that whether or not discipline should be imposed for a violation, and the severity of a sanction, depend on all the circumstances, such as the willfulness and seriousness of the violation, extenuating factors and whether there have been previous violations.” Rules of Professional Conduct, Preamble, ¶ 19. Thus, those courts that have either explicitly stated that an isolated mistake is not a basis for discipline, or at least typically decline to sanction lawyers for such mistakes, appear to employ an approach more in keeping with the spirit of the Rules.

What about the reverse question: can an act or omission that constitutes attorney misconduct give rise to a malpractice action? The Preamble to the Rules of Professional Conduct provides that violation of a Rule should not in itself give rise to a cause of action. “Violation of a Rule should not itself give rise to a cause of action against a lawyer nor should it create any presumption in such a case that a legal duty has been breached.” However, violation of a Rule can be evidence of the breach of the standard of ordinary care. The Preamble provides that though “[the Rules] are not designed to be a basis for civil liability,…[n]evertheless, since the Rules do establish standards of conduct by lawyers, a lawyer's violation of a Rule may be evidence of breach of the applicable standard of conduct.” Furthermore, some kinds of attorney misconduct have nothing to do with attorney malpractice. For instance, a felony conviction for operating a vehicle while intoxicated will certainly result in discipline, but would provide no basis for a malpractice claim.

Dina M. Cox is a partner with Lewis Wagner, LLP in Indianapolis, who focuses her practice on the defense of complex litigation, including legal malpractice, drug and medical device, product liability, consumer class actions, and insurance coverage and bad faith lawsuits.

Neal Bowling, attorney with Lewis Wagner, LLP, focuses his practice on complex business litigation as well as defense of lawyers in malpractice and disciplinary matters. He has extensive experience advising and representing clients in complex and challenging litigation including: securities matters; employment litigation involving breach of noncompete and wrongful termination claims; and representation of lawyers in malpractice actions and disciplinary investigations and proceedings. 

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