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Managing Ethical Risks Part 7

Familiarity and complacency cause lawyers to assume, often incorrectly, how the client wants them to handle a case.


By the time a lawyer gets his tenth in a series of similar cases from his client, he may take for granted that he knows how the client wants the case defended and just proceed according to his assumptions. Lawyers should not allow inertia to determine how they are going to handle a case. Even in the context of a "typical" matter for a client with whom the lawyer has a close, lengthy relationship, the lawyer should find out the client’s objectives and how they want the case defended, and then set about implementing the client's wishes.


Doing so is not only good practice; it is required by the following ethical rules. Although a close and familiar relationship with the client may allow the lawyer to address these matters in an abbreviated and less formal manner than he may have done in his first case for the client, the lawyer must do these things in some manner in each case.


Rule 1.2 Scope Of Representation And Allocation Of Authority Between Client And Lawyer


(a) Subject to paragraphs (c) and (d), a lawyer shall abide by a client's decisions concerning the objectives of representation and, as required by Rule 1.4, shall consult with the client as to the means by which they are to be pursued.


Rule 1.4 Communication


(a) A lawyer shall:


(1) promptly inform the client of any decision or circumstance with respect to which the client's informed consent, as defined in Rule 1.0(e), is required by these Rules;


(2) reasonably consult with the client about the means by which the client's objectives are to be accomplished;


(3) keep the client reasonably informed about the status of the matter;


(4) promptly comply with reasonable requests for information; and


(5) consult with the client about any relevant limitation on the lawyer's conduct when the lawyer knows that the client expects assistance not permitted by the Rules of Professional Conduct or other law.


(b) A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.


Without regard to how close the lawyer's relationship is with the client, lawyers sometimes find themselves in trouble because they adopt the attitude that the case is "my case" rather than the client's case.  This attitude may manifest itself in arrogance, with the lawyer taking an Al Haig "I'm in charge here" approach. More often the lawyer may have the perception that he should not trouble the client with certain decisions, or may fear being regarded as indecisive or afraid to make a tough call if he goes to the client to make important decisions.


Lawyers should avoid these ways of looking at their relationships with their clients. The case is the client's case, not the lawyer's. The lawyer's job is to give the client good advice about the pros and cons of different alternatives, make a recommendation, and allow the client to make an informed decision. To the extent there are risks associated with given choices, those risks are the client’s, and the client – not the lawyer – should choose which risks they want to take and which ones they do not. Lawyers who make these decisions for their clients without consulting them may find themselves insuring against losses resulting from those risks.


Next: Withholding Bad News, Not Withdrawing

Managing Ethical Risks Part 6

Familiarity and complacency cause lawyers to not memorialize important developments, discussions, and decisions (for fear they will be perceived as “CYA”). 

Lawyers in close relationships with clients often do not confirm things in writing that they would confirm in writing with a new or unfamiliar client, typically out of fear that the client will perceive a lawyer to be unnecessarily "covering their ass." Lawyers and clients need to get past this idea and instead welcome written confirmation of important developments, discussions, and decisions. The risks associated with not confirming such things in writing are well demonstrated by considering them in juxtaposition with the benefits of doing so. 

The most basic benefit of confirming things in writing is to make it unnecessary to depend on one's memory to know what happened. If a lawyer or client does not remember what they discussed about the case, what the client decided, or why, all sorts of bad things may happen. Additionally, not having important events and decisions reduced to writing can lead to disagreement and conflict as a result of differing memories, whether genuine or fabricated.  Confirming matters in a written communication to a client (as opposed to a memo to the file that the client does not see) avoids these potential problems. 

Another benefit of reducing developments and verbal communications to a writing that is sent to the client is that the process gives the reader the opportunity to address promptly any errors or misunderstandings in the writer's rendition of what happened. If the client and the lawyer leave a conversation with different understandings of what was said or decided, it is much better to find that out early, through this process, than later, after the misunderstanding or miscommunication may have produced a harmful result. 

A related idea is that things often look much different in writing then they may have sounded in a conversation. A client that makes a decision after a conversation with a lawyer may want to revisit that decision when he receives a confirming letter that says, "This will confirm that, although I advised you not to do so, you instructed me to…" The client may not have perceived the lawyer's comments to have been of this nature, or may rethink the decision merely by being confronted with its presentation in this form. Many undesirable outcomes that produced malpractice claims could have been avoided by achieving a level of greater clarity in attorney-client communications; confirming letters allow lawyers and clients to communicate with clarity. 

Another benefit of sending confirming communications is that, although some cases may seem like they will last forever, neither you nor your client contact will. Confirming letters allow your successors (as well as contemporaries working on a matter with you or the client) to understand what happened, what the lawyer and client decided, and why. This allows the matter to proceed smoothly in real time, and also precludes later players from inaccurately portraying the situation to the lawyer's disadvantage. 

Lawyers and clients should think of their files not as warehouses, but as toolboxes. Confirming letters are not something that a lawyer should just plan to pull out later to defend herself against accusation of malpractice. They are written records of important developments, discussions, and decisions that good lawyers use to do good work in real time, as well as to avoid making errors.

 Next: Handling Cases by Inertia

Managing Ethical Risks Part 5

Familiarity and complacency also cause lawyers to take a casual approach to written communications. 

One of the nice things about having a long-standing, friendly relationship with a client is that the lawyer can let his guard down, be more relaxed, and not be such a lawyer, right? This is a natural part of the process of developing and maintaining close relationships. 

While that may be true from an interpersonal relations perspective, it becomes dangerous ground when viewed from a risk management perspective, especially with respect to written communications. Any written communication, whether a letter, e-mail, or text message, that will become part of your file or the client's file about that matter (and you should assume that all of them will) should be lawyerly and professional. Each should also be unambiguous with respect to whether the information being communicated is to be interpreted literally, to be taken in jest, or regarded as hyperbole.

Written communications that were perfectly appropriate when they were composed may appear inappropriate later when circumstances change, friends have become enemies, or a client representative with a different set of standards or sense of humor is reading the communication. Make communications "bulletproof" regardless of who is reading them, or under what circumstances. 

In that regard, you should assume that your written communications with a client will someday be read by a larger, non-client audience.  Although a client can count on his lawyer to keep attorney-client privileged communications confidential, a lawyer should not count on his client to do so. A client can waive the privilege and publicize lawyer communications for any reason or no reason at all. In legal malpractice claims, all relevant attorney-client communications can become public. Even absent litigation, a client may choose to publicize harmful communications from an attorney after a falling out.


Next: Failing to Memorialize


Managing Ethical Risks -Part 4

Familiarity and complacency also cause lawyers to take a casual approach to checking and clearing conflicts associated with multiparty representations.

How many times do you suppose this has happened:

Voicemail: "Jane? Bob here. I'm sending you over a new case. They sued the retailer in this one to avoid diversity, so we will need you to represent that company, too. Please run conflicts and let me know."

            Email response: "Bob, no conflicts. Send the file, and thanks again for        engaging us."

Jane sends engagement letter to Bob, receives and reviews the file, and files answer for company and retailer.

In my experience, this happens a lot, and it creates a lot of problems. Here are some of them, along with suggestions about how to avoid them.

Running the names of the plaintiff and your prospective clients through your conflict system does not tell you everything you need to know to determine whether you have a conflict that would preclude you from representing both defendants in a lawsuit.  Whether you can represent multiple defendants depends on a variety of factors that are listed in Model Rule 1.7 and its comments. In order to develop the information needed to make all these determinations, the lawyer has to have conversations with the client that asked her to undertake the representations and the other individual or entity she is being asked to defend. Only after the lawyer determines that the facts and her potential clients' positions allow her to do so may she agree to represent both of them.

As the Rule and common sense require, the lawyer must also talk to the other party she has been asked to represent to determine whether that party wants her to represent it at all, before ever getting to the question of whether conflicts would preclude her from doing so. A lawyer cannot simply make an appearance on a party’s behalf just because someone else has agreed to pay the lawyer to represent it, without first obtaining the party’s consent to be represented in this manner.

Finally, just as the lawyer should with respect to her "regular" client, the lawyer should send her other, new client an engagement letter, and otherwise treat that client in the very same way she treats her "regular" client. To even think of this client as a "secondary" client (and the regular client as the "primary" client) as some lawyers do is to invite breaches of duty to the “secondary” client that can result in malpractice claims.

The failure to correctly navigate the opportunity to undertake a multiparty representation may result in the lawyer finding herself in a conflicting representation from which she, at best, will have to withdraw from both representations or, at worst, may face a malpractice claim. Even the act of withdrawing will cause the lawyer's "regular" client to incur the additional expense of getting new counsel up to speed, which could be an expensive proposition. If this risk is not made part of the conversation going in, the lawyer's "regular" client may not remain such a client in the future. The circumstance of having represented clients with conflicting interests, however briefly, may also later lead to allegations that the lawyer placed one of those client’s conflicting interests ahead of the other, and harmed the other in doing so.

Next: Written Communications

Managing Ethical Risks Part 3

The Hazards of Close Attorney-Client Relationships 

The benefits of having close friendships with your clients are obvious and need not be listed here. The hazards of such relationships are less obvious. For purposes of this paper, the primary hazards associated with attorneys’ close friendships with clients are familiarity and complacency

Familiarity: the quality or state of being familiar: having a good knowledge of something; natural and unstudied; arrogantly self-confident. 

Complacency: satisfaction or contentment, especially when coupled with an unawareness of trouble or controversy; smug self-satisfaction. 

-Webster's II New College Dictionary, Third Edition. 

The familiarity and complacency that – unless guarded against - are natural byproducts of close friendships with clients cause lawyers to do things they should not do, and not do things they should.  These acts and omissions place both the client and the lawyer at risk: the client for a disappointing outcome, and the lawyer for becoming a party to a lawsuit rather than counsel for a client in one. 

Familiarity and complacency cause lawyers not to do certain things that they should and to do things that they should not. Most commonly, they cause lawyers not to send engagement letters. 

The engagement letter is a basic and critical risk management tool. A good engagement letter will specify precisely who the client is, what services the client has asked the attorney to perform, the terms under which the lawyer will provide those services (including terms of payment), and how any actual or potential conflicts have been addressed and resolved. If there is ever a question about who the lawyer was supposed to represent or what the lawyer was supposed to do (which are, surprisingly, frequently issues in legal malpractice cases), the engagement letter should contain the answer. 

Lawyers who get a lot of cases from a single client often elect not to write engagement letters for each new matter. They may instead rely on the terms of a "preferred counsel" agreement, a single engagement letter that is intended to address all matters the firm is engaged to handle, or some other "master" understanding or agreement, whether written or unwritten. While it is perfectly fine to incorporate the terms of a master agreement or master engagement letter in a matter-specific letter, lawyers should always prepare a separate engagement letter that addresses the particulars of each new matter. 

Writing an engagement letter requires you to correctly identify your client. Correctly identifying the client is important for any number of reasons, not the least of which is to obtain an accurate result when running a conflict check. Complacent lawyers may not be careful about understanding or specifying the identity of the client, whether it is a subsidiary or affiliate of the attorney's "regular" client, a partnership or other business entity rather than the individual or company with whom the attorney has a relationship, and so on.  This may cause the lawyer to end up in a conflicted relationship even though the lawyer performed a conflict check. All of this can be avoided by confirming the identity of the client in an engagement letter. 

In many cases, it is equally important to clarify in an engagement letter who the attorney is not being retained to represent, such as another defendant in a multiparty case (like a retailer the plaintiff sued to defeat diversity jurisdiction). Putting this information in the engagement letter will either memorialize correctly that the attorney has not been retained to represent the stray party, or bring to the surface a misunderstanding that the client can correct by expressly asking the attorney to represent the stray party.

Similarly, lawyers that regularly get certain types of cases from a client may not discuss with the client or specify in an engagement letter what aspects of a multifaceted situation the lawyer is, and is not, being retained to address. For example, in cases in which claimants file a lawsuit but also involve a regulatory proceeding, the client might typically hire the lawyer to defend the lawsuit, but handle the regulatory proceeding in house. How the client and lawyer allocate these responsibilities should be memorialized in an engagement letter. If a ball gets dropped, this will make it clear whose responsibility it was to keep that ball up in the air. Also, if the client wants the lawyer to handle both proceedings in a particular situation, but this is not clearly communicated, the lawyers’ engagement letter stating otherwise will give the client the opportunity to correct this misunderstanding. 

The bottom line is that lawyers are frequently sued for malpractice by people or companies that they did not represent, and for not doing things they were not hired to do.  Engagement letters help avoid the circumstances that give rise to those claims, and help lawyers defend such claims if and when they do arise.

Next: Checking and Clearing Conflicts in Multiparty Representations

New California Employment Laws for 2014: A Primer for Californians and Non-Californians-Part 2


In my first blog on new California legislation for 2014, I addressed some of the issues that California lawyers and employers – and employers and lawyers outside of California who might be dealing with California businesses – might want to know.  I continue with some changes to California’s Fair Employment and Housing Act, and with some potentially draconian anti-retaliation legislation.

Effective 2014, the California Fair Employment and Housing Act (“FEHA”) was amended to specify that sexual harassment does not need to be motivated by sexual desire to be unlawful.  This amendment is largely unnecessary as existing case law makes it clear that harassment motivated “because of” the victim’s gender is unlawful and harassment motivated by sexual interest is only one type of sexual harassment.  [Senate Bill 292]

Military and veteran status will be added to the list of classifications protected by the FEHA.  However, this will not prevent an employer from asking about military or veteran status in order to provide a preference as permitted by law.  [Assembly Bill 556]

Labor Code section 98.6 prohibits an employer from discharging or discriminating against an employee for engaging in certain conduct.  Effective 2014, Section 98.6 has been amended to clarify that an employer is also prohibited from retaliating or taking any adverse employment action against an employee who engages in the protected conduct, and adds making a written or oral complaint for unpaid wages as protected conduct.  In addition to reinstatement and reimbursement for lost wages and benefits, remedies will include a civil penalty of up to $10,000.

 Labor Code section 1102.5 currently prohibits an employer from retaliating against an employee for disclosing information to a government or law enforcement agency which the employee reasonably believes discloses a violation of state or federal statute or violation or noncompliance with a state or federal rule or regulation.  The 2014 amendments expand these protections to reports made to persons who have authority over the reporting employee or the authority to investigate or correct the violation or noncompliance, as well as to employees who provide information to or testify before a public body.  The amendments also add reports of violations of local rules or regulations.

By contrast, new Labor Code section 244 will make it an “adverse action” to report or threaten to report an employee’s (or an employee’s family member’s) suspected citizenship or immigration status to a public agency because the employee has exercised a right under the Labor, Government or Civil Codes.  This new legislation raises troubling questions, seeming to undermine the absolute privilege associated with making reports to the police or other law enforcement agencies; it also creates an stark anomaly:  under Labor Code § 1102.5, employees can disclose information to government and law enforcement agencies with near-absolute impunity, but employers who reasonably believe a violation of federal law has occurred face a possible lawsuit for reporting potential violations under § 244.  Expect some challenges to this new legislation. 

New Labor Code section 1019 will make it unlawful for an employer to engage in certain “immigration-related practices” in retaliation for any person exercising rights protected by the Labor Code or local ordinance.  “Unfair immigration-related practices” include: (a) Requesting more or different documentation than required to complete the Form I-9 or refusing to honor such documents that on their face appear to be genuine; (b) Using the E-Verify system to check employment authorization status of a person at a time or in a manner not authorized by federal law; (c) Threatening to file or filing a false police report; or (d) Threatening to or contacting immigration authorities.  Again, expect some challenges to some portion or all of this new legislation, especially those portions which propose to penalize employers for merely contacting immigration authorities.  In a “Simons says” exception, however, “unfair immigration-related practices” do not include conduct expressly and specifically directed or requested by the federal government.

 Engaging in an “unfair immigration-related practice” within 90 days of a person exercising his/her rights under the Labor Code or local ordinance creates a rebuttable presumption of retaliation.  The new section authorizes a civil action and prevailing plaintiffs will be entitled to attorneys’ fees and costs, including expert costs.  It also authorizes the court to suspend licenses held by the violating party.

Labor Code sections 230 and 230.1, which provide protections to victims of domestic violence and sexual assault, are amended to add the same protections to victims of stalking.  In addition to extending employment protections to victims of stalking, the amendments make it unlawful for employers to discriminate against any of these victims because of their status and create obligations similar to those owed to employees with disabilities. 

Employers will be required to provide reasonable accommodation when requested by an employee for safety reasons.  “Reasonable accommodation” may include implementing safety measures such as a transfer, reassignment, modified schedule, changed work telephone, changed work station, installing a lock, assistance in documenting domestic violence, sexual assault or stalking occurring at work, implementing a safety procedure or other adjustment to the job structure, workplace or work requirement, or referral to a victim assistance organization.

Employers will also be required to engage in an interactive process with these employees to determine an effective reasonable accommodation.  Employers will not be required to provide an accommodation that constitutes an undue hardship or that would violate their obligation to provide a safe and healthful workplace for all employees.

The 2014 amendments also add victims of stalking to the protections of Labor Code section 230.1, which currently prohibits employers with 25 or more employees from discriminating against an employee who is a victim of domestic violence or sexual assault from taking time off to: (a) Seek medical attention for injuries; (b) Obtain services from a domestic violence shelter or rape crisis center; (c) Obtain psychological counseling; or (d) Participate in safety counseling or take other actions to increase safety, including relocation.

There is also no “undue hardship” limitation on the obligation to permit an employee to take time off under section 230.1.  Although the leave may not exceed the 12 weeks permitted under the FMLA, section 230.1 applies to employers who have half the number of employees required for FMLA leave.  [Senate Bill 400].

California has always presented unique challenges to employers trying to conduct business in the State.  2014 continues the trend.




Nebraska SC Finds Exclusions Trump Severability Clause

Last week, the Nebraska Supreme Court handed down an insurer-favorable decision concerning the interplay between exclusions and severability clauses.  American Family Mutual Insurance Co. v. Wheeler, 287 Neb. 250 (Jan. 24, 2014).

The facts were sad, but straightforward.  A young man sexually assaulted a minor.  The minor’s parents sued both the young man and his father.  Plaintiffs alleged that the father was negligent by failing to warn the plaintiffs and failing to supervise the son. 

The insurance company disclaimed based upon exclusions for sexual abuse and intentional injuries.

The father argued that the exclusions did not apply because of the “severability of insurance” clause.  Specifically, this clause stated that: “[t]his insurance applies separately to each insured.”  The father conceded that absent the severability clause, the exclusions applied to bar coverage.

The court applied an interesting analysis to find for the insurance company.  The court noted that the exclusions applied to “any” insured.  Thus, the court said that the conclusions applied despite the severability clause.  The court noted, however, that it would have found for the policyholder if the exclusions applied to “the insured.”

The court explained its reasoning as follows:

[Our decision] is consistent with our oft-stated approach to give language in an insruance contract its plain meaning.  We have in the past concluded that the “an insured” language, and implicitly the “any insured” language, is clear and unambiguous.  Such language means what it says, and the severability clause does not operate to override this clean and unambiguous language.  In other words, applying  the insurance separate to each insured, as the severability clause requires, does not change the exclusions reference “an insured” or “any insured.”

2014 New CA Legislation

Most FDCC members aren’t California lawyers or businesses based in California.  Many are happy to keep it that way.  However, for all its perceived social silliness and public finance profligacy, California, the 12th largest economy in the world (, still beckons. 

As a result, it’s the rare lawyer and the rare client who won’t, at some point, do business with a California entity, or have a customer, vendor, or representative in California.  For better or worse, California also is viewed as a trend-setter in labor and employment matters, often initiating legislation that other states later adopt. 

So, for those who are thinking about dipping a big toe into California’s economy this year, and for those FDCC lawyers to whom non-California clients will turn for guidance (or to find out whether or not they need local guidance) as they enter California, I thought we’d blog a bit over the course of the next week about what’s new in California employment legislation for 2014. 

One of the biggest items is an increase in the California State Minimum Wage.  The California State minimum wage increased to $9.00 per hour effective July 1, 2014 and to $10.00 per hour effective January 1, 2016.  This also necessarily increases the minimum salary that must be paid to exempt employees, who must receive a monthly salary of no less than two times the minimum wage for full time employment.  [Assembly Bill 10]. 

But note!  Cities and counties in California may establish their own, higher, minimum wage rates.  San Francisco’s minimum wage for 2014, for example, is $10.74/hour!  So check not only the statewide minimum wage, but also local minimum wage ordinances, before advising clients about California minimum wage rates. 

In other legislation going into effect in 2014, California again tipped the playing field in favor of employees, this time in favor of those who sue to recover unpaid wages (including unpaid minimum wages or unpaid overtime).  Previously, Labor Code § 218.5 provided only that the “prevailing party” in a suit to recover unpaid wages was entitled to attorneys’ fees.  That meant that a wrongfully-sued employer was entitled to an award of attorneys’ fees if the employer merely “prevailed” in the action.  No more.  Now, a prevailing employer may only recover attorneys’ fees if the employer prevails AND establishes that the employee’s claim was brought in bad faith.  In essence, for wage claims the Legislature adopted the standard applied by the U.S. Supreme Court in Christiansburg Garment Co. v. EEOC (1978) 434 U.S. 412 in determining whether an employer who prevails in a Title VII action can recover fees from the Plaintiff.  Anyone who’s tried to recover fees on behalf of a prevailing employer knows how difficult it is to make the required showing.


Next, I’ll talk about amendments to the California Fair Employment and Housing Act, and some dramatic new anti-retaliation legislation.

Managing Ethical Risks-Part 2

Who is getting sued and for what?

The statistics regarding the nature and frequency of legal malpractice claims offer some good news and some bad news. The good news is that most legal malpractice claims are not brought against lawyers that do what FDCC lawyers do, or the firms in which we do it. Most claims are brought against lawyers in other areas of practice and who practice alone or in smaller firms. The bad news is that claims arise from doing the very same kinds of things that we do in our area of practice every day.

The ABA Standing Committee on Lawyers' Professional Liability prepares a survey of legal malpractice claims every four years. It publishes the results in its Profile of Legal Malpractice Claims, the most recent version of which is for the years 2008-2011.

This survey reveals that during this period of time about half of all malpractice claims were made against lawyers in just three areas of practice: real estate (20% - took over the top spot from personal injury plaintiffs’ attorneys), personal injury plaintiffs’ (16%), and family law (12%). All other areas of practice fill in the other half: estate, trust, and probate (11%), collection and bankruptcy (9%), corporate/business organization (7%), criminal (5%), and business transaction commercial law (4%). Only 3% of malpractice claims were made against personal injury defense attorneys, 2% against labor lawyers, 2% against worker’s comp lawyers, and 2% against patent, trademark, and copyright lawyers. The rest are each 1% or less of all claims.

With one caveat, the survey's results with respect to claims by firm size are also encouraging for lawyers that practice in larger firms: the vast majority of claims are made against lawyers in smaller firms. (The caveat is that most lawyers practice in small firms, so, even if they were evenly distributed, most claims would arise in small firms.) 34% of all claims were made against sole practitioners, and another 32% against lawyers that practice firms of 2-5 lawyers. 10% of claims were made against lawyers in firms of 6-10 lawyers, and 11% against lawyers in firms of 11-39 lawyers. Only 4% of claims were made against lawyers in 44-99 lawyer-sized firms, and about 9% were made against lawyers in firms of 100 or more lawyers.

These statistics demonstrate that most of the shots being fired in the form of legal malpractice claims are hitting targets at firms and in areas of practice that are different than ours. However, when considered by the nature of the activity that gave rise to the claims, the statistics also show that claims arise from doing the very same things that we do.

28% of all claims arise from the preparation, filing, or transmittal of documents, 20% from giving (or not giving) advice (this number was up from 13% in the last survey), and another 17% from errors committed when commencing an action or proceeding.  9% arise from mistakes in pretrial activities, and 7% from mistakes in negotiations and settlements. Only 5% of claims arise from errors in trials or hearings, and 2% from mistakes during appeals.

You are probably not going to manage the risks of being sued for malpractice by changing the size of your firm or the nature of your practice. You can, however, manage the risks of being sued for malpractice that relate to the manner in which you perform the “blocking and tackling” activities that go into practicing law every day.

Next: The Hazards of Close Attorney-Client Relationships

Managing Ethical Risks-Part 1

Managing Ethical Risks and Avoiding Malpractice in Close Attorney-Client Relationships – Part 1

Sometimes lawyers get sued for actually making mistakes that cost their clients money. Often, however, lawyers who did nothing wrong get sued because their clients lost money and are merely looking for ways to offset their losses.  The goal of this series of blog posts is to help you avoid being the subject of both kinds of claims. 

Fortunately, FDCC members are generally at a lower risk of being sued for malpractice than most lawyers. Most claims are brought against lawyers in small firms that practice in different areas of the law than we do. Most claims also arise out of "one off" representations; claims are far less common in the context of a good, long-standing relationship with a friendly client. 

But if the last few years have taught us nothing else, they have taught us that people come and go; companies consolidate and fire your friends; and there is more emphasis than ever on the bottom line.  You may find yourself one day in a comfortable, secure relationship with an in-house lawyer who loves your work, and the next day under the close, hostile scrutiny of a stranger that prefers another lawyer and may be looking for a reason to fire you, that disagrees with how you and the in-house lawyer he replaced handled a given case, or that has been charged with the task of recouping litigation costs and losses in some manner. Worse still, circumstances may change in a manner that causes a once-close friend to become an adversary.  

You have no way of knowing in advance what client or matter may go south. From a risk management perspective, the best approach is to treat every client and every matter as if it may be The One (the case that gets you sued), regardless of how comfortable your relationship with the client may be. By doing this, you will decrease the chances that any given case or client will become The One. 

Bottom Line Advice:long-standing, close relationships with clients should affect how, not whether, you implement basic risk management practices. 

Corollary Observation:the things lawyers do to observe sound risk management practices, meet their ethical obligations, and engage in "best practices" to provide high quality legal services tend to overlap each other. In other words, implementing risk management practices does not simply help you avoid being sued for legal malpractice, and fulfilling ethical responsibilities does not simply help you avoid being grieved. Doing these things also help you render high quality legal services, which should be one of every lawyer's primary goals. 

Example: diligence. Model Rule 1.3 requires a lawyer to act "with reasonable diligence and promptness in representing a client." Being responsive and proactive is a sound risk management practice; it will help you satisfy this ethical obligation; and it will help make you a high-quality lawyer. Do not think of risk management practices as a separate set of things you should do to avoid being sued; think about them, the ethical rules, and the best practices of good lawyers as an integrated whole. 

Plug for General Counsel:if you are in a firm of 30 or more lawyers and do not have a general counsel or risk management partner, you should consider appointing one. Centralizing this function will enable your firm to recognize systemic problems, spot troublesome trends and patterns, and identify other problems that otherwise would go undetected. Letting attorneys know that a certain person in the firm has been designated as the person with whom they should consult about ethical or professional dilemmas also increases the chances they will seek guidance about such problems, rather than trying to solve them on their own. 

Next time: Who is Getting Sued and For What

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