Legal Dabbling: Hurricanes Create Calm Before Legal Malpractice Storm Surge

As Texans continue cleaning up the destruction of Hurricane Harvey and Floridians brace for Hurricane Irma bearing down on them, many lawyers in the regions will be seduced by the money to be made from the sheer number of insurance claims and lawsuits soon to be filed.

Unfortunately, many of these lawyers will instead find themselves professionally devastated by a legal malpractice claim because they chose to “dabble” in an unfamiliar area of law into which they never shoulMan Storm Umbrellad have ventured.

We already have seen several law firms ramping up on social media and in news reports to grab a piece of the inevitable FEMA, inverse condemnation, and first-party insurance claims to come.

Both massive storms, however, will spur other kinds of complex litigation as well.

We will inevitably see an uptick in claims involving professional negligence against architects, engineers, and design professionals; director and officer liability; building owners, real estate development and management companies; and landlord-tenant disputes just to name a few.

None of these types of claims are any place for a novice. Unfortunately, attorneys unfamiliar with an area of practice often simply don’t know what they don’t know.

Each of these areas of law are exceedingly complex and nuanced. Issues relating to liability, defense, and damages often are not easily identifiable by an inexperienced attorney. A single misstep can lead to disaster for the client and attorney.

The American Bar Association Rules and every other state impose a duty that “a lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation.” ABA Model Rules 1.1.

“Dabbling” in an area of law in which an attorney is not familiar, however, remains among the top five reasons for legal malpractice claims nationwide despite the ABA model rules, state bar rules, and the legal and insurance professions’ constant warnings.

The ABA “Profile of Legal Malpractice Claims: 2012-2015” reports that 46 percent of all legal malpractice claims involve “substantive errors,” including a failure to know or apply the law, failure to know or calculate deadlines, inadequate discovery, and errors in procedure strategy.

The ABA report found that more than 60 percent of all malpractice claims involve an area of the law in which the subject attorney works less than 20 percent of the time. Attorneys who practice in a single area of the law account for less than 7 percent of all legal malpractice claims.

According to panelist on a recent ABA webinar, “Avoiding Common Malpractice Missteps: What Every Lawyer Needs to Know (On-Demand CLE),” 13 percent of legal malpractice claims arose specifically because the attorney did not know the area of law.

A recent 2017 study by professional liability insurance leader Ames & Gough reveals that the number of new legal malpractice claims is stabilizing. Claims, however, remain well above historical experience in years preceding the 2007 – 2009 recession that forced many attorneys to expand into unfamiliar areas of practice.

Any lawyer considering assuming the representation or defense of a claim outside the lawyer’s ordinary practice area should answer several basic questions before taking on the client.

  • How complicated is the matter and area of law?
  • What is the amount in controversy?
  • Are the potential fees recoverable worth the risk?
  • How familiar are you with the jurisdiction or venue?
  • Can you spend the additional time necessary to get up to speed on the area of law?
  • Do you have the financial resources to take on the representation in an area where you will need to spend considerable time to learn the law?
  • Can you associate with or turn to experienced attorney for help on the matter?
  • How difficult will the client to be, and does the client have unreasonable pre-claim expectations?
  • Do you have adequate professional liability insurance coverage?
  • How devastating will a legal malpractice claim on the case in question be on your overall law practice and personal life.

If an attorney decides to take on a case outside their regular practice area, the attorney can take a few simple steps to help minimize the risk of a future legal malpractice claim such as:

  • Draft a clear engagement agreement signed by the client.
  • Engage experienced co-counsel early.
  • Research the law and procedure thoroughly upfront before taking on the case.
  • Designate time each day or week to continue learning the law and to work on the claim.
  • Take advantage of continuing legal education courses available online and from the state and local bar association.
  • Participate in networking opportunities with experienced attorneys in the area.
  • Prepare internal memorandum and case evaluations on legal issues as they are identified.
  • Keep the client thoroughly informed as the case progresses.
  • Don’t be afraid to ask for help.
  • Withdraw immediately if it becomes clear you’re over your head.

No lawyer should ever be unwilling to expand their scope of practice simply because of the fear of a legal malpractice lawsuit. No lawyer, however, should ever think that circumstances like Hurricane Harvey or Hurricane Irma present an economic windfall simply because of the volume of legal work that can be expected to result.

Now is no time to “dabble” in an unfamiliar area of law.

Attorneys also should resist the temptation to even “do a favor” for a friend or family member because it usually helps no one. The “favor” often gets pushed to the bottom of the attorney’s stack of things to do, and the client ultimately suffers from delays, missed deadlines, or less than competent representation.

If an attorney decides that now presents a unique opportunity to expand into a new area of practice, be willing to commit upfront the substantial time and resources necessary to comply with ABA Model Rule 1.1, or be prepared for the personal and professional devastation that inevitably will come from a legal malpractice claim.

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20170712_113656Timothy B. Soefje is the Managing Member and head of the professional liability section at the boutique firm of Seltzer │Chadwick │Soefje, PLLC based in Dallas, Texas. For regular information about professional liability matters, follow him on Twitter at @TimSoefje and search #ProfessionalLiability. For more information, visit us at www.realclearcounsel.com or contact him at tsoefje@realclearcounsel.com.

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