Ch. 10 Preventing Legal Malpractice

1. Ch. 10 Preventing Legal Malpractice Finalé!

2. Overview • Proactive: “an ounce of prevention is worth a pound of cure” • Risk management/loss prevention • Sound ethical infrastructure • Australia: compliance through education, self-audit • U.K.: outcome based regulation • U.S., Terry’s “modest proposal” for regulators to implement these models through RPC 5.1

3. A. Law Practice Risk Management • Avoidance • Prevention • Loss reduction & repair (claims repair/mitigate) • Resources • Jim Calloway, OBA Law Practice Management • Carriers, informal regulation through applications, rate-setting, sometimes continuing education or newsletters, informal consultation, claims repair

4. What is the OBA Management Assistance Program? Okbar.org The OBA-MAP is a state-bar sponsored practice management advisor. . . . The OBA Management Assistance Program was created in 1997 to help Oklahoma lawyers better organize and operate their practices. . . . There was also a growing realization in many circles that many bar complaints filed against lawyers were not the result of malfeasance or incompetence in the law, but were the result of poor law office management practices. The use of law office technology was also rapidly changing, reshaping the processes of the traditional law office.

5. What is Practice Management Assistance ? Several other state bars, law societies or malpractice carriers sponsor PMA programs. Most existing PMA programs share these common objectives: • Assisting lawyers in improving efficiency and effectiveness in the delivery of legal services; • Assisting lawyers in implementing systems and controls to reduce risk and improve quality in the delivery of legal services; • Assisting lawyers in client relations; and • Assisting lawyers and their office personnel in using emerging technologies to improve the delivery of legal services.

6. Management Assistance Program • Free Telephone Hotline — The MAP staff attempts to answer brief questions about management and technology issues. Our number is (405) 416-7008. Often we are able to provide callers with a citation to more detailed paper or book with more information about the topic. • Free Consultations at the Bar Center — Any lawyer who is setting up a new practice or has encountered a difficult issue that cannot be comfortably handled over the telephone is welcome to schedule a free 50-minute appointment with the MAP director. • Office “Health Checks” — These consultations take place in the lawyer’s office on a fee for services basis. A wide range of management issues can be covered. Typically all staff and attorneys will be involved both in group and individual interviews.

7. B. Client Management Procedures1. Screen Prospective Clients pp. 373-74 Besides doing required conflicts screening, before undertaking representation evaluate bigger questions: do you & your firm want to represent this prospective client? Or are there telltale signals they will be difficult client?

8. B. Client Management Procedures pp. 372-94 You Want to Undertake, now: ***1. Screen Prospective Clients with thorough conflicts check Fortney & Hanna: Long list of persons whose interests should be analyzed, including lawyers, office staff & their former employers, business interests, and all possible parties & related entities & alliances. Some can be done by sophisticated software; other subtle checks through New Business Memo (NBM), judgment calls require evaluation by rational, cool-headed human actors. N.B. Ethics 20/20 will propose expanding 1.6(b) exception to permit better conflicts screening for lateral hires, law clerks & staff. No controversy expected.

9. Careful process of analysis & appropriate response to potential conflicts: “cold shower” Review: is there potential conflict with current or former client, or prospective or putative client? If so, carefully consider whether it is consentable and whether firm thinks it prudent to seek consent. Proceed cautiously & with attention to details. Client relations problems?

10. 3. Use Non-Engagement Letters pp. 389-90 Martyn: avoid “accidental clients”: adopt strong firm policy to send anytime decides not to represent. Text: Unless prospective client meets with firm lawyer at 11th hour, Martyn/text discourages reference to any specific limitations period so cannot be later claim of reliance on incorrect legal advice. Also: letters to prevent reliance by unrepresented third parties.

11. 4. Obtain signed engagement agmtspp. 390-92 While written agmt not required in most juris’ns (unless it’s % fee), best way to avoid unpleasant disputes re fees, costs, trust accts, billings, scope of representation, client identity, firm staffing, basis for withdrawal or termination, dispute resolution.

12. 5. Cement Client Relations pp. 392-93 Firm procedures: cc C on all correspondence, filing (cheap & convenient) During lulls in activity, ticklers to evaluate whether some status report appropriate. RETURN PHONE CALLS PROMPTLY! Monthly, detailed billings Client audits: How are we doing? Feedback on C satisfaction.

13. 6. Use Care in Terminating Repre’n pp. 393-94 ·When representation complete, per terms of retainer, send closing letter! (no more work will be done, now former C) ·Working L shd prepare closing memorandum, sent to C, clean out supercededworkpapers. ·Follow firm’s written protocol on file retention, in accordance w/ state & fed’l law. Advise C on right to file, per retainer ltr. ·Avoid suit for unpaid fees!

14. C. Administrative & Work Control Systems pp. 394-96 • Administrative errors account for largest category of LM claims, including accurate calendaring & failure to respond to calendar. • Software + hard copy calendars; built-in redundancy in case of disaster. Clinic: Practice Master • Lawyers must calculate deadlines – not delegate to staff. • Master calendar + back-ups • Each open case should have at least one docket date – so regular review • Log all activities

15. D. Human Resources Management pp. 396-402 • Enlightened firm management: lawyers & staff are human, not robots; c/n just focus on bottom line of profitability. Strong + positive ethical infrastructure with back-up systems. • Larger firms: Employee Assistance Programs • Healthy workplace & work/life balance becoming general concern of organized bar & firms

16. D. Human Resources Management pp. 396-402 • Top down leadership: Managing Partners/SH, Partners, Associates, all staff: importance of shared responsibility for quality work product; teamwork approach • In-house Continuing Education • Lateral hires (both lawyers & nonlawyers): training on firm values, risk-management process, protocols. “indoctrination”

17. D. Human Resources Management pp. 396-402 • Internal enforcement mechanisms • Positive reinforcement (by example, right way to act) • If needed, sanctions • Set forth in written firm policy manual • Regularly enforced • Progressive discipline • Transparent & fair evaluation systems • For retention, bonuses, compensation, salary increases, partnership/shareholder status