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While it has seemed that Spring has been a bit late in fully arriving to us in Michigan, we all know that May will bring more Spring-like weather. Spring is a time for planting and renewal. It’s no wonder that people get the itch to do some Spring cleaning this time of year. It just feels like the right time to get more organized, clean up, and make some changes.

Speaking of changes, this is also a good time to consider your law practice’s malpractice insurance. Many attorneys think that it would be a big hassle to shop around for alternative policies when it comes to professional liability insurance. However, Paragon Underwriters makes that process quick, simple and hassle-free. We know that change is worrisome for many people. It’s easy to become unduly content with your malpractice insurance over the years and forget that there may very well be better coverage out there. But, it is out there!

A few months before your current coverage is set to expire, we encourage you to reach out to us for a discussion about options that will help protect you and your colleagues should you face the unfortunate experience of a client suing you for legal malpractice. Our insurance agency spends much time researching the new policies available to attorneys like you and we’d love the opportunity to share these details with you (or a representative from your law firm).

We became the best Professional Liability choice for Michigan Law Firms because of our reputation among attorneys like you. For nearly 50 years, we have demonstrated a commitment to providing Michigan lawyers with top-quality, customized professional liability insurance. Call us today, or at least 3 months before your current policy’s expiration date, so we can work together to find you the best coverage.

Most occupational groups have some amount of stress and anxiety as a result of a heavy workload,  and the challenges of daily requirements at the office. For 21st century attorneys, the pressure of representing clients and completing daily work tasks can have negative effects on the quality of work and significantly compromise the successful delivery of services to the clients who pay the law firm.
 
While it is often said that air traffic controllers suffer the most workplace-related stress, studies have shown that attorneys have much more stress than previously thought. The long hours that lawyers have to grind at the office coupled with the weight of responsibility that clients place on them leads to mistakes and grave errors. Being tired and not able to fully pay attention results in a failed representation that can lead to legal malpractice claims.
 

 
Studies underscore lawyers’ personal problems that interfere with their ability to ably represent clients in accordance with a recognized standard of care. This can be a recipe for disaster and can severely affect a lawyer’s reputation and that of the law firm. Lawyers in Michigan who have had malpractice lawsuits brought against them have cited exhaustion and case overload as reasons for their errors. Representing clients can be difficult when there are extenuating circumstances causing attorneys to fall short in the office.
 
Caffeine might be helpful in keeping you awake, but the pressures of daily life can lead to incompetence. This, in turn, leads to potential malpractice claims. At Paragon Underwriters in West Bloomfield, Michigan, we help lawyers protect their interests with professional liability insurance, but we also work with our clients in risk management — finding ways to lessen the exposure to malpractice claims.
 
 
Tags: Attorneys, Lawyers, Professional Liability Insurance, Paragon Underwriters, Malpractice, Law Firms, Risk Management

When speaking with law students and young lawyers about professional liability insurance and risk management, we always mention that we strongly encourage them to specialize. Why do we encourage them to specialize in a particular area of the law? The answer has to do with risk management.

Studies have shown that attorneys who are specialists are less likely than generalists to make a mistake that leads to a malpractice claim. This not only makes sense intuitively, but it is also backed by empirical data. CNA, the largest insurer of attorneys in the country, found that “nearly 70% of all business transactions claims are instituted against attorneys who reported that business transactions practice generated 5% or less of their annual revenues.”

The costs of being sued for malpractice – lost billable time defending the claim, expense of malpractice insurance deductible and a higher premium when you renew, stress, etc., – are so onerous, that attorneys will benefit greatly by reducing their malpractice risk. Specializing in a single area of practice (AOP) is a powerful risk reduction technique, because it enables an attorney to benefit from the “network effect” described above, and eliminates the risk of dabbling in practice areas that an attorney isn’t an expert in, while still producing income via referral fees for cases in other AOPs.

No doubt you’ve been put in the following position (probably several times a year): You’re at a party or family event, and a friend or relative approaches you with a simple legal question. They preface the question by telling you that it’s a minor situation so it won’t take you long to answer. Since it’s someone who trusts you and someone close to you, you don’t think twice about giving legal advice. In fact, you’re happy to do the favor and it feels good knowing you’re able to help them out. Not to mention, you really can respond quickly to their inquiry and save them some money in the process.

Providing legal advice like this can be very tempting for family members and close friends, but it could actually be quite damaging to you professionally. While your intentions are noble (we all want to help those closest to us), your actions might be harmful to you, your law firm and even to the person to whom you’re providing advice. Remember that, as an attorney, when you give legal advice, it can come back to haunt you. Even given casually, your legal opinion may be less thought-out than usual and not backed by the research you would typically conduct if a paying client requested it.

Furthermore, by providing informal, free legal advice like this to friends and relatives, you might be creating a conflict of interest for yourself by giving advice to a person who has not been through a “conflicts of interest” check first. Do you really want to put yourself in that potentially disastrous position? There are much better ways that you can help friends and family without putting yourself into harm’s way.

Paragon Underwriters reminds you that when asked a legal question by a friend, it may appear that you are merely giving advice to someone close to you, but you have to be aware when a relationship becomes a lawyer-client relationship. The minute this relationship is formed, lawyers are bound by the rules of their professional responsibility. The relationship begins when there is a mutual understanding that the client is going to confide in the lawyer and the lawyer is going to listen. The relationship may commence even if there is nothing in writing and even if no money has changed hands. Although there must be a mutual understanding that the client has engaged the lawyer and the lawyer has accepted representation, it is the lawyer’s responsibility to make it clear to the potential client when this has occurred, and when it has not. Defining the relationship with those seeking advice from the beginning can avoid confusion and ethical issues down the road. Providing casual legal advice to a family or friend can result in major legal liability, malpractice, or disciplinary action as the non-clients may have reasonably relied on the information given. Rather than put yourself at risk, make it clear to the non-client that though you are unable to offer them legal advice, you can refer them to legal resources intended to help those who maybe cannot afford representation.

Communication is key in these interactions. If a conversation is turning into professional work, it is the lawyer’s responsibility to either put a stop to it or make it clear that further discussion should take place in a more formal setting. Similarly, when the lawyer has no intention of representing a potential client, the lawyer has the responsibility to communicate that no lawyer-client relationship exists. It is also important to remember that if a family member or friend has a lawyer, you should resist the urge to give a “second opinion”. The fact is the other lawyer has spent a lot more time on the case than you and is familiar with a lot of facts that the person you’re speaking with may not have disclosed. Consider that before telling someone that you would handle a situation differently than that person’s lawyer.