The most common factors leading to legal malpractice claims

Summarizing the discussion during an ABA panel discussion held in Chicago last Thursday, an article published in Friday's Chicago Law Journal states that the top mistakes that lead to malpractice claims are:

--Poor communication between lawyer and client, resulting in disparate understandings of the arrangement.

--Missed deadlines through bad calendaring or failure to know deadlines.

--Poor investigation that misses basic facts.

--Failure to catch errors in work delegated to assistants.

In personal injury cases, blowing the statute of limitations leads the way in malpractice errors, either because the attorney entered the wrong date in the law firm's or lawyer's calendar, the attorney waited for the very last day to file or because the attorney did not know statutory deadlines. Any of these can be used to support a claim of incompetence under Rule of Professional Conduct -- although it is unlikely that a one time ocurrence by itself will result in such a finding.

The second most common reason for malpractice complaints is be familiar to students of Professional Responsibility: the failure to decline the case in time for the plaintiff to find another lawyer. Often a lawyer doesn't make it clear to a potential client whether the lawyer agreed to take the case or is just looking it over. And the lawyer never gets around to actually rejecting the representation.

Evidently, both of these mistakes are pretty basic. In fact, I cover both of them in the classes I teach. In Torts, a first semester class, I tell my students that buying a calendar and learning how to use it is the fist thing they should do after they get a job and that missing the statute of limitations is the dumbest thing they can do. In Professional Responsibility, a third semester class, we cover the issues related to the formation of an attorney-client relationship by discussing the famous case Togstad v. Vesely, Otto, Miller & Keefe which illustrates the importance of letting a client know clearly the decision not to agree to the representation. If a second year law student knows not to make these mistakes, there is no excuse for attorneys in practice to be making them.

More on flat fees

Earlier today I posted a note about when is a flat fee earned (here). I then came across this short comment (here) regarding how disciplinary authorities deal with the issue of whether a flat fee has been earned. In part, it states:

"At present, if a representation ends early, the discipline system will often try to assess what portion of a fixed fee a lawyer earned (i.e., what is “reasonable”) by multiplying the number of hours worked by a reasonable hourly rate. Thus, if a lawyer who regularly bills $200 per hour collects a $5000 fixed fee to prepare a will, but spends only two hours on the will, disciplinary authorities may try to force the lawyer to refund the additional $4600. . . . .

"If disciplinary authorities continue to insist that a challenged fee will be assessed through the hourly billing prism, they will push for fixed fee engagements to be “lose-lose” engagements for the lawyer. . . .

"The limit on reasonableness of fees, commonly Model Rule 1.5, does not require such an outcome."

Sanctions for misconduct during discovery

On Wednesday, a California appeal court upheld a sanction of more than $6,600 after finding that the plaintiffs in a property dispute had engaged in "gamesmanship" in a deliberate effort to bog down discovery. The court held that "the record here strongly indicates that the purpose of plaintiffs' objections was to delay discovery, to require defendants to incur potentially significant costs..." The text of the opinion is available here. For more on the story go to Law.com.

Duty to communicate settlement offer

A couple of days ago I mentioned in class the possibility that a client could sue an attorney arguing negligence in handling a settlement offer. Right on cue, today's news in the Wall Street Journal Law Blog include this item: "Susan Stanford is suing her former divorce lawyer for $200 million, alleging that the lawyer, Nancy Rommelmann, failed to tell her of a verbal offer to settle her divorce for $200 million last year. Click here for the story, from Bloomberg. Stanford filed a complaint (link not available) on Thursday in Houston state court."

Are flat fees earned upon payment or is the attorney simply guarding the money for the client?

There has been a lot of discussion recently on the increasing popularity of "flat fees." So, it is important to understand the possible ethical issues that arise from their use. For example, it is important to know when the fee is actually earned, since the attorney has a duty to return any unearned fees at the end of the representation.

Yesterday, the District of Columbia Court of Appeals published an opinion in which it held that that a flat fee paid to a lawyer remains the property of the client until it is earned. Unfortunately, it is not particularly clear at which point the fee is, in fact, earned. The court simply suggested that whether the fee has been earned will be determined based on an objective reasonableness standard "in light of the scope of the representation" and "in the context of the anticipated length and complexitity of the representation."

The text of the opinion is available here. For more on the story go to the Legal Times Blog and to the Legal Profession Blog.

Breaking news re privilege claim before Congress

Law.com is reporting Bank of America did not meet the deadline to turn over documents to the House Committee on Oversight and Government Reform. The Committee had given the bank until noon today to turn over documents related to legal discussions BofA had with outside counsel before and after it absorbed Merrill Lynch in Dec. 2008. The bank resisted, saying the documents are protected by attorney-client privilege

Go here for the full story.

More on the cases on the law of lawyering pending before the Supreme Court

A few days ago I reported that there are six cases on the law of lawyering pending before the US Supreme Court (see here). Thanks to Renee Knake and the Legal Ethics Forum, here is a list of the issues in those cases:

(1) Do provisions of the Bankruptcy Abuse Prevention and Consumer Protection Act regulating attorneys’ advice to clients and mandating certain advertisement disclosures violate the First Amendment? Milavetz, Gallop & Milavetz, P.A., et al. v. United States, 541 F.3d 785 (8th Cir. 2008)

(2) Is an attorney’s faulty advice grounds for setting aside a criminal defendant’s guilty plea? Padilla v. Commonwealth of Kentucky, 253 S.W.3d 482 (Ky. 2008)

(3) When, if ever, does a novice attorney’s inexperience constitute ineffective assistance of counsel? Wood v. Allen, 542 F.3d 1281 (11th Cir. 2008)

(4) Should a court’s order compelling production of privileged materials be immediately appealable? Mohawk Industries, Inc. v. Carpenter, 541 F.3d 1048 (11th Cir. 2008)

(5) Can quality of performance and results obtained justify an enhancement to an attorney’s fee award under a federal fee-shifting statute? Perdue v. Kenny A, 532 F.3d 1209 (11th Cir. 2008)

(6) May a prosecutor be liable for civil damages for procuring false testimony and introducing that evidence against a criminal defendant at trial? Pottawattamie County v. McGhee, 547 F.3d 922 (8th Cir. 2008)

Does the attorney-client privilege apply in Congress?

A Congressional committee is prepared to require Bank of America to reveal information it has withheld from the SEC and AG Cuomo on grounds of privilege. Numerous members of Congress have claimed over the years that the privilege doesn't apply in Congress. The privilege gives a client the right to prevent disclosure of information in a proceeding where the rules of evidence apply. Since the rules of evidence do not apply in a hearing before Congress, it follows that the Committee would not be persuaded by the argument that the witness can object to disclosing the information. Yet, the Bank claims that disclosing the information in Congress may consitute a waiver in other proceedings where the privilege would apply. Also apparently there has been a practice of allowing witnesses to claim the protection of the privilege during Congressional hearings in the past. Apparently, no court has ever decided the issue and there is very little literature on the subject. It will be interesting to see what happens.

Video on Alton Logan's case

Last week in class we discussed the duty of confidentiality and some of its exceptions. During our discussion I mentioned a 60 Minutes segment about the case of Alton Logan, who was recently released from prison based on the testimony of two attorneys who knew he was innocent but did not say anything for 26 years. The case raises the question whether it would be a good idea to add another exception to the list in Model Rule 1.6(b). Here is the 60 Minutes segment in its entirety. It starts after a short commercial and is about 12 minutes long. (You can view it in full screen by clicking on the square icon in the lower part of the image.)

Judge issues warning to attorney for filing frivolous case arguing Pres. Obama is ineligible to serve as president

U.S. District Court Judge Clay Land has issued a stern warning to attorney Orly Taitz and others in the so-called “birther” campaign to stop filing “frivolous” lawsuits. Land threw out the lawsuit filed on behalf of Capt. Connie Rhodes who is an Army surgeon challenging her deployment orders due to President Barack Obama’s alleged ineligibility to serve as President. Land held that the claim presented no credible evidence and made no reliable factual allegations to support her unsubstantiated, conclusory allegations and conjecture that President Obama is ineligible to serve as president of the United States and that, "[i]nstead, she uses her complaint as a platform for spouting political rhetoric, such as her claims that the president is ‘an illegal usurper, an unlawful pretender, [and] an unqualified imposter.’” Land then warned the lawyer who filed the claim that he may impose sanctions if she files any more “similarly frivolous … actions in this Court.”

For more on this story go here (incl full text of the opinion) and here.

Minnesota Supreme Court suspends judge who referred clients to his own lawyer

The Minnesota state supreme court has suspended a judge for six months without pay for steering matrimonial mediation cases to his own divorce attorney. The court's opinion can be found here. Prof. Jonathan Turley has more on the story here.

Judge strikes DuPont defenses because of misconduct during discovery

Saying that DuPont engaged in "a deliberate scheme to interfere" with the court's rulings during more than a decade of litigation, a judge has struck the DuPont's defenses in two companion cases. Go here for the full story and more links.

Conviction upheld even though the judge and prosecutor were dating

The Texas Court of Criminal Appeals — the state’s supreme court on criminal matters — has ruled that a man facing the death penalty for murder will not get a new trial despite the fact that the prosecutor on the case and the judge who tried the case were at the time involved in a romantic affair. Oh, and by the way, eight of the nine judges who decided the case had previously served on the same bench as the judge who is at the center of the controversy.

For the full story, comments and links to other sources, go here and here.

Over at Legal Ethics Forum, Prof. Andrew Perlman adds: "Notably, and again not surprisingly, the Texas court's order offers no legal analysis or reasoning. It simply offers a bare bones conclusion: "We find that the allegation fails to satisfy the requirements of Article 11.071, § 5(a)." And why is that, exactly? If a law school graduate offered that as "legal analysis," it wouldn't suffice to pass the bar exam. Apparently, it suffices for Texas judges in capital cases when one of their former colleagues is accused of misconduct. This is not the first time that I've seen a state court in a capital case summarily reject a strong argument without any legal analysis, and it is unlikely to be the last. Kudos to the dissent for actually addressing the evidence and issues that were presented."

UPDATE on this story April 21, 2010.

More on the slow death of the billable hour

I have blogged in the past about the debate on whether the billable hour system of billing is losing its popularity (here).

Today, in an article in the Wall Street Journal law blog, Ashby Jones states that "Dating to about five minutes after the billable hour was born, folks have been predicting its death. But throughout it all, no other billing method has come close to knocking the billable model from atop its lofty perch. Until now, it seems. According to an article in Legal Week, both Mayer Brown and Reed Smith are looking hard at moving to fixed or capped fees for their transactional work. is looking to move away from traditional hourly billing models, with plans to bring in fixed or capped fees for transactional work."

For the full article go here.

Six cases before the Supreme Court on the law of lawyering

There is a very interesting note at the Legal Ethics Forum, pointing out that the United States Supreme Court will hear no fewer than six cases related to the role of attorneys and the practice of law during the current term and asking what might be the consequences to regulation of the profession.

Morning cartoon

Go here.

"Professionalizing Moral Engagement"

I usually start my course on Professional Responsibility with a discussion of a case where a lawyer is faced with a representation that has troubling moral implications. I ask my students to list options for the attorney. When we step back and look at the list, we usually find a very clearly defined spectrum... from quitting the job (or the profession entirely) ... to doing what the client wants and not caring about anything else (complete "detachment" or, as one of my students called it this year, becoming a "robot"). Somewhere in the middle, but usually not the first option suggested, someone asks, why not talk to the client about it?... and then someone says because maybe the client will think you are weak, or because that's not what the client wants to hear, etc... And so goes the discussion. Good stuff.

We usually agree to disagree on exactly what is the best course of action for that particular case but we do agree that as lawyers we often will have to face some level of moral detachment.

Coincidently, I just came across a note in the Legal Ethics Forum about an article by Prof. Rob Vischer on this subject called Professionalizing Moral Engagement (available here) which proposes that the professional norm should be the opposite of moral detachment. Here is the abstract:

This essay is an invited response to Michael Hatfield, who argues that the legal profession might avoid creating lawyers willing to “sign off on torture if their professional education did not begin with dis-integrating the skills for intellectual agility from the skills for moral resolution.” I contend that we do not need lawyers to reach “moral resolution," for it is not the lawyer’s job to resolve the moral questions that clients face. We do need lawyers, on the other hand, to ensure that clients are aware of the moral questions that are often embedded in the legal questions raised by the representation. Lawyers’ recurrent failure to raise moral questions infringes on client autonomy by precluding the client’s ability to fully consider what is at stake in the case. Our approach to professional formation both during and after law school almost totally ignores this “moral due diligence” dimension of the attorney-client relationship. Especially in cases where the governing law is indeterminate, lawyers need to be able to engage their clients in a moral dialogue, which requires both familiarity with, and sensitivity to, moral reasoning. But lawyers’ capabilities in this regard should not be deployed in order to resolve the moral questions; rather, they should be deployed in order to assist the client in resolving the moral questions. The essay lays out some possible avenues by which legal education can support the project of professionalizing moral engagement.

Another question re adequate sanctions? What do you think...?

Let's assume that an attorney devotes a substantial amount of time to preparing an appeal brief, but, even after having been granted five extensions, was unable to submit the brief in a timely manner. Then the attorney decides to try to get away with it by placing a back-dated stamp on the envelope and lying to the court about whether the brief was filed on time. In fact, the brief was four days late. After doing all this, the lawyer feels too guilty and decides to confess. The court dismisses the appeal and the lawyer has to face a disciplinary procedure. What sanction would you impose?

The Colorado Hearing Board imposed a suspension of one year and one day, with all but 60 days stayed, and probation for two years. The board gave significant mitigating weight to the attorney's "admirable action in self-reporting [the] misconduct." But for that factor, the board states that disbarment would be the appropriate sanction.

Go here for a copy of the opinion. Thanks to the Legal Profession Blog for the information and link.

Another example of inadequate sanctions

Here is a summary of a new case out of California, taken from the Legal Profession Blog, that in my opinion illustrates my point regarding inconsistency and inadequacy of sanctions.

In this case, the attorney stipulated that he was incompetent, that he kept money that belonged to the client and that he entered into a business transaction with a client without fully disclosing the terms of the transaction. In other words, he stole money from the client and abused his position to take advantage of the client. The client had to go through the trouble of hiring another attorney to sue this attorney to recover the money the attorney had stolen. And the only mitigating circumstances apparently were that he had no prior disciplinary record and that he "cooperated with the bar’s investigation." In other words, that he confessed.

And for all this all he got was a 60-day actual suspension (plus probation for one year -- during which he can continue to practice, of course) and was ordered to take the MPRE within one year. What a joke!

The facts of the business transaction part of the misconduct are interesting: In lieu of attorney fees, the attorney accepted two Japanese military pieces, a helmet and a hand sword guard. Without obtaining an expert appraisal, the attorney and his client agreed the sword was valued at $1,500 and the helmet at $2,500 to $3,500.

Accepting things other than money as payment for services is not inherently wrong, but any such transaction is very well regulated by the rules of professional conduct. The transaction has to be clear and fair. In this case, in violation of the rules of professional conduct, the attorney did not advise the client to seek independent legal advice or put the terms of the arrangement in writing.

For the full story and links, go here.

Another example of why light sanctions set a bad example.

I have argued before that it is difficult to understand why a state would not disbar an attorney who steals from his or her client. (See here, here and here, in just the past few months.)

Now comes a new example of the problem. The Legal Profession Blog is reporting today that the District of Columbia Court of Appeals has disbarred a lawyer for his cumulative conduct over more than ten years evincing 'non-negligent misappropriation and dishonesty...' and other misconduct. The opinion is available here.

Ten years!? It took ten years of misappropriation and dishonesty to get rid of this guy?!

But wait a minute, they did disbar him; so what am I complaining about?

Well, here it is: the lawyer in this case had already been disciplined (back in 2001) for similar conduct. At that time, the hearing committee recommended disbarment but the Board on Professional Responsibility and the Court rejected that recommendation in favor of a mere six-month suspension. Way to set a great example with a nice slap on the wrist, guys! Much good it did. And so a lawyer was allowed to continue to engage in misconduct for another 8 years.

As Mike Frisch, of the Legal Profession Law Blog states -- and I agree -- if the recommendation to disbar had been followed 8 years ago, a lot of time, trouble and additional victims would have been avoided.

Fine for violating "waiting period" provision

Last night in class we discussed advertising and solicitation. The last case we talked about was Florida Bar v. Went for It, where the Supreme Court held that waiting period provisions are constitutional. Soon after that decision, a number of jurisdictions adopted similar provisions and others were enacted into specific statutes. One of these statutes is a federal law that deals with aviation accidents. In class, I argued vociferously that this decision is contrary to logic and to accepted principles of constitutional law. Justice Kennedy wrote a great dissenting opinion with which I agree.

Now, "right on cue", Law.com is reporting today that a prominent New Jersey personal injury lawyer was fined $5,000 for sending solicitation letters to families of passengers killed in the February crash of commuter jet in Buffalo, N.Y. A federal statute bars unsolicited contacts by lawyers with victims or their families within 45 days of an air-carrier accident. [See full text of letter here.] Go here for the full story.

Also note that back in February I discussed the waiting period provision in New York also in the context of the Buffalo plane crash. See here.