According to the ABA, as many as 4 in 5 attorneys will face a legal malpractice suit during their career. Moreover, the majority of malpractice claims are brought against small law firms.
Facing a legal malpractice case can be disastrous for a law firm, both financially and reputationally. In times of change and economic uncertainty, attorney malpractice cases result in higher and more damaging settlements.
However, just because it’s a fairly common problem doesn’t mean attorney legal malpractice should be considered inevitable. Learning the common factors that lead to malpractice and adopting some common-sense client and case management best practices can go a long way in avoiding an embarrassing and expensive situation.
What Is Legal Malpractice?
Legal malpractice occurs when a lawyer mishandles a case, causing the client harm or damages by professional negligence. An exact legal malpractice definition varies from state to state, but malpractice is typically when a lawyer fails to fulfill their professional duties in a way that has a provable effect on the case’s outcome.
To understand what attorney malpractice is, it’s also important to understand what it’s not.
It’s not automatically considered malpractice anytime a lawyer makes an honest mistake – many mistakes do not fit the criteria for malpractice at all.
Conversely, malpractice claims are not reserved exclusively for lawyers who are deliberately defrauding their clients or acting maliciously.
Examples of Legal Malpractice
Legal malpractice can take many forms, but it generally involves a failure by an attorney to provide competent and ethical representation that causes harm to the client. Below are a few common examples that illustrate how malpractice may occur:
1. Missing a Filing Deadline
Failing to file a lawsuit, appeal, or other critical document on time, especially when it results in the loss of the client’s legal rights, is one of the most frequent grounds for malpractice claims. For instance, if a lawyer misses the statute of limitations for filing a personal injury lawsuit, the client may lose the chance to recover damages altogether.
2. Conflict of Interest
If a lawyer represents two clients with opposing interests or fails to disclose a personal or financial conflict, this can undermine the integrity of the representation. For example, an attorney who represents both sides in a real estate transaction without proper disclosure may face a malpractice claim if one party suffers harm.
3. Inadequate Legal Strategy or Preparation
Attorneys are legally required to keep client funds in a separate trust account and to use those funds solely for their intended purpose. Misusing or misappropriating client money can constitute serious malpractice and may also result in disbarment or criminal charges.
Common Causes of Legal Malpractice
Legal malpractice can be avoided by understanding the common causes. Additionally, honing both soft and hard lawyer skills can assist in preventing the common pitfalls below:
Conflict of interest: Lawyers cannot represent clients with opposing interests without the proper legal disclosure.
Poor or inadequate communication: Failure to inform clients of important offers and dates can result in missed opportunities or deadlines. This often stems from poor calendaring systems or a lack of follow-up, which can easily escalate into a malpractice claim if the oversight results in harm such as financial loss or dismissal of client’s case.
Insufficient knowledge: Providing incorrect legal advice due to a knowledge gap or failure to keep up with current legal developments can result in malpractice.
Elements Required to Prove Legal Malpractice
Filing an attorney legal malpractice suit is notoriously complicated because there are very specific elements that must be proven, including:
Duty: A duty of care was established.
Breach: The lawyer failed to meet the expected standard of care.
Causation: The aforementioned breach directly caused harm to the client.
Damages: The client suffered actual losses due to the breach.
Duty
An attorney’s legal advice or help can only be considered harmful to someone if they entered into a formal attorney-client relationship, or duty of care, first. Usually, this is demonstrated by showing there is a written contract or agreement between the lawyer and their client, but that is not always the case. If communications or other actions show that an attorney is offering their services, then it might be deemed that an attorney-client relationship exists without a written retainer agreement.
Each state bar's ethics rules determine what exactly qualifies as a formal attorney-client relationship. Therefore, it’s best to double-check and be overly cautious when advising a prospective client.
Breach
While it’s unreasonable to expect an attorney to be perfect or win every case, they should provide a level of representation that meets basic ethical and professional standards. If an attorney fails to perform their duty at a level on par with their peers, it can be considered negligent.
Some examples of negligence include:
Filing the wrong paperwork
Missing a deadline or statute of limitations
Failure to hire appropriate experts
Breaching confidentiality
Failure to apply the law appropriately
Settling a case without the client’s authorization
Failing to communicate with a client
Trying and failing to win a case in good faith is not negligence. However, malpractice in law claims can be based on a lawyer’s action or inaction. In other words, things like simply forgetting to file a court document or responding to an email can put your firm at risk.
Causation
To successfully pursue a legal malpractice claim, clients must demonstrate more than just their attorney's error (breach of duty). They must also establish a direct link, known as causation, between the attorney's mistake and the resulting harm or financial damages they experienced.
For example, if a lawyer misses a filing deadline, like in Scott Martin v. Andrews Kurth LLP (2015), the client must prove that the case would have likely succeeded if the deadline hadn’t been missed.
Financial Damages
Proving that an attorney’s actions directly caused financial harm can be difficult. In other words, the client must be able to show that if their lawyer had acted differently, the outcome of their case would have changed. If the outcome of the case would have been the same regardless of an attorney’s actions, then it would not be considered malpractice.
The financial damages in a lawyer’s malpractice claim can also include fraud or accounting errors, including:
Commingling funds from trust and operating accounts
Abuse of a client’s trust account or misuse of funds
Incorrectly billing hours or fraudulently billing hours
Legal Malpractice Statute of Limitations
The statute of limitations for legal malpractice sets a strict time limit on how long a client has to file a lawsuit against an attorney for professional negligence or misconduct. Depending on the state in which you practice, clients may have anywhere from one to six years to claim malpractice. Check with your state’s laws to determine the exact time frame applicable in your jurisdiction.
What Happens if a Lawyer is Found Guilty of Malpractice?
If legal malpractice is successfully proven in court, the client's ultimate goal is to reclaim the losses they sustained.
Civil malpractice: If a lawyer’s negligence wasn’t intentional, it would fall under civil malpractice, which typically results in fines and sometimes sanctions. The punishment in civil cases is mostly to recoup the client’s financial losses. In many instances, attorneys may settle the case out of court to avoid a costly trial and admission of guilt.
Criminal malpractice: If an attorney is caught defrauding a client or their negligence is due to intentional actions or malicious intent, then the malpractice is considered criminal. Unlike civil malpractice, criminal malpractice carries stiff penalties, including fines, disbarment, and even jail time.
How to Avoid Attorney Malpractice
The truth is, most attorneys do not intentionally or maliciously make mistakes that harm clients. Often, a law firm’s lack of modern client and case management systems is what ultimately leads to honest mistakes that snowball into professional negligence.
Implementing a calendaring system and using tools specifically built to follow legal best practices can go a long way toward avoiding the most common malpractice in law scenarios.
Here are a few basic tips to protect your firm from legal malpractice risk:
Choose Your Cases Carefully
Get to know your potential clients before the case starts to avoid problems down the line. Set up a convenient, but thorough, client intake process to spot potential conflicts of interest or red flags.
While it’s tempting to always take a case and increase revenue, being more selective is the better and less risky option in the long term.
Approach potential clients with the same detail-oriented, professional mindset you would a business relationship.
Don’t be afraid to refer clients to another attorney if the case isn’t a good fit for your skill set.
Straying too far from your typical practice areas and comfort zone is a recipe for causing misunderstandings or mistakes that can turn into a malpractice claim. While referring clients elsewhere might feel like you’re giving
business away, a healthy relationship with other attorneys can lead to more clients coming your way later.
Don’t Rely Solely on Verbal Communication
For clients, getting legal help can be one of the more stressful times in their lives, and part of a successful lawyer’s job is to have excellent client communication skills. While phone calls and face-to-face conversations can be invaluable, always follow up any verbal communications with an email or written message that:
Summarizes the conversation
Confirms any instructions or to-do items
Sets expectations for future milestones
This not only protects you from accusations of negligence later on, but it also gives you a chance to clear up any misunderstandings before they become a problem.
It can also be a good idea to set clear expectations regarding communication during the intake process, including:
Your availability
How long it takes to respond to communications
Who will be responding to their questions
Where they should ask questions (email, client portal, etc)
Utilizing a legal case management software like MyCase is invaluable for effective client communication as it gives clients and attorneys a secure and convenient way to stay in touch. Additionally, keeping client communications in a client portal instead of email ensures all the relevant details of a case are easy to access and in one place.
Use Legal Calendaring Software
Even the best attorneys make mistakes, but if that mistake is missing a deadline or an important meeting, it might become something worse. Instead of relying on paper calendars to juggle multiple cases, leading law firms increasingly turn to legal calendaring software to get full team and client coverage.
Modern case management solutions can centralize all appointments, meetings, and events into one calendar to make sure nothing slips through the cracks. Additionally, attorneys can have even more peace of mind by setting up automated or pre-scheduled reminders and updates. By minimizing the risk of missed deadlines or overlooked communications, these tools play a key role in preventing the types of oversights that often lead to malpractice claims, such as financial loss or case dismissal.
Keep Detailed Records
When a case doesn’t turn out as expected, especially during hard economic times, a client’s first instinct might be to blame their attorney. If you do not have the documentation to defend yourself against a claim of negligence, then you are putting your law firm at risk. With manual time tracking and data entry, crucial details get lost or are harder to refer back to later.
Legal case management software like MyCase has built-in time tracking and document management capabilities to help reduce your malpractice risk. Modern solutions can even automatically track time spent on calls and emails for every case, creating an easy-to-follow paper trail. Better time tracking also ensures you don’t accidentally mix up billable and non-billable hours or run into other preventable ethical issues.
In addition to time tracking, it’s important to digitize your legal records storage for future reference. Digital documents are more secure and easier to organize, simplifying how you maintain legal document compliance.
Consider Malpractice Insurance
Some states require legal professionals to carry malpractice insurance, but even when it’s not legally required, it might be a good idea to consider getting it anyway. Further, some practice areas, like real estate or commercial law, are more prone to malpractice in law claims than others.
While you may have no history of malpractice claims against you, that doesn’t mean it’s impossible, and even if a claim is bogus, malpractice cases can be complicated and a major drain on your firm’s resources. Malpractice insurers often retain attorneys who specialize in malpractice cases, allowing you to get expert advice when trouble arises.
It’s important to weigh whether or not the costs of the insurance premiums are worth it for your business. However, if you decide to get it, make sure you do your research to know what your policy will cover.
Leverage Legal Technology to Reduce Risk
These days, more people are doing important tasks online, including getting legal help. But while digital spaces are more convenient, they also create more opportunities for even honest mistakes and misunderstandings to become potential malpractice claims against your firm.
Leading law firms rely on case management software to centralize their client communication, calendaring, billing, and more. By leveraging a modern solution, you can easily implement more convenient systems and reduce the risk of missing deadlines and other common mistakes.
Schedule a demo or try MyCase risk-free with a 10-day free trial. We offer affordable monthly and yearly subscriptions. Plus, no commitment or credit card is required, and you can cancel anytime.
About the author
MyCase Team