Law Firm Supporting Staff: Recognizing Their Role in Avoiding Legal Malpractice Claims

They hold various titles for their daily roles in the practice of law: paralegal, legal secretary, paraprofessional, law clerk, project assistant, docketing clerk, research assistant, and the list is ever expanding. Regardless of their title, members of law firm support staff serve a critical role in the daily practice of law. Their work, when performed with proper guidance and supervision, not only keeps a legal practice running but also helps to mitigate and avoid legal malpractice claims. Over the entire span of a client representation, law firm support staff is critical to supporting the development and maintenance of professional attorney-client relationships.

Notably, support staff has a serious impact on professional liability exposure. Data from the American Bar Association’s Profile of Legal Malpractice Claims shows that administrative errors (procrastination in performance; lost file, document or evidence; failure to calendar properly; clerical error; failure to file document – no deadline; failure to react to calendar) leading to malpractice claims peaked in the 2011 study at 30.13% of total errors claimed. In the 2015 study, however, the administrative errors had decreased to a more typical 23.15%.

Although no known specific cause was identified for the uptick in legal malpractice claims related to alleged administrative errors, it may have been related to the economic downturn. As attorneys adapted their law practices to survive the economic downturn, many ventured into new areas of practice bringing their law firm support staff with them. Without proper guidance and supervision, and lacking a mentor to address uncertainties about the new area of practice, errors were made related to proper filing of documents, clerical errors, failure to file documents among other issues, which involved steps completed by support staff. As the legal community recovered from the economic downturn, legal malpractice claims based on administrative errors returned to customary historical numbers, but still remained in the double digits. Thus, opportunities exist throughout all stages of the client representation for support staff to more effectively support law firm operations and thus reduce the risk of a professional liability claim.

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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.

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Introduction

The evolving nature of legal practice requires continuous adaptation by attorneys and those who work to support them in their daily practice. Over the years, attorneys have adapted from using books for researching case law to online databases. Attorneys also must remain conversant with charges in statutes, regulations and case law. Similar to other professions, the practice of law has migrated from the use of physical files and written letters to cloud computing and email communications with clients. Clearly, the emergence of social media represents the most recent frontier in the ever-changing information age. The influence of social media on legal practice, client relationships, and the boundaries between professional and personal activities must be scrupulously navigated.

This guide will provide an overview of ethics concerns, practice challenges, potential benefits and pitfall of social media use related to the practice of law.

Attorney and Law Firm Social Media Presence

For more than twenty years, the American Bar Association (“ABA”) Legal Technology Resource Center has been publishing the Legal Technology Survey Report. 1

The most recent ABA TECHREPORT 2016 revealed a significant increase in law firm social network presence, from 17% in 2010 to 74% in 2016.2 The 2016 report also notes that law firms and individual attorneys are participating in social media to serve professional purposes.

The 2016 ABA TECHREPORT found the following law firm social media presence:

• LinkedIn: 78%
• Facebook: 57%
• Blogs: 26%
• None: 26%
• Don’t Know: 10%

The report further demonstrated that LinkedIn, as a professional and career-centered social media forum, appears to be more suited to the legal environment than other social media sites. In contrast to Facebook, LinkedIn focuses on professional status and advancement. A law firm posting about a successful case, therefore, seems more appropriate in a forum focused on careers, rather than one integrated with personal posts about politics, personal milestones, and other informal references.

Attorneys participating in the ABA TECHREPORT indicated the following as to the reasons for participating in social media:

• Career Development/Networking: 73%
• Client Development: 51%
• Education/Current Awareness: 35%
• Case Investigation: 21%

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Background

Twenty-two years have passed since California voters passed Proposition 215, permitting the medical use of cannabis in the state. Since then, twenty-nine more states have followed California’s lead,1 with nine of those states and the District of Columbia also authorizing recreational cannabis use.2 Legalization at the federal level seems inevitable, but predicting a timeline for meaningful, long-term congressional action has so far been a fool’s errand.

In the meantime, cannabis growers, dispensaries, and ancillary service providers (“cannabis clients”), along with the professionals who represent them, are captive to the whims of each successive White House administration. Under President Obama, this meant assurances that the federal government would not interfere with state cannabis regimes pursuant to the Cole Memorandum, issued by the U.S. Department of Justice. President Trump, on the other hand, has offered no such assurances, and U.S. Attorney General Jeff Sessions rescinded the Cole Memorandum in January 2018.

Ethical Duties

The primary ethical consideration for attorneys representing cannabis clients is American Bar Association (“ABA”) Model Rule 1.2(d), which prohibits attorneys from “counsel[ing] a client to engage, or assist[ing] a client, in conduct that the lawyer knows is criminal or fraudulent” but adds that “a lawyer may discuss the legal consequences of any proposed course of conduct with a client and may counsel or assist a client to make a good faith effort to determine the validity, scope, meaning or application of the law.” This language has been incorporated into every state’s version of Rule 1.2 with only slight variations.

Cannabis is illegal under federal law, and in the wake of state legalization efforts state and local bar associations grappled with the conflict between Rule 1.2 and the cannabis industry’s need for legal services. With few exceptions, the majority of ethics opinions concluded that providing advice to cannabis clients is consistent with Rule 1.2 as long as the attorney also advises the client about related federal law and policy. Exactly what this disclosure might entail is discussed in the following section.

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Attorneys have to make decisions each day of their professional lives. Selecting legal malpractice insurance is certainly one of the most important decisions you will make. A law firm should do significant research before choosing which insurer to go with for their lawyers' malpractice insurance. At Paragon Underwriters, we have put together some helpful tips to consider before making that selection.

Look at the Forest for the Trees

Remember to look at the big picture rather than starting out by being overly specific with the details. Evaluate what the insurer is offering as well as that company’s financial stability and credit rating according to AM Best. Also, think about the agent’s past experience and reputation. Ideally, you'll want to stay with this insurer for a long time so consider this a long-term commitment and make sure you feel comfortable with both the agent and the insurer.

Experience

As the famous football coach, Vince Lombardi, said, "Practice does not make perfect. Only perfect practice makes perfect." Look into how long the insurer has been in business and what type of experience they've had. Just because an insurer has been around forever doesn't tell you enough about their success, culture or how they treat their clients. Before signing anything, you'll want to know if the insurer has specialized knowledge of lawyers’ professional liability insurance. You’ll also want to know if they are new to offering professional liability insurance or if they have a well-established book and proven track record.

Specialization

There are a lot of insurance agents out there. There are, however, very few who truly specialize in legal malpractice insurance. This highly specialized field has certain nuances that make it easy to miss key factors. Firms like Paragon Underwriters have been specializing in professional liability insurance for attorneys for nearly 60 years and have made this our niche. We know this part of the insurance industry better than most other firms, especially a general insurance agent who does mostly home, auto and business insurance – that agent may do one of these policies in his entire career, we do them all day every day and insure nearly 1,000 law firms in Michigan.

The Financial Stability Factor

Will you be able to rest assured that you're covered? After all, you have a lot at stake with your law firm. It's more than simply a financial decision to make. Your reputation as an attorney and your firm's reputation is on the line. You need to be positive that the malpractice insurer has the ability to continue to pay claims into the future.

We're in a Commitment Here

With claims-made coverage business, there's an easy entry to market for new malpractice insurers. Therefore, many new insurers target specific markets to collect as much premium as possible, but they won't be around when the claims come in. You want to ensure there's a commitment on the part of the insurer to stick around when the worst happens and you need the claims to be paid.

What's the Insurer's Reasoning

Finally, make sure to research the insurer's claims philosophy. What type of consideration do they put forward to determine whether to pay a claim? Will they be the type of insurer to fight for every dollar or will they be willing to settle without a struggle?

At Paragon Underwriters, we want to see you succeed. We sincerely care about our clients and help steer them toward smart, financially prudent decision making. We believe the relationship between the insurance agent and the law firm is a very important factor in determining the best coverage and the best insurer to use. We will provide additional insight as to which insurer best fits your needs. These decisions take time and we believe in calculated decision making. We will begin to work with you early on in the process and ensure the insurer is the right choice for your firm. That's why we're here... to serve you and to always have your best interests in mind. Call us today to start the process and we guarantee you'll be happy with the experience.