5 Takeaways from the Newly Released 2015 Profile of Legal Malpractice Claims
Recent blog posting by Joe Kingma.
Just last week the ABA’s Standing Committee on Lawyers’ Professional Liability (LPL) released its Survey of Legal Malpractice Claims 2012-2015. Items of note include:
1. Total legal malpractice claims increased by 20% from the 2012 survey. This might appear to be a big increase but it looks small when you read on.
2. There was a huge increase in the number of claims in which claimants received over $1 million. There were only 52 such claims reported in the 2011 study but there were 440 such claims reported in the 2015 study for more than a 700% increase. Perhaps you should check my math, as a lawyer with a calculator is a scary thing; nonetheless, we should all check our limits and make sure we have enough coverage in a world of big dollar claims.
3. Total real estate claims dropped 21% when 2015 is compared to 2012. This is true despite the fact that commercial real estate transactions have increased during that time and many commercial real estate lawyers are experiencing the best of times. Not many real estate deals are failing and that helps keep the pressure off the lawyers who do the deals.
4. 46% of the claims arose from administrative errors, client relations or intentional wrongs. While this is a slight reduction from prior surveys, it still emphasizes the importance of basic blocking and tackling.
- Keep your administrative machine running smoothly, return client calls, be nice, don’t intentionally hurt your client, and your E & O risk is cut in half.
- The seamless web of the law is vast and can’t be perfectly understood by any of us. Let’s all do the easy stuff and reduce our risk dramatically.
5. Claims against bankruptcy and collection lawyers have only dropped off about 4% from the 2011 study to the 2015 study. Despite the precipitous decline in consumer bankruptcy filings, commercial bankruptcy filings are said to be on the rise and so are claims against the lawyers involved.
The Standing Committee puts out the Profile on Claims every third year and also sponsors two great conferences annually. If you are interested in getting involved in our work feel free to reach out to Joe Kingma or just say hello at our spring meeting in Boston.
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