The Reputational & Financial Value of Open Attorney-Client Communication
Admitting Your Mistakes
The value (reputational and financial) of open client communication
I was recently working on a case that reminded me of the need for open and honest client communication, even when something goes wrong.
An attorney representing a client in a personal injury case missed the statute of limitations deadline. The case was ultimately dismissed by the defendant filing a motion for summary judgment.
The attorney failed to communicate this to the client, initially saying that the case was still progressing, and then a year later instructing his secretary to “take a message.” After calling the Clerk of Court and learning of the dismissal, the attorney’s client became my client – for a legal malpractice suit.
You always love a case — until you get sued for legal malpractice!
During the subsequent legal malpractice litigation, the attorney claimed that the client was bad and the underlying case was weak, so the dismissal was irrelevant because the client would have lost the case anyway. The client’s response was simple, “If my case stunk, why did you take it?” Sorry, but it’s too late for the attorney’s excuses. If the case wasn’t viable and collectible, the attorney shouldn’t have taken it in the first place, or disengaged at the first sign that there was an unforeseen problem with either the client or the case.
When you make a mistake, you really only have two choices:
Tell the truth. Report the mistake to your insurance carrier, whose counsel will help ensure that all disclosures to the client meet Bar Rule guidelines. The client can still sue, and will probably only recover what should have been recovered in the underlying case. However, in the legal malpractice case, your insurance company pays any settlement or judgment. The client can also file a Bar complaint against you, but as long as you tell the truth in the litigation and during the Bar disciplinary process, you may receive minimal or no discipline. You can move on with your legal career.
Hide the truth. For whatever reason, some attorneys foolishly limit communication and hope the whole situation goes away. Guess what. It won’t. By ignoring or hiding the truth, an attorney may be liable for the original claim, plus breach of fiduciary duty claims, conflict of interest claims, and additional damages like attorneys’ fees, litigation expenses, and even punitive damages. At some point the attorney will still have to defend against the resulting Bar complaint, and now risks disbarment or serious disciplinary action for Bar rule violations including dishonesty, misrepresentation, fraud, deceit, candor to the tribunal, candor to a third party, and failure to act diligently. The list goes on and on…
Let’s face it, we are all human, and we’ve all at least contemplated #2 at some point in our careers. Unfortunately, the courts and State Bar disciplinary committees hear too many situations where attorneys allowed ego and short-term reputation to get in the way of long-term career-impacting decisions. Don’t let this happen to you.
Treat good news and bad news with equal enthusiasm
Here are some tips to help limit your chances of making mistakes in the first place:
- In all client situations, assume the buck stops with you. Don’t try to blame associates, paralegals secretaries, or other subordinates. The judge or jury won’t appreciate your blame-shifting excuses while you are under oath on the witness stand.
- When you seek to build co-counsel relationships on cases, interview your potential co-counsel partners like your clients would interview them.
- Before and during the litigation, build a detailed plan with both your client and co-counsel. Include all deadlines for all parties, then calendar and share them with your client and co-counsel. As the case progresses, communicate, make informed adjustments with client approval, and promptly notify your client and co-counsel of those adjustments.
If you make a mistake:
- Don’t panic!
- Check your state Bar Rules to ensure you are following the correct disclosure procedures.
- Contact your insurance carrier to report a potential incident. Depending on your policy, this may be your first call.
- Notify your client. Put it in writing, in case the mistake ends up in litigation or before a State Bar disciplinary committee.
Admit your mistakes, but seek expert counsel first and disclose the right way
Take the hit and admit your mistake to yourself first. If you are not sure whether a mistake was made, speak to another competent attorney. Quickly report your mistakes to your carrier and client without compromising your ethical obligations or your insurance coverage. In some situations, your carrier may help you engage in “claim repair” by disclosing the mistake while trying to fix it or minimize client damage. Limit your liability for additional claims and damages by taking timely and honest action. That said, you don’t need to just throw yourself under the bus. Get experienced guidance on how to disclose properly without voiding your insurance coverage.
Note: Here are some of the GA Bar Rules that apply to the admission and disclosure of mistakes, including the requirement that you can’t prohibit a client from filing a grievance under any circumstance:
Rule 1.7 – Conflict of Interest
Rule 4.1 – Truthfulness in Statements to Others
Rule 8.4 – Misconduct
Rule 9.2 – Restrictions on Filing Disciplinary Complaints