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    Managing Risk: 10 Ways to Avoid Spending Your Deductible

    Here are 10 ways to manage your everyday risk-management strategies to avoid spending your legal-malpractice insurance deductible.

    Thomas J. Watson

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    Wisconsin LawyerWisconsin Lawyer
    Vol. 84, No. 5, May 2011

    Brilliant legal work is sometimes not enough to insulate you from grievances or legal-malpractice claims. ABA claims statistics nationally show that a lawyer can expect, on average, three claims in the course of his or her career. Mistakes happen. It’s a fact of life. That’s why you have malpractice insurance.

    There are, of course, things you can do in your everyday practice to help minimize the risk of a claim. In addition, periodically assessing your risk-management strategies, including selecting clients, managing client expectations, billing, and calendaring, can help you better represent your clients. Wisconsin Lawyers Mutual Insurance Co. president and CEO Katja Kunzke recently presented a program focused on helping lawyers assess how they manage those strategies and avoid malpractice claims. She calls it her top 10 ways to avoid spending your legal-malpractice insurance deductible.

    1. Stop lying to your calendar about who is in charge of your life.

    Twenty-three percent of all claims and 28 percent of all claim dollars result from lawyers missing deadlines because they don’t calendar enough time for the “unexpected.” When was the last time you had a day without the unexpected? Kunzke, who ran WILMIC’s claims department for 14 years, says, “Calendar as though something bad will happen.”

    Attorney Terry Dunst, with Bakke Norman in Baldwin, says, “I do find that tasks sometimes take longer than the time I’ve put on my calendar. Maybe a client meeting takes longer than expected. I always try to be careful to not be led astray by the latest emergency. What I mean by that is I try not to be pressured or manipulated into making the most recent emergency the most important thing on my to-do list.”

    Kunzke adds, “Allow for time to fix mistakes. Allow more time to get it done than you think necessary. You might even consider including it in someone else’s calendar in the office so they can bail you out if necessary.”

    Milwaukee solo practitioner Gwen Connolly does things a little differently than many attorneys. She is the only person who handles her calendar. “I do not allow my assistant to calendar my schedule with the court. This permits me the opportunity to evaluate as dates are set relative to my other cases whether I have sufficient time to accomplish other tasks for my other court-ordered deadlines.”

    2. “No” is a complete sentence.

    Our claims attorneys often hear the refrain, “I knew I shouldn’t have taken that case.” Facing real people in real crises makes it difficult to always make the right decision about which cases to choose. And turning away business is never easy. Solo practitioners and small firms often feel they cannot be choosy about the clients they select.

    Kunzke says, “Lawyers need to believe they can say ‘no’ and the phone will ring again. It doesn’t take long to learn the clients you shouldn’t have taken.”

    Don’t take cases strictly for financial reasons. It can be tempting to take everything that comes in the door. But you may end up with a case outside your area of expertise. A lawyer who accepts such cases is what Kunzke calls a dabbler. “A high number of malpractice claims are directly related to this problem,” she says. “Don’t be afraid to refer a case if you do not have the required expertise.”

    Some lawyers stay away from representing a client who has already had at least one other attorney. For one thing, having had multiple attorneys may indicate that the client will never be satisfied, no matter who is representing him or her. Also, how long before the client leaves you? Will the client cooperate? Is the client going to make demands that are unrealistic or unethical?

    Connolly says her red flags include a gut check. “I try to assess honesty and reliability. I am very direct with clients.” Connolly says potential clients have to talk to her assistant before they get a meeting with her. “If they have been rude or discourteous to my assistant, if they give my assistant inconsistent information, these are usually very large flashing neon red flags.”

    Thomas J. WatsonThomas J. Watson, Marquette 2002, is senior vice president and director of communications at Wisconsin Lawyers Mutual Insurance Co., Madison. Contact him at com Tom.Watson wilmic wilmic Tom.Watson com.

    3. If you don’t like your client, then you better love your carrier.

    You will always have your least favorite clients, and they will be the ones you won’t want to deal with. So you won’t. “These are the matters where you will fail to properly communicate, miss deadlines, and make bad choices,” Kunzke says. Unfortunately, all those things may lead to a much higher risk of a malpractice claim.

    “You don’t have to like your client to do their work, but you do have to do the work or pay the claim,” Kunzke says. “So either fire the client, plan to be miserable while you do the work, or put your carrier on notice.”

    4. Conflicts of interest aggravate everyone.

    You can get clients to waive potential conflicts, but Kunzke says jurors generally aren’t impressed with conflict waivers, especially if the lawyer got paid by both sides. In addition, clients may recall waiving a potential conflict, but they inevitably say they didn’t understand what that meant. She says, “If it meant they weren’t going to ‘win,’ they wouldn’t have done it. Life is too short and you’re too busy to spend time and money defending against conflict claims. There is plenty of unconflicted work that needs your full attention.”

    Connolly says, “When I was first in solo practice, it seemed unnecessary because I could name all my clients. But, over the years, the importance of conflict checks increases as you simply forget the little cases here and there that you do.”

    5. Your client already knows how this is going to turn out.

    Someone who “knows everything” and just wants you to carry out his or her wishes rarely, if ever, becomes a good client. This is the client who doesn’t listen attentively and goes into denial when the discussion turns to potential weaknesses in the case. Connolly says it’s a major warning sign if a potential client “informs my assistant that they ‘know the law’ or they were ‘told the law’ by several other lawyers.”

    Kunzke says always ask clients what they expect for an outcome and listen to their answers. When what they say doesn’t make sense, correct their misconceptions. “You need to make sure they understand that ‘winning’ looks a lot like compromising,” she says.

    “Everyone watches TV and knows what lawyers do. Your work is always exciting and very rewarding. Your cases all go to court and your three-minute closing argument brings tears to the judge’s eye and gasps of outrage from opposing counsel. Clients are grateful and shower you with praise, gifts, and bonus payments. Some of them want to date you! Your clients also know how their case is going to turn out. They will be vindicated, completely reimbursed, pain free, debt free, have their dignity restored, and get more money than they’ve asked for. If the lawyer does it ‘right,’ nobody has to compromise. Wouldn’t it be nice if it always worked that way?”

    WisLAP Helps Lawyers Cope

    Lawyers who may need help can contact the State Bar’s Wisconsin Lawyers Assistance Program (WisLAP). This program provides confidential assistance to help Wisconsin lawyers, judges, law students, and their families cope with problems related to the stress of practicing law by maintaining a professionally staffed telephone helpline and a support network of trained volunteers.

    Confidential support is available at (800) 543-2625. The WisLAP Coordinator is Linda Albert, who can be reached at (800) 444-9404, ext. 6172.

    As Connolly points out, “Ultimately, it is important to tell a client that I cannot promise them an outcome. Throughout the litigation, I also inform the client of the risks that are involved.”

    6. Never give bad news to a hungry client.

    When a client first comes to you, their problem is big. Kunzke says, “That is the time to tell them that it will take time and money to fix that problem, and that our legal system requires compromise. As you start to shrink their problem, their need for you shrinks, too – they are less willing to listen.”

    As you learn about new problems along the way, tell your client about them immediately and repeatedly. Kunzke says, “These are excellent moments to test their expectations: Let the client read the bad report from the expert and explain it to you. You will know how much correction the current expectation will require.”

    Most important, Kunzke says, “Say and write the important stuff. And use words they understand, not words only lawyers use.”

    7. You have to let your client make dumb choices.

    Clients will sometimes do the wrong thing, not spend enough money to do the right thing, and occasionally tell you not to worry about the important thing. They have a right to do all these things. Hindsight will often show them they were wrong. Usually hindsight is too late. Therefore, Kunzke says, protect yourself. “Make sure you told them what the right thing was. Say it and write it. Give them enough information to enable them to make the choices that belong to them. Even the dumb ones.”

    8. What your client heard matters more than what you said.

    We all hear what we want to hear. You say, “You might win; it is not likely to cost an unreasonable amount of your money; it will happen as quickly as our system allows; I’m hoping you will be satisfied when it’s over.” Your client heard, “You will win; it won’t cost any of your money; it will happen quickly; you will be happy when it’s over.”

    Kunzke says, “Always put your advice in writing, even if you’re sure the client understood it when you said it. They probably did. But what they remember is what they wanted to hear, not necessarily what you said.”

    9. When they smile and nod, your client is not understanding or agreeing with you.

    We all want uncomfortable situations to pass quickly. Clients are usually uncomfortable in your office because they couldn’t solve their problem on their own, they don’t believe they should have the problem at all, it’s not their fault to begin with, and they don’t like that they are going to pay you to solve it.

    Kunzke says clients often handle these uncomfortable feelings in a very understandable way. “We all know these two rules: questions make everything take longer, and smiling and nodding makes everything go quicker. We all do it, whether we’re in our doctor’s office, facing a police officer who pulled us over, listening to Uncle Walter’s 600th retelling of his rags-to-riches story at Thanksgiving, or enduring the senior partner’s 600th retelling of how much harder it used to be to practice law. We don’t ask questions, and we smile and nod approvingly. Never mistake smiling and nodding as anything other than an indication of a client’s discomfort. Say the important stuff loudly, with ordinary words, and put it in writing!”

    10. They may call it “practice,” but they’re just kidding.

    As Kunzke tells lawyers, “The standard of care is ‘be really good all the time.’ You aren’t really good all the time – nobody is. If you say you’re extra good, in an ad for example, you are holding yourself out as a ‘specialist.’ Then you have to be extraordinarily good all the time. Even if you say you’re an average lawyer (and who does that?), you still have to be really good all the time. If you continue to make yourself available to your client 24 hours a day with your Blackberry or other mobile device, you will raise the standard of care.”

    The bottom line, Kunzke says, is “pay attention to what good lawyers are doing – you have to keep up.”




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