Conflicts of interest leading cause of legal malpractice claims

Recruiting and hiring new talent is a goal for many law firms in the Jacksonville area. Bringing in new people can lead to more productivity, more hours billed and new clients. However, this can also lead to serious and expensive problems if partners and hiring professionals are not careful.

A new survey of legal malpractice carriers has revealed that conflicts of interest are the leading cause of malpractice claims, according to the American Lawyer. Conflicts of interest often arise when new attorneys are brought on board, particularly at the partner level. Failure to closely discuss client lists and past adversarial relationships can spell big trouble.

Risk & Insurance also points out that digging deep may be required in order to uncover such conflicts. For example, if an attorney represented a company at his or her old firm and the new firm represents one of that company’s competitors, a conflict may exist. In addition, the structure of many companies is such that parent corporations and subsidiaries may make identifying potential conflicts difficult.

Law firms can help protect themselves by having clients sign a conflict of interest waiver when a conflict, or even the appearance of one, may exist. Including detailed information about the breadth of the firm’s representation in retainer letters may also be helpful. While the overall number of malpractice claims is down, the payouts from such claims are getting larger. Therefore, it may better to turn down work if a conflict exists rather than risk a huge malpractice payout as a result.

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