Are there practice areas where legal malpractice is more common?

Are there some areas of practice where legal malpractice claims are more likely? Yes, according to an annual survey of attorney malpractice claims by the insurance broker Ames & Gough. The survey indicates that a lawyer's participation in certain complex or expanding practice areas is one indicator of whether that lawyer will be sued for malpractice.

Overall, conflicts of interest and perceived conflicts of interest made up the largest share of legal malpractice cases. Indeed, conflict of interest has been the first or second leading cause of such claims in every year this survey has been conducted. Conflicts of interest are taken very seriously by clients, bar associations and courts because they represent a breach of the attorney's duty of loyalty toward clients.

Which practice areas garner the largest number of malpractice claims?

According to the survey, attorneys practicing in four areas generate the most legal malpractice claims: business transactions, corporate securities, commercial real estate, and trusts and estates.

A growing economy has resulted in a large volume of work in both general business transactions and corporate securities. The increased workload has contributed to malpractice claims.

"Whether a company is in the process of formation, protecting its intellectual property, raising capital, going public or private, or embarking on a cross-border acquisition, its outside counsel must have the experience and know-how to guide the company through these complex and high-stakes challenges," said a spokesperson for Ames & Gough.

Typical issues include scrivener errors (clerical errors in the preparation of documents), conflicts of interest, breach of fiduciary duty and inadequate representation.

The volume of commercial real estate transactions is also on the rise, and increasing workloads can again contribute to problems. Common issues include conflicts of interest, errors in document preparation, language in leases and loan guarantees that fails to properly protect client interests, and improper management or maintenance of escrow funds.

The U.S. is entering a period that will involve the largest generational transfer of wealth in history, which may be why trusts and estates is an area that attracts a large number of legal malpractice claims. Again, a swiftly growing workload may be related to the growth in claims. Moreover, not only is this area complex but it also involves sensitive and personal issues, which increases the potential for client dissatisfaction.

To limit the chance of malpractice issues, clients in these practice areas should seek out counsel with the experience, tools and available time to do the matter justice. Attorneys should perform thorough initial and ongoing conflict checks, be clear about who is and who is not being represented, and double-check all documentation for accuracy.

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