Yesterday’s Post

Believe it or not yesterday’s post brought in more comments than any other post in a 24-hour period.  I have published some of the comments; other comments seemed to address personal situations so I thought it best to pass on those.

Let me respond to several  of the comments.  Bill said "a judgment that is seemingly noncollectible today may be collectible tomorrow. Have you given any thought to this argument? In other words, what kind of proof should a victim of malpractice be required to produce?" 

First, the plaintiff should have to prove the amount of liability insurance, if any, available to the original defendant.  Second, if the plaintiff wants to collect a judgment more than the amount of the liability insurance originally available, he or she should have to prove that it was more likely than not that the plaintiff could have collected more than that amount from the tortfeasor.  This will require proof of the income, assets and liabilities of the original defendant.  In appropriate cases, the lawyer defendant will want to demonstrate that the income, etc of the original defendant is such that the plaintiff cannot prove that the judgment would not have been collectible.

At the end of the day the jury will decide whether it is more likely than not whether any judgment over and above the amount of the liability insurance available to the original defendant would have been collectible or not.  Each of one us settles cases every week (maybe every day, if we are fortunate) for the available policy limits because we understand the difficulties in collecting judgments in excess of that amount.  That does not mean that the plaintiff  in a legal malpractice case should be limited to collecting from the lawyer defendant only the amount of the original defendant’s liability insurance, but we all know that in high percentage of cases that is all of the monies that are available and most plaintiffs will accept a "policy limits" settlement upon reasonable proof that no other monies are readily available.

For instance, take a PI case that 10 reasonable lawyers would agree is worth $50,000.  The defendant in the case has only $10,000 in liability coverage.  The defendant has a minimum wage job and lives in an apartment.  Virtually every plaintiff’s lawyer, and virtually every plaintiff. would settle that case for $10,000.  There is no reason to force the defendant into bankruptcy or otherwise attempt to collect the balance of the value of the case.

Should that case be worth any more if the plaintiff’s lawyer blows a statute and the plaintiff cannot sue the original defendant?  I don’t think so.  The plaintiff should be in the position he or she should have been in but for the malpractice.  And that is a judgment against the plaintiff’s lawyer for $10,000.

Next, take the same case and assume that the defendant owns a home with little equity in it, makes $25,000 per year, and has car payments and credit card debt.  Once again, virtually all plaintiff’s lawyers and virtually all plaintiffs settle that case for $10,000.  Should the value of that case be increased because the "new" defendant is a lawyer?

Now, assume the same case and assume that the defendant owns his own home, has an 80% mortgage against it, and makes $100,000 per year.  In that case, most plaintiff’s lawyers and most plaintiffs would not compromise a $50,000 case for $10,000 in coverage.  In such a case, either an excess judgment is obtained, a settlement is reached with the original defendant picking up some portion of the excess, etc.  If the plaintiff’s lawyer blows a statute under those facts, the jury should decide the collectibility of the excess judgment, and the burden should be on the plaintiff to prove it.  Will the jury be able to determine to a moral certainty whether the original judgment would have been fully collectible?  No.  Juries are not called upon to do so.  Juries determine facts under a "more likely than not" standard and apply those facts to the law.  They will do the best they can given the facts they are presented and the arguments of able counsel.  But, in my opinion, the burden of collectibility must be on the plaintiff because, as I explained in my earlier post, in my opinion it is part of the causation requirement ("my lawyer’s malpractice more likely than not caused me this financial loss").

True, a judgment that may not be collectible today may be collectible tomorrow.  The original defendant may win the lottery.  Or may win a bet that Vanderbilt will win the NCAA football championship.  Anything could happen (well, maybe not Vanderbilt winning the NCAA, but you get my point).  But what is likely to happen?  What is likely to happen is what happens every day – and that is that "excess" cases are settled for policy limits (sometimes less!) to avoid the cost and emotional turmoil of litigation.  And while a plaintiff should be permitted to argue to the jury that he or she would not have accepted a settlement of "policy limits" from the original tortfeasor and would have gone to trial and obtained a judgment, he or she should also have to convince a jury that the "excess judgment" was something other than a piece of paper.

James said "what about the client’s inconvenience, attorneys’ fees, loss of use of the money, etc. It is the price we attorneys must pay for screwing up…a penalty for abusing our clients’ trust. "  Sorry, James, but I disagree.  No other defendant has to pay damages for a litigant’s inconvenience, fees, loss of use of money, etc.  Why should a lawyer defendant? 

Believe me, I have absolutely no problem with holding lawyers accountable for their negligence.  My point is that the standard of liability, causation, and damages should be the same as it is for everyone else.  No better, no worse. 

"It is the price we attorneys must pay for screwing up…a penalty for abusing our clients’ trust."  James, that position does not make any sense to me.  Blowing a statute is not a breach a trust, it is an error.  It is an error that is extremely difficult to defend, and indeed most attorneys readily admit legal responsibility for it, but it is not a "breach of trust."  No other defendant pays "a penalty" for making a simple error.  Instead, they are held liable for the damages they cause.  Why should lawyer defendants be held to a different standard?

True, if a lawyer commits acts that are reckless, intentional, etc. that would give rise to a claim for punitive damages the plaintiff should be able to seek them.  But the vast majority of legal malpractice claims, like the vast majority of other negligence actions, are simple acts of negligence.  And in such cases the only "penalty" should be the accountability for compensatory damages. 

Perhaps what James is arguing that lawyers should accept a higher level of financial responsibility of harm than any other defendant.  I disagree.  Lawyers already do a better job than many professionals of accepting responsibility for their errors.  I have seen hundreds – hundreds – of letters from lawyers to clients admitting that they have made a mistake and encouraging their client to seek the advice of a lawyer.  (Indeed, in Tennessee, lawyers opposed a statute of repose that would have limited their responsibility for harm.  Can you imagine a doctor doing that?)  But, at the end of the day, lawyers should be subjected to the same standard as anyone else if they find themselves on the wrong end of the "v" in a malpractice suit.

Thanks for your comments.