How the right software and management processes can help you avoid clerical errors and keep malpractice problems at bay
A review of the 9,221 LAWPRO-listed claims made between 1999 and 2004, covering all practice areas, shows that only 10% of these claims involved a failure to know or apply the law. The other 90% were the result of sloppy matter, deadline, and document management. While problems can happen anywhere, the results are particularly egregious in three areas: trust accounting, court rules, and document generation.
Avoiding trouble with trust accounting
Mismanagement of trust funds is one of the leading reasons lawyers get disbarred. Many attorneys get into trouble quickly by using generic business-accounting software to track trust funds. Although easy to get and often free, generic accounting software is not designed to accommodate legal-specific requirements, such as local regulations, that you need to protect yourself. While you can customize generic software-usually with the help of an outside consultant-it's a time-consuming process that will leave you short of critical features, like alerts that let you know when you're in danger of non-compliance.
A best practice is to choose legal-specific accounting software that is designed to deal with complex trust accounting issues. Find a system that cleanly separates your general operating accounts from your clients' trust accounts. Look for features that show you where the money went, matter by matter, and will keep you apprised of funding levels.
As an extra safeguard, build accountability into your client communications. If you issue billings on a regular basis and a client has a trust account with you, consider including a statement of trust with your invoice. This statement can just be a simple transaction list of all trust activity since the last bill to be sure that everyone has the same view.
Adhering to court rules
Basic calendaring issues are another high risk area for attorneys-one that can lead to costly claims.
According to LawPRO, calendaring errors fall into four categories:
- Failure to know or ascertain a deadline correctly (not knowing a limitation or notice period, filing deadline)
- Failure to calendar properly (knowing the deadline, but was not set in a calendar or tickler system)
- Failure to react to a calendar item (placing the deadline in a calendar or tickler system, but was missing it)
- Procrastination in performance of services or lack of follow-up
Here too, the solution is practice management software that automatically help you keep an up-to-date calendar, manage your time and priorities, and systematically check for conflicts. The right system will not only helps you avoid a malpractice claim, but can also have a positive impact on your bottom line by helping you understand how you spend your time and where you can make adjustments to be more productive.
Generating airtight documents
Good listening and good information are the foundation for good documents-in other words, documents that won't get you sued. Inadequate discovery of facts and other investigation errors usually stem from a failure to dig a bit deeper and recognize issues or requests that are relevant to the matter you are working on. As a best practice, use document creation tools that systematically guide you through the process. With these tools, one question leads to another to automatically ensure that all critical areas are covered and that you get the right information.
Some attorneys are tempted to repurpose an existing will or deed by simply swapping out names and other pertinent details for the new client's case. This is not a good idea. Some of the finest details, such as not changing "he" to "she" can turn out to be important down the road and potentially costly.
Recently, a telco giant found itself involved in a case where it could have lost significant money due to a misplaced comma that created ambiguity in a contract. The company was ultimately able to ward off damages, but it was an expensive, timeconsuming battle. The moral of this story is to be diligent in how you create documents and ruthless in your reviews. The best way to steer your firm clear of treacherous waters is to insist on legal-specific software that will help you track and maintain critical information. With the right tools to automate your processes, you'll be able to work faster without cutting corners.
Many firms face the challenge to accurately and efficiently manage physical items and records associated with client files, such as wills, deeds, bonds, and other related documents.Sophisticated systems used by large law firms are typically expensive or require specialized knowledge to set up and run. Therefore, smaller firms rely on manual tracking or stand-alone electronic spreadsheet applications-neither of which links client information nor integrates with other practice management technologies. These practices are inefficient and elevate the risk of errors, lost physical files, and missed connections between items, files and cases.
LexisNexis developed the new PCLaw® Safe Custody and Physical Closed File management system-based on feedback from private practice lawyers-to address this situation. It offers law firms the ability to electronically track, manage, and associate physical items and records with their clients' active and closed files and ensures more cost-efficient records management while minimizing errors and mismanagement of client files. These processes are integrated with other aspects of a firm's practice management functions for a smoother and more consistent workflow.