 |
 |
|
|
|
|
Tripartite Relationship A successful defense of a legal malpractice suit often can be affected significantly by how well the insured, the defense attorney and the insurer's claim counsel work together. Ideally, the three parties in this so-called "tripartite relationship" should act in partnership to pursue a resolution of the claim in a mutually agreed upon way. However, the relationship may not approach that ideal for a variety of reasons arising from the varying concerns, interests and perspectives that each party has. Being sued for malpractice obviously can be a traumatic experience. The plaintiff is not simply making a claim for money; he is challenging the lawyer's professional competence. This attack, quite naturally, often produces emotional responses, ranging the gamut from outrage to anxiety to resignation to guilt. Whatever emotion is evoked is seldom mollified when the defendant lawyer discovers that he will be represented by another attorney who he has not chosen and whom he might never even have known. These emotions, as well as the insured's personality and style, can, in turn, strongly influence how the lawyer wants the defense to be handled. It will come as no surprise that some attorneys want to micromanage and control all aspects of the defense. Others just want the case to go away and want no involvement in accomplishing the result. Fortunately, the vast majority of attorneys are reasonable, appreciate that they are being represented by other professionals and cooperate in defending the claim. Besides wanting to approach the defense of a claim in different ways, different attorneys who have been sued might have different goals in resolving the claim. In some cases, the goal might be a fast settlement of the claim, period. In others, the attorney's goal might be vindictation through complete litigation of the claim. The insurer, by contrast, typically has a fairly straightforward and consistent goal: namely to resolve the claim properly in a cost efficient manner. This goal, as simple as it sounds, frequently has the potential to create conflict with the insured. For example, an insured might want a claim settled as quickly as possible no matter what the cost, while the insurer, based on its assessment of the exposure, might not be willing to accede to the plaintiff's initial settlement demands. At the other extreme, the insurer might desire to reach a settlement to which the insured does not want to consent. As another example, based on the insured's right typically to control the defense of the case, the insurer might not be willing to pay for every motion, deposition and expert that the insured might desire. Additional conflicts can arise when there are coverage issues or when the potential exposure on the claim exceeds the policy limits. The Role of Defense Councel The third party involved in the tripartitie relationship is, of course, defense counsel. It is absolutely clear that defense counsel's client is the insured. This truism, however, by no means satisfies all the practical difficulties encountered in maintaining the appropriate relationship with both the insured and the insurer. Coverage questions, at least in principle, are perhaps easiest to handle. Defense counsel may not offer coverage advice to the insurer and must not provide information to the insurer which would adversely affect the coverage. Counsel, on the other hand, likewise should not offer coverage advice to the insured. The defense of the case, however, frequently puts counsel between the sometimes conflicting interests and desires of the insurer and insured in other ways. For example, the insured might insist that a spare-no-expenses defense be mounted at the same time that the insurer is equally adamant that an effective and appropriate defense can be pursued at less cost. Defense counsel must attempt to give objective advice concerning what is necessary and appropriate. Likewise, defense counsel is called upon to give an objective assessment of exposure and the reasonableness of a potential settlement even though such advice might not please either or both the insurer and the insured. Obviously, conflicts between the insurer and insured put defense counsel in an extremely uncomfortable position. Clearly, counsel's paramount duty is to the insured, not the insurer. However, defense counsel does have obligations to report to the insurer and provide assessments of the case. Furthermore, defense counsel typically will have had a much longer relationship with the insurer's claim counsel than with his client, the insured. And, of course, there is no secret as to who is paying the counsel's bills. What defense counsel clearly must not do is to take sides -- or appear to take sides -- in any dispute between the insured and the insurer. There is no single, easy answer to the stresses and frictions that might arise among the three partners in the defense of a legal malpractice action. Hopefully, however, the three parties will be cognizant of the concerns and positions of the others. More importantly, as is true concerning virtually all human relationships, the key to success of the tripartite relationship in defending a legal malpractive action is communication. Both the insurer and the insured ought to feel that they are equally informed and involved in the conduct of the defense. Similarly, defense counsel should be informed promptly and continuously of the insured's and insurer's positions and wishes concerning the case and of any concerns or issues concerning defense. If communications fail, and one or more of the three prongs of the tripartite relationship becomes adversarial, then the only party who will clearly benefit is the plantiff. |
|
|
|
|
 |
© 1998-2007 Legal Mutual Liability Insurance Society of Maryland. All Rights Reserved. |
|