Malpractice Issues in Business Transactions

/ 09.Jul, 2012
CNA recently released the results of a study of approximately one thousand closed legal malpractice cases arising out of business transactions.  Highlights of the study include:
The leading cause of business transactions claims – the improper preparation, filing and/or transmittal of documents – accounts for more than one-third of claim volume. Failure to provide appropriate legal advice, the second leading cause, represents approximately one-fourth of these claims. The cost to defend a business transaction claim is more than twice the cost of claims resulting from other areas of practice. Attorneys who dedicate more than 25 percent of their practice to business transactions are less likely to have a claim asserted against them. However, those claim losses are on average significantly more expensive than those brought against attorneys who only dedicate 5 percent or less of their practice to this area of law.
The study includes a very nice section on managing the risks in business transactions.  Most of the types are standard practice for malpractice avoidance.  Worthwhile reading for anyone who practices regularly in the area of business transactions, and even more so for those who practice irregularly in the area. -Josh J.T. Byrne, Esquire