Saturday, December 15, 2007

I got no insurance!, Run away, Flee!

Okay, here's my disclosure. I am a government attorney, a prosecutor, and I do not have malpractice insurance. Take your business elsewhere.

(Just kidding, Boss)

Calif. Bar Panel Amends Proposal on Malpractice Insurance

Attempting to mollify critics, a California Bar committee on Thursday recommended a significant change to a proposal that would require attorneys to tell clients if they don't carry malpractice insurance.

But one member opposed to disclosure insisted that the whole idea should be canned before the State Bar rouses the anger of California's considerable ranks of solo practitioners and small-firm lawyers.

"They know this is going to do very little but adversely affect them," State Bar Governor John Dutton said.

Meeting in Los Angeles, the Committee on Regulation, Admissions and Discipline voted 4-3 to require disclosure in writing only when it's "reasonably foreseeable" that a lawyer will represent a client for more than four hours.

The amendment was an attempt to pacify several State Bar governors who expressed concerns in November that the original proposal could force attorneys to disclose a lack of insurance during casual talks at parties or friendly phone calls for advice.
State Bar President Jeffrey Bleich, who attended Thursday's meeting by telephone, liked the amendment and said he hopes it appeases the critics.

"This has just been a politically thorny issue," he said, "and this compromise will hopefully satisfy everyone enough so we can move forward."

The committee's vote sends the recommendation to the Board of Governors for review. If approved, the amendment would be circulated for 90 days of public comment.

The proposal for mandatory disclosure of lack of insurance has been touchy ever since it was introduced during a meeting in mid-2006. It is intended to give the public some idea whether they have financial recourse if their attorney commits an act of negligence -- such as missing a crucial filing date -- that ruins their case.

Once word got out, however, lawyers from around the state objected for fear disclosure would encourage malpractice suits, brand them as less professional than attorneys with insurance and drive up their business costs.

In the last three months, it also became obvious that the State Bar governors themselves were split on the idea.

Dutton, a lawyer from Auburn, Calif., who represents 19 mostly rural counties in Northern California, spoke for the dissenters on Thursday when he said forcing mandatory disclosure on the state's lawyers will "do serious damage" to the agency's reputation. He estimated that 25,000 to 30,000 solos and small-firm lawyers are "angry and hostile" to the idea, and will get their revenge by opposing increases in annual dues and refusing to volunteer money or time toward State Bar causes.

Dutton argued that some county bar associations, a few State Bar committees and most of the members of the Conference of Delegates of California Bar Associations have joined critics in opposing disclosure.
"And here we are," he said, "saying, 'We're going to jam it down your throat. We don't care what you think.'"

State Bar President Bleich, a partner in Munger, Tolles & Olson's San Francisco office, countered by saying the State Bar shouldn't base policies "upon what will or won't be popular. ... Ultimately, our responsibility is to do the right thing."

"What we're looking for," he added, "is to try to ensure public protection and balance the importance of disclosure to clients [with] the legitimate interests of lawyers so they aren't singled out or embarrassed simply because they have chosen not to carry insurance."

Committee members on Thursday also recommended that the State Bar study ways to make malpractice insurance more affordable and available, and consider additional means by which clients could be compensated for negligent acts. They also recommended that State Bar staff assess the impact of disclosure down the road.

In addition, the committee recommended that disclosure not apply to government lawyers or in-house counsel, except when they do outside work for others.