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Posts Tagged ‘“No lawyer love in Nevada”’

Last week Nevada’s Supreme Court spared the state’s private practice lawyers from being forced to pay thousands of dollars in annual costs. The court unanimously denied an ill-considered state bar-sponsored rule petition to impose as a condition of licensure a requirement that all lawyers engaged in private practice buy professional liability insurance. The court ruled, “Having considered the petition and the comments from the State Bar and the public, we conclude that the Board of Governors has provided inadequate detail and support demonstrating that the proposed amendment to SCR 79 is appropriate.”

The Court also took particular note of its existing rule that already provides for public disclosure of whether an attorney maintains professional liability insurance.

Interestingly, in preparing its misguided rule change petition Nevada’s Board of Governors relied on data and input provided by an interested stakeholder and current market participant,“its endorsed lawyers’ malpractice insurance company and “the nation’s largest direct writer of lawyers” malpractice insurance.”

The high cost to practice.

As it is, most lawyers voluntarily carry legal malpractice insurance. But it’s one thing to do so by choice and quite another to do so by coercion. Nevada’s high court is to be saluted for its prudence in rejecting the Bar’s proposal, which would have catapulted Nevada into the uppermost ranks of the highest cost to practice jurisdictions in the U.S.

At least, for now, Oregon has the dubious distinction of remaining king of the high cost mountain.

But high cost contenders remain. Mandatory bar association leaders apparently love nothing more than finding new ways to scorch their members with new practice pains and greater financial burdens, especially for those in private practice. Indeed, as of the first of the this year, to keep their tickets to practice Idaho private practice lawyers are now required to submit “proof of current professional liability insurance coverage at the minimum limit of $100,000 per occurrence/$300,000 annual aggregate.”

That resolution passed in Idaho by a scant 51% to 49% vote of bar members. It’s unclear how many Idaho private practice lawyers voted or were even aware of the proposal. I suspect not many. Moreover, had the word gotten out in time as it barely did in Nevada, the outcome might have been much different.

Anecdotally, for example, in July I exchanged emails with a Nevada lawyer also licensed in Idaho. While objecting to the proposed Nevada insurance mandate, he expressed concern should Idaho follow with a similar requirement. He was floored to learn that not only had it already been considered in Idaho — but that even now he was subject to the new rule as of January 1, 2018!

No remedy.

Besides significantly increasing the cost to practice, mandatory professional liability insurance is no remedy for the victims of a lawyer’s intentional acts or omissions and criminal or fraudulent conduct. Why? Because these acts along with numerous others fall under common policy exclusions that too often foreclose relief to claimants. Insurers don’t cover intentional, criminal or fraudulent acts. In addition, mandatory insurance is not designed to protect the public — but to protect the insured. I discussed some of this in my “No lawyer love in Nevada” July blog post.

Finally, Washington lawyers in private practice should remain vigilant lest they be caught unaware like their next door neighbors. Mandatory bars are notorious copy cats. And the folks running the Washington Bar are particularly adept at giving it to their members.

File:Aprilmaze.jpg

For sometime now and as reported here, the Washington Bar has been considering its own legal malpractice insurance mandate. In July, the Association’s Mandatory Malpractice Insurance Task Force issued its interim report.

I doubt Nevada’s failure to afflict its lawyers with compulsory insurance will do much to dissuade the Washington Bar from its hard-nosed agenda.

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Credits: Aprilmaze.jpg, at Wikimedia Commons, public domain.

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