Legal Malpractice Insurance and Oregon’s Professional Liability Fund
Oregon attorneys must have legal malpractice insurance to protect their clients. The minimum coverage is $300,000 through the Professional Liability Fund (PLF). Some firms have additional, or “excess” insurance. This post discusses what claims are covered, what claims are not covered, and why you should care.
Why should clients care about what claims are insured?
Some of Oregon’s most infamous attorneys were broke when everything fell apart and hurt their clients. They “robbed Peter to pay Paul.” Then, when Peter sues for his money, it is gone. Under this scenario, if the claim is not insured, then, even though it is a valid claim – such as fraud or theft – it might not make sense to sue because the client might never collect the judgment.
What Claims against Oregon Attorneys are Insured?
PLF legal malpractice insurance covers errors, omissions, negligence or other breaches of duty made while providing legal services that are not intentional.
PLF covers lawyers working as lawyers. It does not cover attorneys working as board members, lobbyists, real estate agents, business partners, etc. It does not cover bad investment advice or business transactions where the attorney is a party to the transaction. When employees of a law firm sue the firm for employment discrimination, that is not covered by legal malpractice insurance. (However, some employers have other insurance to cover employment claims.)
What Claims against Oregon Attorneys are Not Insured?
PLF legal malpractice insurance does not cover conduct that amounts to fraud, a crime, dishonesty, theft or conversion, a knowing violation of rules of professional conduct or other intentional wrongs.
What Monetary Damages are Insured and Not Insured?
Civil lawsuits award money. Monetary damages come in several categories, not all of which are paid by PLF legal malpractice insurance. PLF covers compensatory damages to pay back clients for their actual losses. Also, the PLF may, if it wants to, hire a separate lawyer to try to fix the problem created by the attorney who screwed up. We call this a “repair attorney.”
PLF does not pay for punitive damages or fines UNLESS, the client had to pay money because of the negligence of the attorney.
Although clients may sue to recover attorney fees they paid to the negligent attorney, PLF malpractice insurance does not cover that. An example would be where an attorney recommends a lawsuit that is dumb and then bills the client for all the work on a dumb claim. Although the client may sue to get the money back, it must come out of the pocket of the attorney, not the insurer.
When considering claims against an attorney, the client should consider carefully which claims are available and choose wisely.
Merrick Law helps people evaluate claims against lawyers and sue attorneys when they won’t settle a meritorious claim. Use this contact form for request a call back.
Merrick Law, LLC.
© 2018 by Jeff Merrick
The above is not intended as legal advice. It is for general information purposes only. Reading it or attempting to contact me does not mean I am your attorney. I only represent people after we sign a written contract.