In Michigan, an accountant may be liable to a client in tort and contract. But can an accountant be liable to a non-client in tort or contract? The answer is yes, but the circumstances are few and far between.   Tort Liability To date, Michigan courts haven’t had occasion to weigh in on whether a...

You can’t please every client. That’s all the more true in the criminal-defense setting, where the stakes are high. Your client has the potential to lose the thing we value most—freedom. And who’s the first to blame when your client receives a jail or prison sentence, particularly an unexpected one? You. That blame, often misdirected,...

You may think of a referral fee as a purely contractual issue. But the right to collect a fee is an ethical issue, too. Michigan Rule of Professional Conduct 1.5(e) states that attorneys in different firms can divide a fee only if (1) the client doesn’t object, and (2) the total fee is “reasonable.” The...

“A lawyer’s time and advice are his stock in trade,” Abraham Lincoln once famously said. Unless you agree to handle a matter pro bono, you expect payment for your time and advice. But, like most lawyers, you’ve probably had clients who haven’t made good on their agreement to pay. Should you sue a former client...

In our previous posts, we addressed two topics that affected employers at the height of the COVID-19 pandemic: paid leave and return to school. Recently, as the downward trend in COVID-19 cases continues and the world tries to return to some semblance of normalcy, Michigan’s Governor announced that the State will permit in-person office work—even...

Rule 1.15 and Rule 1.15A of the Michigan Rules of Professional Conduct govern the management of funds belonging to clients and third parties. When clients or third parties entrust you with funds, you’re required to hold the funds in interest-bearing trust accounts. You’re also required to maintain your trust accounts in financial institutions approved by...

In a previous post, we addressed statutory amendments concerning the architectural-malpractice limitation period, which the Legislature enacted in response to a 2006 Supreme Court decision that pegged both the statute of limitation and the statute of repose at six years. The six-year statute of repose lived on, but the Legislature amended MCL 600.5805 to place...

By Melissa E. Graves and Benjamin D. Wu   A request for the file—whether from your client, your client’s agent, or your client’s new lawyer—will probably put you on high alert. Sure, the request could be harmless curiosity. But the request could also be a red flag—a tip-off that a malpractice suit is on the...

An insurance agent is essentially an “order taker.” Under well-established law in Michigan, an insurance agent owes no duty to advise an individual seeking insurance about the adequacy of coverage absent a special relationship, which arises only in limited circumstances (e.g., a special relationship may arise when an insurance agent misrepresents the nature or extent...

An engagement agreement is fundamental to defining the relationship between you and your client. An engagement agreement establishes the scope of your representation, manages your client’s expectations, and ensures that you and your client are on the same page. Carefully defining the scope of the representation in an engagement agreement can also provide you with...

There’s no shortage of decisions addressing the requirement of expert testimony in legal and medical-malpractice cases. But decisions addressing the requirement of expert testimony in accounting-malpractice cases are few and far between, as we noted in a couple previous posts (which can be accessed here and here). CEF attorneys hope to change that and recently...

Divorce litigation, often the product of broken hearts and shattered dreams, is one of the most contentious areas of practice. There’s usually extreme tension between the parties, one of whom will probably feel that the end result is unfair. Not surprisingly, divorce attorneys find themselves as legal-malpractice defendants more than attorneys in any other area...

By: Benjamin D. Wu A professional relationship is the hallmark of a professional-negligence claim. Generally, damages for professional negligence aren’t recoverable in the absence of a professional relationship. This rule is well established in the context of legal malpractice and medical malpractice―a non-client or a non-patient generally doesn’t have grounds to sue for derivative damages...

One of the oldest principles of legal ethics is that confidential communications between attorney and client are privileged. This privilege ensures full and frank communications between attorneys and their clients, without concern over disclosure to third parties. But online communications can complicate the privilege analysis. The Court of Appeals recently addressed one of these complications...

When Congress passed the Families First Coronavirus Response Act (FFCRA) last spring, the major issue facing professional corporations was when to return to work and how to do so safely. As summer has turned to fall, the primary issue now facing many professional corporations is how to address employees who cannot work their normal schedules...

In January 2019, the Michigan Court of Appeals issued Estate of Voutsaras v Bender, a published opinion recognizing a new limit on the witness-immunity doctrine. As explained in our earlier blog post, the Court held, as a matter of first impression, that licensed professionals retained as expert witnesses or consultants aren’t absolutely immune from malpractice...

An interesting debate played out in the concurring statements to a Supreme Court decision issued earlier today. The topic was Scarsella v Pollak, a 20-year-old Supreme Court decision in a medical-malpractice case. The decision issued today didn’t involve a medical-malpractice case, but it established that there are currently at least two votes to overrule Scarsella....

When an insurer hires defense counsel to represent an insured, a “tripartite relationship” is born. In some jurisdictions, courts consider both the insured and the insurer to be clients. In other jurisdictions, courts consider the insured to be the primary client but recognize, nevertheless, that defense counsel also owes some secondary duty to the insurer....

The past three months have created unprecedented challenges for professionals across all sectors of Michigan’s economy. As we begin to explore returning to the workplace, law firms, accounting firms, and other professional service corporations are confronting new issues, such as how to reintegrate our employees into our workplaces safely and in compliance with employment laws...

Michigan Supreme Court orders argument on pair of plaintiff applications concerning malpractice law. Last week, the Michigan Supreme Court signaled that it’s considering a tectonic shift in malpractice law. It granted the plaintiff leave to appeal in one malpractice case and ordered argument on the plaintiff’s application for leave to appeal in another. The issues...

With the world adjusting to the impact of COVID-19, many accountants have already found themselves, or will soon find themselves, hearing from current or past clients who want advice about the impact of COVID-19. Issues related to the CARES Act, the Paycheck Protection Program, or general accounting and tax advice arising out of economic pressures...

Lawyers aren’t immune from the mental-health implications of the COVID-19 crisis. As social distancing has continued, the isolating practice of remote work has become the new normal. So it’s critical that we, as lawyers, are mindful of our well-being and the well-being of our colleagues, family members, and friends. Below are several strategies and resources...

For many of us, working remotely was merely an occasional convenience—a way of catching up on work in the evening or on the weekend without having to step foot in the office. Unfortunately, the current state of affairs has moved our law practices to basement alcoves, dining-room tables, or spare-bedroom desks. This disruption can shake...

On March 30, 2020, Governor Whitmer issued Executive Order 2020-30, which suspends certain scope-of-practice restrictions for a wide range of allied health professionals.  The order lifts restrictions for certain health professionals who are working at their place of employment, are necessary to respond to the COVID-19 crisis, and are performing tasks appropriate to their education, training,...

You just won a major legal battle on behalf of your client. You can’t wait to post about your victory on Facebook, LinkedIn, Twitter, and Instagram. You start typing up a long narrative of your win on your social-media pages. But wait, you think, are there any ethical rules I should consider before posting? Ethical...

The Fair Debt Collection Practices Act contains a one-year statute of limitations, which runs from “the date on which the violation occurs.” While straightforward as written, federal circuits have been split on whether the limitation period could be tolled by the discovery rule. The Sixth Circuit has repeatedly danced around the issue, without ruling one...

In the age of digital-property listings and auto-population features to input data on the Multiple Listing Service (MLS), realtors may view the listing process as nothing more than an administrative function. But realtors need to be careful. Inaccurate information on a property listing can open the door to a costly lawsuit. Michigan cases are replete...

The Fair Debt Collection Practices Act was originally passed to curb abusive and deceptive conduct on the part of debt collectors. But in practice, the FDCPA has become a tool used by enterprising consumer-credit attorneys to collect legal fees for technical violations, even when no actual harm occurred. That’s because the FDCPA mandates statutory damages,...

Happy New Year!  As you contemplate the year ahead and assess your professional goals for 2020, here are seven New Year’s resolutions to consider. Navigate social media with style Engagement agreements should be reviewed and reevaluated Work out your succession plan Your mental and physical health are paramount Educate yourself to maintain technological competency Assess...

You’ve probably seen some technical pitfalls. Maybe a lawyer unwittingly hit the “reply all” button. Or perhaps a lawyer failed to realize that his electronic redaction of privileged communication could be undone by a simple “copy and paste.” Others have noticed, too. In 2012, the American Bar Association amended Model Rule of Professional Conduct 1.1...

Consumers who conclude that they’re underinsured often blame their insurance agents. They file lawsuits in which they blame their insurance agents for failing to advise them to, for example, purchase a policy for their boat or purchase a more comprehensive policy for their car. The central question in these lawsuits concerns the scope of insurance...

Many retainer agreements contain an arbitration clause for the resolution of disputes that arise from the attorney-client relationship. The Michigan State Bar Ethics Committee takes the position that arbitration clauses, in general, are unethical. Michigan courts, on the other hand, find arbitration clauses to be valid, enforceable, and compatible with the public-policy preference for dispute...

Late last year, the Court of Appeals issued a published decision in Broz v Plante & Moran, PLLC, which provided some much-needed clarity regarding the applicable standards for accountant-malpractice claims. (See our post about Broz here.)  But that clarity was short-lived, as the Supreme Court recently issued an order vacating part of the decision. At...

Attorneys routinely use settlement demands as a method to resolve cases without the time commitment and cost associated with protracted litigation. But at a certain point, the language of a settlement demand may cross the line from mere negotiation strategy into illegal extortion. This is particularly true when the settlement demand includes a threat of...

Most lawsuits against attorneys involve tort claims that fall under the legal-malpractice umbrella. Yet clients often allege another tort: breach of fiduciary duty. The Court of Appeals has recognized that a breach-of-fiduciary-duty claim may be separate and distinct from a legal-malpractice claim. But at the same time, the Court of Appeals has also recognized that...

In litigation, there are limited circumstances that require an attorney to withdraw from representation of a client. Barring these circumstances, most of which commonly involve illegal or fraudulent conduct on the part of the client, the attorney may still find herself seeking termination of the attorney-client relationship. With the permission of the court, the attorney...

There are some saints in the legal profession. Attorneys who accept appointments to represent the best interests of a minor in child-protective proceedings are among them. Their work isn’t lucrative, and the stakes are exceptionally high. Collins Einhorn attorneys recently prevailed in an immunity defense of such an attorney―establishing new, controlling precedent in the process....

The Legislature created the Michigan Consumer Protection Act to identify and prevent unfair trade practices in consumer transactions. The Act identifies over 37 types of conduct that are defined as “unfair” and “deceptive” when committed in the course of transactions for personal, family, or household services, among others. MCPA violations have been assessed against a...

Malpractice defendants often find themselves with a lot of company. When a transaction seems to go awry, aggrieved plaintiffs may sue every professional involved—accountants, lawyers, consultants, and their respective firms. With multiple defendants, there’s a possibility that the court will issue multiple orders resolving the plaintiff’s claims. For example, the court might grant summary disposition...

Under Michigan law, the (former) client in a legal-malpractice action must prove that the attorney actually caused her injury. That means the client must prove that she would’ve achieved a better result “but for” the attorney’s alleged malpractice. The concept of but-for causation is most prevalent in the context of litigation, where the attorney’s alleged...

In the seminal case of Simko v Blake, the Michigan Supreme Court defined the parameters of what’s become known as the “attorney-judgment rule” in the legal-malpractice context. The Court held that an attorney isn’t liable for “mere errors in judgment” if the attorney had a good faith, honest belief that his or her acts or...

Previously, under the Sixth Circuit’s decision in Glazer v. Chase Home Financial LLC, Michigan lenders and attorneys who sought non-judicial foreclosures were treated like any other “debt collector” under the FDCPA. This meant that even if the lender or attorney sent an initial communication required by statute, that communication also had to contain the “mini-Miranda”...

Ordinarily, a Michigan attorney who is disciplined in another state or federal jurisdiction will face discipline in Michigan, too. Michigan attorneys also have a duty to report discipline in other state or federal jurisdictions. But what happens when the other jurisdiction imposing discipline is a tribal court—a judicial body of one of America’s sovereign tribes?...

A lawyer’s retention agreement has two general purposes.  It memorializes what the lawyer has advised the client regarding the objectives of the representation, the way those objectives will be pursued, and the anticipated costs.  But it also protects the lawyer against potential malpractice claims.  A carefully-drafted agreement can be a lethal arrow in a lawyer’s...

Suppose you’re an architect hired to design a new condominium development in a township. The township approved your plans, and the development is built and occupied more than three years ago.  Four years go by since you stopped providing services without a whisper of a problem. But then your firm is served with a lawsuit...

Accountants, like other licensed professionals, can be sued for malpractice. But cases involving accounting malpractice are few and far between. Until recently, there’s been scarce guidance from Michigan appellate courts about the applicable standards for accountant-malpractice claims. The Court of Appeals recently issued a published decision in which it provided some much-needed guidance regarding accountant-malpractice...

Fair Debt Collection Practices Act; Attorneys Class-action attorneys often use the Fair Debt Collection Practices Act (FDCPA) as a tool to turn minor, technical violations into substantial settlements. Chief among these tools are omissions of the “Notice of Debt” requirements—statements so ubiquitous that they’ve been nicknamed “Mini-Miranda” notices. Under the FDCPA, a debt collector’s initial...

Attorneys retained to provide expert support or testimony aren’t immune from malpractice claims under the witness-immunity doctrine simply because their services included or intended to include expert testimony. That’s the gist of the Michigan Court of Appeals’ decision in Voutsaras v Bender, one of the first published decisions this year. That legal-malpractice case arose out...

Collins Einhorn Farrell is pleased to announce the launch of Pros for Pros, a professional-liability blog. Our contributors are skilled and seasoned professional-liability attorneys who have built a strong reputation of success and earned the respect of Michigan’s trial and appellate judiciary. Our blog posts contain tips and tools for professionals, pointers on avoidance of...