Attorney, Medical, Accountant & Financial Advisor Negligence Claims
To establish professional malpractice, claimant must prove:
| Profession | Standard of Care | Authority |
|---|---|---|
| Attorneys | Knowledge and skill ordinarily possessed by members of legal profession under similar circumstances | Common law; Rules of Professional Conduct |
| Physicians | Knowledge, skill, and care ordinarily possessed and exercised by members of medical profession under similar circumstances (locality rule abolished in CA) | Civ. Code § 3333.1; CACI jury instructions |
| Accountants/CPAs | GAAP (Generally Accepted Accounting Principles) and GAAS (Generally Accepted Auditing Standards); care and skill ordinarily exercised by accountants | Professional standards; state licensing laws |
| Financial Advisors | Suitability standard (broker-dealers) or fiduciary duty (RIAs); duty to recommend suitable investments based on client profile | FINRA rules; Investment Advisers Act; state securities laws |
| Profession (California) | Statute of Limitations | Authority |
|---|---|---|
| Attorney malpractice | 1 year from discovery, max 4 years from wrongful act (tolled during continuous representation) | CCP § 340.6 |
| Medical malpractice | 1 year from discovery or 3 years from injury, whichever occurs first | CCP § 340.5 |
| Accountant negligence | 2 years from discovery, max 4 years from wrongful act | CCP § 339(1) (professional negligence) |
| Investment advisor | Varies; FINRA arbitration has 6-year eligibility rule from occurrence | FINRA Rule 12206 |
Important distinction:
In addition to civil malpractice claims, clients/patients may file complaints with:
These are separate proceedings with different standards (protection of public vs. compensation for harm), but often run parallel to civil claims.
| Type | Example | Causation Analysis |
|---|---|---|
| Statute of limitations blown | Failed to file lawsuit before SOL expired | Underlying claim would have succeeded (prove "case within case") |
| Conflict of interest | Represented both sides of transaction without informed consent | Show harm from conflict (unfavorable terms, breach of confidentiality) |
| Abandonment / failure to communicate | Stopped responding, missed court dates, failed to inform of settlement offers | Missed settlement opportunity, default judgment, dismissal |
| Inadequate investigation | Failed to discover key evidence, didn't interview witnesses | Evidence would have changed outcome |
| Failure to know basic law | Missed obvious legal argument, wrong choice of law, misadvised on core issue | Correct advice would have led to different result |
Key components:
Attorneys settle when:
Attorneys defend when:
MICRA (Medical Injury Compensation Reform Act):
Purpose: Give healthcare providers opportunity to evaluate claim and potentially settle pre-litigation.
What to include:
| Type | Example |
|---|---|
| Surgical errors | Wrong-site surgery, retained foreign object, anesthesia errors, nerve damage |
| Diagnostic errors | Failure to diagnose cancer, misread imaging, failure to order appropriate tests |
| Medication errors | Wrong medication, wrong dosage, drug interactions, allergic reactions |
| Birth injuries | Failure to perform timely C-section, improper use of forceps, failure to monitor fetal distress |
| Lack of informed consent | Failed to disclose material risks of procedure; patient would not have consented if informed |
Two separate documents:
Many attorneys combine these into single document serving both functions.
Medical malpractice insurers settle when:
Insurers defend when:
Duty sources:
Common breaches:
Damages:
Regulatory framework:
Common claims:
| Claim Type | Description |
|---|---|
| Unsuitability | Recommended investments inappropriate for client's age, risk tolerance, investment objectives, financial situation |
| Breach of fiduciary duty | Acted in own interest (excessive commissions, proprietary products) rather than client's best interest |
| Misrepresentation / omission | Lied about investment risks, failed to disclose material facts, inflated performance |
| Churning | Excessive trading to generate commissions; not in client's interest |
| Unauthorized trading | Executed trades without client authorization or exceeded discretionary authority |
| Concentration / over-concentration | Too much of portfolio in single stock, sector, or asset class (lack of diversification) |
Most customer agreements require arbitration:
Pre-arbitration demand should:
Evidence checklist:
Upon receiving demand letter:
Professional liability policies typically cover:
Common exclusions:
Notice requirements:
Questions to ask (with defense counsel):
| Settle When | Defend When |
|---|---|
| Clear error (missed deadline, obvious mistake) | Judgment call within reasonable bounds |
| High damages, sympathetic claimant | Weak causation (can't prove harm from alleged error) |
| Defense costs exceed settlement value | Frivolous claim, client misconduct significant |
| Risk of excess verdict above policy limits | Strong defenses, claim likely to fail |
| Carrier recommends settlement | Policy limits adequate, willing to risk trial |
Expect parallel board complaint:
Board defense strategy:
If carrier authorizes response before assigning counsel:
Sample brief response:
Use malpractice claim as learning opportunity:
Professional malpractice occurs when licensed professionals—attorneys, doctors, accountants, architects, engineers, financial advisors, and others—fail to meet the standard of care required in their profession, causing harm to their clients. Unlike ordinary negligence, professional malpractice claims require expert testimony to establish what a reasonably competent professional would have done and how the defendant's conduct fell short. These claims typically involve errors of judgment, missed deadlines, conflicts of interest, inadequate investigation, or failure to communicate material information. Understanding the elements and procedures for professional malpractice claims helps victims recover appropriate compensation.
Professional malpractice claims require proving four elements: (1) duty—the professional had a professional relationship with you creating a duty of care; (2) breach—the professional's conduct fell below the standard of care applicable to their profession; (3) causation—the breach directly caused your harm (this is often the most contested element); and (4) damages—you suffered actual, measurable harm as a result. For most professions, expert testimony from another practitioner in the same field is required to establish the standard of care and how it was breached. Some claims also require proving "collectability"—that absent the professional's negligence, you would have actually collected from the opposing party.
Before filing a professional malpractice lawsuit, send a detailed demand letter documenting the professional's errors, calculating damages, and requesting compensation. Most licensed professionals carry errors and omissions (E&O) or professional liability insurance, so the demand typically triggers an insurance claim and settlement negotiations. Consider also filing a complaint with the relevant licensing board—while board discipline doesn't provide compensation, it creates significant pressure to settle. Be aware of shorter statutes of limitations for professional malpractice claims (often 1-2 years from discovery of the negligence). Consult a malpractice attorney early to preserve your rights.