Transferred file – or hand grenade?

The title ‘transferred file or hand grenade?’ is borrowed from a commentary on risk management issues from another jurisdiction. Risk management commentaries from other parts of the world identify the transfer of work in progress from one fee earner to another in the same firm as a specific area of risk for lawyers.

The transfer of a live file creates the opportunity for a breakdown in communication, a misunderstanding, an incorrect assumption on the part of one or other or both of the fee earners resulting in something going unchecked or left unattended to, a question not asked, a document left incomplete or unrecorded.

Transferring files

When taking over responsibility for a piece of work in progress, particular care needs to be taken to avoid the temptation to make assumptions about the file which may prove to be incorrect.

You might assume, for instance, that the information about the client and the client’s instructions in the file are correct in every respect; that everything you would have done at a particular stage of a piece of work will have been done; that critical dates have been properly ascertained and diaried.  That may not be the case.

The circumstances in which you are taking over responsibility for the file may be such that it is dangerous to assume that matters will have been dealt with properly.  The colleague may have left the firm for another job, may have moved departments or retired.

In all of these circumstances, there could be reasons why matters have not been attended to as well as they might prior to your taking over the file.  The colleague’s mind may have been on other matters for some time prior to leaving/handing over the file.  The colleague may have been under pressure to finalise as much work as possible prior to leaving and that pressure may not have been conducive to attention to detail.

Perhaps the colleague has gone off ill, in which case his work may have been suffering from a lack of concentration in the days before taking sick leave. The colleague may have been anxious about a more serious medical condition.

Perhaps you have been passed the file as someone experienced in a specialist area of work by a colleague who recognised that the work was outwith his or her experience.  Depending on the stage at which the file was passed on, a certain amount of work may have been done already.

In all of these circumstances more than a cursory file review is appropriate. The file needs to be read thoroughly to ensure that everything done to date is correct; that nothing has been omitted and that none of the crucial facts has been misunderstood or mis-recorded.

If it is practicable, review the file while the colleague who has been dealing with it is still in the office and available to discuss and clarify any areas of doubt.

Whatever the circumstances in which someone is handing over the conduct of a piece of work, that fee earner should be encouraged, with the reassurance that there will be no recriminations over honest mistakes, to identify any problem of which the fee earner is aware.  The same goes for someone leaving the firm. They should be encouraged to make a disclosure about any file which they consider could present a potential problem. That is in everyone’s best interest.

Remember to tell the client whenever there has been a change of responsible fee earner. If this is a case where you have been passed the file to deal with a specialist matter, make sure you agree with your colleague who is communicating with the client and who is keeping track of time limits and deadlines.

Example:

A partner was retiring on account of ill health and his varied workload was transferred to the remaining partners according to their particular area of expertise.  The litigation partner took over the small number of files involving contentious matters, one of them being a personal injuries claim for a client who had been involved in a road accident.  The retiring partner had produced what appeared to be a comprehensive handover note and this indicated that the claim would become time barred on a date which was about a year and a month hence.

The other files called for more immediate action and they received priority attention.  When, a month or so later, this particular file was actioned and a letter sent to the relevant insurers, it emerged that the claim had just recently prescribed.  The information on the file, in the diary system, in the retiring partner’s briefing note was all incorrect, out by a year.

Had the client provided incorrect information? Apparently not. How had the error occurred then?  Impossible to say whether the retiring partner’s error was the result of the illness which prompted his early retirement or just one of those slip ups that can afflict any of us from time to time.  Whatever caused it, the outcome was precisely the same.

How to avoid a recurrence?

The partner who had taken over the file resolved that, in future, when taking over a litigation file from a colleague, he would always undertake a careful review of the essential elements of the case to verify, among other things, that the prescription date had been correctly identified and diaried with appropriate countdown reminders.  The experience prompted him go further and to adopt a standard procedure of having a colleague verify his own assessment of the prescriptive date in all his litigation cases.    

Risk management points

The fee earner taking over responsibility for a file should read it thoroughly and ensure:

• that the terms of engagement agreed with the client are properly understood, any areas of doubt being clarified as soon as possible
• that everything undertaken to the date of transfer is correct and that critical dates have been verified and diaried properly
• Encourage fee earners who are leaving to identify problem or ‘skeleton’ files without fear of recrimination

Consider whether it may be appropriate in certain circumstances to conduct a thorough audit of all the departing fee earner’s files to identify any potential problems and deal with them, ideally while the fee earner is still in the office.

Transfers between departments/offices

Problems can also arise as a result of poor communications between different departments or different offices.

In larger practices, files may be transferred between different specialist departments. The conveyancing department may become involved in a corporate transaction, the litigation department may become involved in a conveyancing transaction etc.  There is potential in these situations for ineffective communication to result in incorrect assumptions being made and for errors and omissions to result.

Risk management points

Ideally, the instructions from one department to another should be as thorough as if the firm were contracting the work out to another practice.  It is suggested that there ought to be a standard form of instructions which should include:

• inventory of all documents being transferred and request for confirmation of receipt
• explanation of the current position and what requires to be done next
• indication of timescales and time limits and request for confirmation that critical dates have been noted, agreed and diaried with appropriate countdown reminders
• agreement about who will be responsible for the work on the file and who will be taking instructions from and reporting to the client – and who will be advising the client of all these arrangements
• discussion concerning fresh terms of engagement or amendment of the terms of engagement initially agreed with the client
• notification to other interested departments of the transfer of the file

Again, it is important that the recipient department verifies the critical dates and other essential points and does not make assumptions that the transferring department’s assessment of these matters will be correct in all respects.

The recipient department should check what has been said to the client that could have raised the client’s expectations as regards service or result/outcome. It may be appropriate to correct the client’s expectations if they have been raised unrealistically.

The information in this page is (a) intended to provide guidance on matters of practical risk management and not on issues of law and (b) is necessarily of a generalised nature. It is not specific to any practice or to any individual and should not be relied on as stating the correct legal position.

Alistair Sim is Associate Director in the Professional Liabilities Division at Marsh UK Limited  (e-mail: Alistair.J.Sim@marsh.com)