Things that Cause Professional Liability Lawsuits and Ways You Can Avoid Them
Being faced with a professional liability lawsuit can greatly impact a business. In some cases, it may make it difficult for them to survive because of the huge costs involved to fight the case. Furthermore, if charges have been proved against them, their survival may become even tougher for them.
If you are running a business, it is important for you to be aware of the things that can lead to professional liability lawsuits and the ways you can avoid them. You can find all the related information in this article. Continue reading:
What Causes a Professional Liability Lawsuit?
Some of the main causes that can result in a professional liability lawsuit for a company are:
Not Meeting the Set Industry Standards
If a company fails to meet the set industry standards while carrying out its routine operations, it may be charged with a professional liability lawsuit. Hence, it is important to follow all the set standards to ensure there are minimum chances of being faced with a professional liability lawsuit.
Breach of a Contract
It is another major reason why you may face a professional liability case. A company has different contracts with different parties i.e. consumer, supplier etc. If you breach any of the contracts, the aggrieved party may file a professional liability case against them. In case, a breach of contract from your end has caused financial losses or damages to them and they have proofs depicting the same, your firm can be convicted with the said charges.
In case a miscommunication has resulted in a misunderstanding between you and your client, you couldn’t provide them with the required service or products, it can also result in a professional liability lawsuit against your firm.
Delay in Meeting A Deadline
If you have failed to meet a deadline and this delay has resulted in a financial loss to your client, they reserve the right to file a professional liability lawsuit against your firm. Even if the delay was caused by some other circumstances beyond the control of your company, you may be held liable for the loss incurred. For example, if a construction business hasn’t been able to complete a project within the given time due to late delivery of supplies and the other party has to bear more expenses due to this delay, a professional liability lawsuit can be charged against the company by the aggrieved party.
Not many people are aware of the fact that the smallest of errors such as a typo can also result in a professional liability case. However, this is actually a reality. For example, if a printing company mistakenly enters the wrong number or address of their client on their letterheads, they can face this case against them.
Ways to Avoid a Professional Liability Lawsuit
Here are some of the effective ways a company can follow to avoid professional liability lawsuits:
With effective communication, there will be no misunderstandings between the parties; thus, the chances of a professional liability lawsuit caused due to misunderstanding or misinterpretation are minimized. If there are chances of delay in the completion of the project, it should be communicated to the client beforehand along with valid reasons. A better communication will result in a better understanding between an organization and its clients. Hence, minor issues such as a slight delay in meeting the deadline or typos will be neglected by the client.
In addition to that, it is also recommended to pay importance to follow-up communication. For example, do not forget to send a confirmation email containing all the important details after you have received an order. It will strengthen your position in court if a professional liability case has been filed against your firm.
Another effective way to avoid facing a professional liability lawsuit for a company is to ensure each contract is properly documented. This leaves little to no chance for the other party to sue you as you will have properly documented records in place. Even if they are filing a case, you can communicate with them and show the related documents to nullify their claim. This way, there are chances that they will take the case back and opt for an out of court settlement.
A Final Word
No matter what the cause of a professional liability case is, it can lead the company that has been charged with such a case to dire circumstances. Even if the decision of court eventually turns in their favor, this lawsuit can burn a huge hole in their pocket because of the expenses involved. Therefore, it is important to follow the above-mentioned ways, clauses of the contracts, and the set standards. This can help a company to save itself from facing professional liability lawsuits.
Brandon L. Fernandez is a native of Fort Lauderdale, Florida, and is an associate in the Lydecker Diaz's Miami office. Mr. Fernandez’s practice includes all aspects of federal and state civil trial litigation with a primary focus in civil rights litigation, complex commercial litigation, government liability, law enforcement liability, labor & employment law, premises liability, and professional liability.