The Lawyer reports today that the U.K.-based international law firm Withers has lost its appeal of a GBP 1.6 million (US$ 2.4 million) professional negligence judgment arising from an associate's defective drafting of an LLP agreement. The plaintiff, Wellesley Partners, had been a long-standing Withers client. The trial court found that a Withers associate's "misremembering" of his instructions ultimately resulted in losses to the plaintiff of more than GBP 1.5 million in London and in the United States, plus substantial additional internal costs.
What a disaster! In addition to a significant financial loss, Withers has lost a long-standing client -- probably forever -- and the firm's reputation for quality, even in a relatively simple associate task, has been damaged -- possibly for a long time.
Mistakes happen even in the best firms, but mistakes like this can be prevented. This is the type of professional catastrophe that a quality assurance system can prevent. The goal of quality assurance is more than catching and fixing mistakes after they happen. Instead, quality assurance identifies the risks of substandard work and prevents mistakes from happening.
Moreover, quality assurance produces a gigantic return on investment. It improves productivity and profitability by reducing the amount of time that lawyers must spend fixing mistakes that could have been prevented. It also can reduce the risk of large losses, both financial and reputational.
Quality assurance systems are not expensive to design, install, or manage, neither in terms of consulting fees to set up the systems nor in the time and attention needed to operate them. In addition to preventing disasters like the Withers case, they have become one of the most important set of profitability tools for law firms that face increased resistance to higher fees.
A serious quality assurance system also can help differentiate a law firm from competitors who talk a lot about "quality," but have few if any effective means to deliver it. Sophisticated consumers of legal services are persuaded by demonstrated, functioning quality assurance systems, not slogans.
Quality assurance systems are easily within the financial reach of even the smallest law firms. In fact, they probably are even more important in smaller firms because of the disproportionately large financial impact that mistakes can produce.
We can help firms that want to avoid disasters like the one that Withers has experienced, as well as to make clear, measurable improvements in their profitability and reputations. Walker Clark members have been advising lawyers, law firms, and corporate and government legal departments on quality assurance matters since the early 1990s. For more information about our quality assurance services, click here.