Scottie Pippen
It’s not often that we get to make a point about malpractice prevention and mention an NBA great in the same blog entry – especially a player with the scoring caliber of Scottie Pippen, former Chicago Bulls forward and future NBA Hall of Famer. But this week LAW.com, an American Lawyers Media website, reports that Scottie Pippen was awarded a $2 million judgement in his lawsuit against the Chicago firm of Pedersen & Houpt in connection with a business arrangement involving Pippen’s purchase of a Gulfstream jet that he intended to charter out. The jet was grounded for repairs and Pippen was eventually sued by U.S. Bank for $6 million in unpaid loans that he didn’t know his business partner had incurred. Pippen sued his attorneys and testified that he didn’t know that he had gotten into a $7 million deal and his attorneys had a duty to inform him of the changed terms of the jet deal. The jury agreed and awarded him $2 million of the $8 million he had been seeking.
A lawyer can be the subject of an actionable malpractice claim if he or she deviates from the standard of care that is owed to their client regarding proper client communications during a business transaction. ABA Model Rule 1.4 Communication states that not only shall a lawyer keep a client reasonably informed about a matter, but that the lawyer, “Shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.” Such a duty means that the lawyer should know that the client has a full understanding about the terms of the business arrangement before the lawyer can rely on the client’s decisions regarding the agreement. The comment to the rule is helpful in determining the limits that a lawyer should go to explaining important matters to a client. It states that the client should have sufficient information to participate intelligently in decisions concerning the objectives of the representation, and that the lawyer should review all important provisions with the client before proceeding to an agreement. It is important to think about the client’s point of view when determining what is a reasonable explanation. The guiding principle is that the lawyer should fulfill reasonable client expectations for information consistent with the duty to act in the client’s best interests, and the client’s overall requirements as to the character of representation.
