Being sued for professional negligence can be one of the most stressful points in your career.
Fortunately, when such claims fall within the coverage terms of E&O’s Indemnity Plan, you have the benefit of being represented by experienced E&O staff lawyers or other experienced defence counsel, without paying any legal fees. This assistance is funded by the annual premiums collected by E&O from all licensees ($350 per year per licensee, unchanged for the past 11 years).
A deductible of $2,000 per licensee is only paid if an indemnity payment is made to the claimant, either in settlement or in payment of a judgment. If no damages are paid and the defence is successful, no deductible is payable.
Win or lose, trials are stressful
While not having to pay legal fees or potentially large awards of damages can be a relief to licensees, the time, effort, and stress of going through a trial can nonetheless be significant. We spoke with four licensees who recently went through trials with E&O staff lawyers about their experiences.
A Supreme Court case against licensee Bernadette Tam was dismissed after a week-long trial in 2021. The case took more than five years from start to end, preparation for trial was tedious, and Ms. Tam experienced anxiety throughout the process. However, she was impressed with the patience of the judge, and appreciated the advice and guidance she received from E&O. She found that her paper and electronic records were key in her defence, as was remaining calm and engaged.
What to expect in Small Claims Court
Licensees who are sued in Small Claims Court find the process just as stressful, although typically, resolution can be expected much faster, within 12 to 18 months of the lawsuit being filed. Most claimants who sue in Small Claims Court are self-represented and are given lots of leeway to advance claims that are sometimes not based in any reality. This can add to the stress you experience as a licensee.
A Small Claims case against licensee Marko Borck was dismissed following a two-day trial in 2021. Mr. Borck didn’t see any merit to the claim; he was surprised that the claimant, who’d initially been very pleased with his services, was able to take a baseless claim all the way to trial. He appreciated having the benefit of E&O’s services after having paid his premiums for some 30 years. He felt the process was fair and the right result was achieved in the end.
Another licensee who recently faced a two-day Small Claims trial told us that, while it was stressful, dealing with the claim had been a good learning experience, particularly regarding good record keeping. He felt the initial time he invested in retrieving electronic documents such as text messages was very beneficial to his defence at trial, given that with the volume of transactions he deals with, he didn’t have a perfect memory of every interaction with the claimant.
Other licensees we spoke with also found that having well organized, complete electronic records was essential to their defence. For more information on the importance of properly documenting your files, see “Good record keeping – it’s for your protection” by Brent Johnston in the June 2017 Risk Report.
Not every lawsuit proceeds to trial; most of the claims reported to E&O are resolved before that point. Of course, early resolution isn’t always possible or merited. When a claim proceeds to trial, licensees’ comfort with the court process is enhanced by good communication with defence counsel, preparation, and practice before trial.