What is Risk Management?

by Christian A. Stiegemeyer, Director of Risk Management
The Bar Plan Mutual Insurance Company

Understanding the nature and type of the benefits and consequences to engaging in particular conduct and implementing systems and procedures to avoid the potential consequences of the behavior is the very nature of Risk Management. Everyone takes on a certain amount of risk in their lives everyday by getting into a bathtub, driving a car, working, playing, etc. We also take precautions to limit the risks involved in those activities, for example, by not putting an electric fan close to the bathtub and, when we drive, wearing a seatbelt.

Lawyers take on risk every time they accept or decline a representation or take action on behalf of a client in a case. By doing so, the lawyer risks possibly engaging in unethical behavior that could result in discipline or being sued by a client for malpractice. The keys to reducing the risks inherent to the legal profession are no different than in everyday life. First, there must be an awareness of the existence of possible risk. Second, the specific nature of the risks in a particular situation must be acknowledged and forthrightly addressed. Third, there must be a willingness to take the appropriate action in the circumstances to minimize or eliminate the exposure to the risk.

Some of the more common areas where lawyers encounter fairly easily avoidable risks are: creating or avoiding the attorney-client relationship; determining, calendaring and tracking statute of limitations and other deadlines; understanding the distinction between privileged and confidential information and protecting the information accordingly; recognition, avoidance and/or waiver of conflicts of interests; and, appropriately defining and limiting the scope of the representation.

Lawyers will always have questions about their professional duties or malpractice risk throughout their careers. Some good resources for resolving these questions include: The Missouri Rules of Professional Conduct, found under Rule 4, in the Missouri Supreme Court Rules; the Missouri Office of Chief Disciplinary Counsel, which can provide answers to lawyers questions either by telephone inquiry at (573) 635-7400 or written Informal Opinion by sending an inquiry to: OCDC, 3335 American Ave., Jefferson City, MO 65109-1079; the ABA Model Rules of Professional Conduct and the ABA website at www.abanet.org (also, the Annotated Model Rules of Professional Conduct, 4th Edition is very helpful); Restatement of the Law Third, The Law Governing Lawyers; The Bar Plan Mutual Insurance Company Hotline at (314) 956-3333, (800) 843-2277 or www.thebarplan.com; The Missouri Bar at www.mobar.org; and Continuing Legal Education.