Time is Money: The Failure to Proactively Screen Legal Counsel May Cost a Business Both
Updated: Aug 19, 2020
Businesses should identify and interview lawyers before they need them.
Understandably, decision-makers do not always have time to thoroughly vet their legal counsel prior to hiring them. In fact, in the litigation context, the need for legal counsel often pops up unexpectedly and businesses have a short time to react. In these circumstances, time is a scarce and valuable commodity.
Waiting until a legal need arises to choose counsel is a risk because retaining the wrong attorney can be costly. Consider the following example based on the case Ballistics Research, Inc. v. Bri Funding, LLC., 783 S.E.2d 678 (Ga. Ct. App. 2016).
A corporate plaintiff was assigned the right to bring a lawsuit against a corporate defendant with which it never dealt. The plaintiff sued the defendant and sought punitive damages.
Despite clear Georgia law that punitive damages claims are not assignable, the defendant never pointed that out to the trial court. Consequently, the trial court ordered the defendant to pay almost $900,000 in punitive damages.
The case was appealed. The appellate court emphasized that Georgia law prohibits the assignment of punitive damages claims, but then recognized that the defendant never made that argument. Therefore, the punitive damages award stood -- although reduced to $250,000 for a separate reason. Nevertheless, the defendant became obligated to pay a quarter of a million dollars in punitive damages to an entity not otherwise entitled to punitive damages.
Maybe a little research and a few interviews are worth the effort . . .
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Disclaimer: This post is for general information purposes only and is not intended to be and should not be taken as legal advice.