Step One: Pick an Experienced Lawyer.
Controlling the success of your litigation file starts with
selecting the right lawyer. The quality of the outcome can only be as good as the
individual lawyer's knowledge, experience and training. As an adjuster, you are seeking a
lawyer to defend a suit against your insured and it is important that you select a
particular lawyer, rather than just a law firm. Any business is only as good as its
people, and this becomes especially true when the competence of the lawyer you select will
determine how successful the outcome of the litigation. Picking the wrong lawyer could be
the equivalent of throwing premium revenue out the window.
First, you must find an experienced lawyer. That means finding one
who has successfully defended a number of very similar matters. An experienced lawyer can
often work more quickly than an inexperienced one and ultimately save you money. Lawyers
bill on an hourly basis and you do not want to pay a lawyer to "reinvent the
wheel." An experienced lawyer will also have the benefit of knowing the court
personnel and other attorneys involved in the case. This can increase your chances for
smooth negotiations and a quick, favorable resolution.
Hiring the right attorney takes some time. It is time well spent,
however. Do not merely flip through the directory or pick a firm based simply on its size.
Large firms are often full of associate attorneys with not much experience. You would have
to pay top dollar and have a commanding legal problem to get the personalized attention of
a partner level attorney in most big firms.
Smaller firms often specialize in particular fields. If an adjuster
can find a small firm lawyer experienced in defense, that small law firm can often offer
the adjuster lower overhead without compromising efficiency or service. Also look for a
highly automated law office. The time savings and efficiency that results can ensure a
better work product, shorter turnaround time, and corresponding lower billings.
Remember that litigation is rarely a pleasant or quick experience.
You will be working very closely with your lawyer, and perhaps for an extended period of
time. An adjuster should always look for a litigation partner who is competent, open,
honest, experienced, fair and willing to put all arrangements in writing.
Step Two: Assess your Inventory and
Resources.
This step is crucial in developing your strategy. Will you strive a
settlement no matter what the terms, or will you take the case to verdict no matter what
the offer? As with any controversy, each side must assess their combat "tools"
before actually engaging in the battle. Knowing what you have and how it will be used will
determine how you should fight, how well you can fight, and how long you can stay in the
battle. Some of the resources to consider are:
Money. Litigation is a marathon, not a sprint. The
outcome is sometimes determined by who can afford to stay in the race the longest.
Consider whether or not you are able to allocate the "stamina" for the loss in
question.
Time. In determining whether or not you have the
money to engage in the fight, you must also consider that litigation consumes a lot of
time as well. Consider whether this time will be well spent.
Existence and Verification of Facts. Before
engaging in litigation, you must make sure you have completed your file and taken every
step to investigate the loss. Your background work will not only help you decide whether
or not the claim is worth defending in court, but you will avoid having to pay the lawyer
to do this background work for you.
Reputation. Unfortunately, litigation always
results in someone being labeled the "good guy" and someone the "bad
guy." The result of any particular litigation is completely unpredictable. If you
can't afford to be labeled the bad guy, then don't go to trial.
Nature of the Judge, Jury and Jurisdiction. We all
have predispositions. Judges and jurors are no different. You must consider the past
verdicts rendered in your jurisdiction. If the court jurisdiction you are in has
consistently favored plaintiffs, cut your losses and consider an early settlement.
Existence and Credibility of Fact Witnesses.
Whether decided by a judge or a jury, the case will turn on how believable your fact
witnesses are. If the Plaintiff has better witnesses, then the Plaintiff will most likely
win the case.
Credibility and Necessity of Expert Witnesses.
Expert witnesses are also scrutinized. Consider their necessity and the weight their
testimony may carry. Then factor in how expensive they can be.
Step Three: Make a Plan and Stay Involved.
Once you have assessed your resources, you and your attorney are
ready to make an informed plan of defense. You must first create that plan before you can
decide on an agreeable outcome. Sit down with your lawyer and plot a detailed course of
action that contains a budget estimate. This will serve as the lawyer's guide as he
advocates on your insured's behalf.
Once the litigation plan is in place, the adjuster must maintain
contact with the lawyer to see that the plan is being implemented. If an adjuster
procrastinates or ignores the legal management process altogether, it can only lead to an
extended litigation period, higher legal bills and a resolution at or over the reserve.
Adjusters should always take it upon themselves to understand what happens at each phase
of the negotiations or the lawsuit and what is expected to happen next.
In being involved, it is important that the adjuster know the pros
and cons of the case. An open and honest relationship with the attorney is the only road
to making informed decisions. You aren't paying the lawyer to gloss over the "bad
news." Insist on hearing it all.
A good attorney will welcome this sort of contact. Every action the
lawyer takes should be part of the overall litigation plan carefully developed by you, the
insured and the lawyer, with the end goal being your and your insured's satisfaction with
the outcome.
Polk & Associates
June 2001