Risk Management for Lawyers

Lawyers are under siege. We have become objects of scorn, ridicule, and occasional hatred. If you take your child to the Stephen Spielberg movie Jurassic Park, be prepared for the cheers when the cloned Tyrannosaurus Rex gobbles the lawyer—not a bad guy at all—cowering in the outhouse. In San Francisco a client burst into a California law firm and killed eight and wounded six persons before taking his own life. In response, the president of the California bar linked lawyer-bashing to hate crimes and prevailed on the Miller Brewing Company to withdraw a television commercial depicting a lawyer-roping rodeo in which a cowboy ropes an overweight tax lawyer playing the role of a calf—to the cheers of the Miller Lite crowd. Bizarre lawyer behavior, such as microwaving cats, adds to the problem, as does the perception that lawyers are drawn like vultures to the sites of mass disasters and are responsible for baseless law suits that drive up insurance costs. In such a climate, lawyers should recognize that every client is a potential adversary and manage the risk by practicing defensive law. This risk management does not mean that lawyers should put their own interests ahead of their client\u27s interests. To the contrary, the client and lawyer both benefit from defensive lawyering because the heart of the concept is accountability. Lawyers who run conflict checks, use engagement and non-engagement letters, keep their clients informed, are diligent with respect to law and fact, and refer matters beyond their competence to specialists serve both themselves and their clients well. This article suggests that law schools and bar associations should teach professional responsibility by teaching malpractice prevention and risk management. We start with a brief overview of lawyer malpractice, then move to principles of proactive risk management, and conclude with principles of loss minimization. Special attention is given to the bar-related insurance movement and the relationship between the malpractice carrier and insured lawyer. Two appendices are provided with this article: Appendix A, a checklist for preventing legal malpractice, and Appendix B, a risk management self-assessment questionnaire

Capital Structure and Team Performance in Professional Baseball

The successful production of major league sports has become increasingly dependent on stadiums. Although stadiums do not exhibit the properties of public goods, they have increasingly become governmentally funded projects. Lost in the political debate over stadium funding is the usefulness of the residual claimancy argument to the success of a team. If this argument holds, receiving a publicly financed stadium mitigates the incentive for an owner to place a competitive product on the field. The evidence in this article demonstrates that public ownership of a stadium negatively affects the winning percentage of the team that plays in it.

Risk Management for Lawyers

Lawyers are under siege. We have become objects of scorn, ridicule, and occasional hatred. If you take your child to the Stephen Spielberg movie Jurassic Park, be prepared for the cheers when the cloned Tyrannosaurus Rex gobbles the lawyer—not a bad guy at all—cowering in the outhouse. In San Francisco a client burst into a California law firm and killed eight and wounded six persons before taking his own life. In response, the president of the California bar linked lawyer-bashing to hate crimes and prevailed on the Miller Brewing Company to withdraw a television commercial depicting a lawyer-roping rodeo in which a cowboy ropes an overweight tax lawyer playing the role of a calf—to the cheers of the Miller Lite crowd. Bizarre lawyer behavior, such as microwaving cats, adds to the problem, as does the perception that lawyers are drawn like vultures to the sites of mass disasters and are responsible for baseless law suits that drive up insurance costs. In such a climate, lawyers should recognize that every client is a potential adversary and manage the risk by practicing defensive law. This risk management does not mean that lawyers should put their own interests ahead of their client\u27s interests. To the contrary, the client and lawyer both benefit from defensive lawyering because the heart of the concept is accountability. Lawyers who run conflict checks, use engagement and non-engagement letters, keep their clients informed, are diligent with respect to law and fact, and refer matters beyond their competence to specialists serve both themselves and their clients well. This article suggests that law schools and bar associations should teach professional responsibility by teaching malpractice prevention and risk management. We start with a brief overview of lawyer malpractice, then move to principles of proactive risk management, and conclude with principles of loss minimization. Special attention is given to the bar-related insurance movement and the relationship between the malpractice carrier and insured lawyer. Two appendices are provided with this article: Appendix A, a checklist for preventing legal malpractice, and Appendix B, a risk management self-assessment questionnaire

The impact of performance-based budgeting on state fiscal performance

Almost all American States have tried some form of performance-based budgeting, and this study examines the impact of this budget process innovation on state expenditures. Using panel data for 1970 through 1997 the findings indicate that performance-based budgeting curtails state spending per capita by at least two percentage points. However, not all state government programs are affected equally; some budget categories experience spending increases after the implementation of performance budgeting. The paper also examines the adoption pattern among states of performance budgeting rules. Copyright Springer-Verlag Berlin/Heidelberg 2004Budget process, fiscal rules, fiscal policy, state government finances, performance budgeting,