Involved in a legal malpractice or professional liability dispute? As you are likely aware, it is common for a legal malpractice claim to be countered by a fee claim by the lawyer defendant arising out of the former representation of the plaintiff client. The pendency of the fee claim raises some difficult issues with respect to consent and policy limits demands. Plaintiff usually couples the settlement demand with a condition that the counterclaim for fees be dismissed. If the lawyer defendant and counterclaimant refuses, then the insurer is not in a position to settle the malpractice claim because it does not have the consent of its insured. On the other hand, the insured lawyer and the plaintiff client may run the risk that the insurer may be insulated from liability for an excess of limits judgment as the insurer cannot settle without consent.
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