The Ethics of Errors

Every lawyer makes mistakes—but not every mistake has to jeopardize a legal career. In “The Ethics of Errors,” legal ethics expert Tracy Kepler of CNA explores the critical importance of error disclosure, including how to identify, communicate, and ethically manage mistakes. Attorneys will come away better equipped to protect both their clients and their licenses.

When Must a Lawyer Disclose an Error?

Lawyers are ethically required to disclose material errors to clients. But what qualifies as “material”? According to ABA Formal Opinion 481, a material error is one that a “disinterested lawyer” would view as reasonably likely to:

• Harm or prejudice the client, or
• Cause the client to consider terminating the representation

This duty stems from Model Rules 1.4 (Communication) and 1.7 (Conflict of Interest). Rule 1.4 requires attorneys to keep clients informed, while Rule 1.7 addresses conflicts when an attorney’s personal interest in avoiding liability compromises their representation.

Notably, not every setback qualifies as an error. Some adverse case developments result from reasonable strategic decisions or factors outside an attorney’s control. For example:

• Missing a non-jurisdictional deadline due to client-imposed budgetary limits may not require disclosure.
  
• A weak claim that fails in court does not automatically mean malpractice occurred.
  

Questions to Determine Disclosure Duty

To determine if an error must be disclosed, consider:

1. Was there actually a mistake?
   
2. Is the error reasonably likely to harm the client or damage the representation?
   
3. Could the client reasonably want to fire you because of the error?
   

If the answer to any of these is “yes,” the duty to disclose is triggered.

What Should You Say When Disclosing an Error?

Disclosure is often the hardest part. Many lawyers struggle with how to have this uncomfortable conversation. The key is to focus on:

What to Include:

• Factual explanation of what happened
  
• Consequences for the client’s case or legal objectives
  
• Corrective options, if available
  
• Recommendation to seek independent counsel
  

What Not to Include:

• Any admission of liability
  
• Any suggestion that the client is entitled to a settlement or fee compensation
  
• Legal opinions on whether the client has a malpractice claim

Suggested Language

Follow the approach from Colorado Bar Association Opinion 113: advise the client that it “may be advisable to consult with independent counsel” regarding the impact of the error.

Who Needs to Be Informed?

The duty to disclose applies only to current clients. Once the attorney-client relationship has ended, Model Rule 1.4 no longer applies, and there is no affirmative duty to inform a former client of an error discovered post-representation.

However, if a former client mistakenly believes that you still represent them, you must correct that misunderstanding under Rule 4.3 (Dealing with Unrepresented Persons). This includes:

• Clarifying your role
  
• Advising them to seek independent legal advice
  

To avoid ambiguity, attorneys are encouraged to use closure letters when ending a representation, formally establishing the client as “former.”

How Should a Law Firm Structure Internal Consultations?

In-house ethics counsel or a designated general counsel can provide critical guidance after an error occurs. But firms must structure these roles carefully to preserve attorney-client privilege.

To protect intra-firm consultations:

• Maintain a formalized structure for in-house ethics consultation
  
• Ensure the consulting attorney did not work on the client matter
  
• Keep all communication confidential and separate from the client file
  
• Consult clients promptly after seeking internal guidance

Courts, including in Tattletale Alarm Systems v. Calfee, Halter & Griswold LLP, have upheld privilege for internal ethics discussions—if these standards are met.

What About Legal Malpractice Insurance?

Attorneys should contact their professional liability insurer promptly upon discovering an error—even if no claim has been filed.

Key Points on Insurance Reporting:

• Policies require notice of actual claims and often disciplinary complaints
  
• Reporting potential claims may also be advisable, especially during renewal periods
  
• Attempting to resolve the issue before notifying the carrier can void coverage

Most policies cover attorney-client privileged communications with the insurer as part of joint legal defense. But this varies, so lawyers should check their specific policy terms.

What Are the Risks of Not Disclosing?

Failure to disclose material errors can have serious consequences. Most jurisdictions recognize fraudulent concealment, where silence alone—especially from a fiduciary—can be enough to support a claim.

Consequences of Non-Disclosure:

• Fraudulent concealment claims
  
• Tolling of statute of limitations
  
• Professional discipline, including suspension or disbarment
  
• Punitive damages, which are not covered by malpractice insurance

The cover-up often worsens the situation, and silence may even substitute for active deception under many jurisdictions' laws.

Can the Attorney Continue the Representation?

Sometimes. Continuing representation after a disclosed error requires careful analysis under Model Rule 1.7’s four-pronged test:

1. The lawyer reasonably believes they can still provide competent, diligent representation
   
2. The representation is not prohibited by law
   
3. The matter does not involve direct adversaries
   
4. The client gives informed, written consent

Obtaining informed consent involves:

• Disclosing the nature of the conflict
  
• Explaining benefits and risks of continued representation
  
• Emphasizing the client’s right to seek independent counsel
  
• Allowing the client time to consider the decision

Any sign of duress or coercion can render a waiver invalid.

Key Takeaways

• Material errors must be disclosed to current clients when they may harm the case or affect the client’s confidence in the attorney.
  
• Model Rules 1.4 and 1.7 govern the communication and conflict aspects of error disclosure.
  
• Silence can be as dangerous as deception—concealing an error can lead to malpractice liability and professional sanctions.
  
• Internal ethics counsel and malpractice insurers can help navigate difficult situations, but protocols must be followed to preserve privilege.
  
• Face-to-face disclosure, followed by a written summary, is the best practice.
  
• Avoid admitting liability, but provide enough information for the client to make informed decisions—including the option to seek new counsel.
  
• Written waivers are essential when continuing representation, but only if the attorney can still act competently and without undue pressure on the client.

For a deeper dive on this topic, watch the full Lawline course “The Ethics of Errors,” presented by Tracy Kepler of CNA.

The content of this article is provided for informational purposes only and does not constitute legal advice.

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