We know that you take pride in delivering an excellent standard of service for your clients, but we also know that things sometimes go wrong.
Facing a professional negligence claim can be unsettling for any business owner.
However, you can mitigate the impact of any claim with swift, proactive action that protects your financial position and reputation.
Understanding the claim
Accusations of professional negligence typically arise when a client or customer claims that your business failed to deliver goods or services to an expected standard – typically resulting in financial loss or other damages.
Common examples include:
A professional negligence claim is not an ideal situation for a business, but it is important to remain objective and act quickly but cautiously.
Understanding the details of the accusation is the first step, including:
You can then consult your solicitor to understand the validity of the claim.
Formulating your response
You will likely be notified by the claimant that they are unhappy with the service provided informally, via a letter or email, as a first step.
Responding promptly and professionally to the claimant is essential, and it is important that you acknowledge their point of view and show that you are taking the matter seriously.
Collate any evidence of your work with the client, including emails, contracts and reports.
Assessing resolution options
Initially, you should try to come to an agreement with the claimant informally before proceeding to litigation or alternative dispute resolution (ADR), such as mediation.
Conduct an internal review to determine the legitimacy of the claim and how you might be able to improve next time.
You may also discuss with your solicitor the merits of defending the claim or agreeing a settlement with the claimant, depending on the outcome of your review.
Supported dispute resolution
If this approach is unsuccessful, you may need to proceed to ADR or litigation.
ADR, such as mediation or arbitration, is a popular choice because it is often quicker and less costly than litigation, while maintaining professional relationships.
Additionally, certain forms of ADR can still result in a legally binding outcome that compensates the claimant for damages where necessary and gives all parties the opportunities to present their evidence and perspective.
However, litigation is sometimes necessary.
If the claim is substantial or complex, the claimant may file with the Courts, at which point you will be expected to present your evidence and comply with the outcome.
This can be a challenging time for your business, but you can optimise your chances of success by:
To avoid professional negligence claims, make sure that you agree clear expectations and success measurements with clients at the start of your relationship.
Our Dispute Resolution team can help if your business is facing a professional negligence claim. Contact us today to find out more.
