The risk management benefits of using checklists in legal practice, some caveats, and helpful resources

Soon after I joined Lockton, I read about a professional negligence claim that had been made against a law firm. The firm had been acting in a personal injury matter. The client, Mrs Smith, had been on a flight and one of the cabin crew had opened an overhead luggage locker. A laptop shifted and fell out on to Mrs Smith’s head causing her injury. It had taken the law firm a while to investigate the case: liability was denied, and the medical position was uncertain. The law firm had been progressing matters and, when they last checked on timescales, it was two and a half years post-accident. The solicitors had thought that they had plenty of time to raise the action. However, they had forgotten that, in respect of accidents in the air (which includes “air side”, i.e. before disembarking) the time limit is two years.

Later, I read about a second claim. In this case, a law firm had been acting on behalf of a client in the purchase of a property. There was an outstanding inhibition against the seller, which was listed in the search report produced in advance of settlement but went unnoticed by the purchaser’s solicitor. It was not addressed at, or prior to, settlement. The inhibitor raised an action for reduction of the disposition in favour of the purchaser and the related standard security in favour of the lender. The solicitors who had overlooked the existence of the inhibition were at a loss to explain how this had occurred.

While these claims might seem, on the face of it, completely different, they both involved a simple oversight or omission on the part of the solicitors. In the first example, the oversight was that the injury was not checked against prescriptive time limits. In the second example, an outstanding inhibition in a search report had not been spotted.

Benefits of using checklists

These types of situation, involving oversights and omissions, have featured regularly in Master Policy claims over the years. The examples illustrate how claims can arise where solicitors overlook or omit steps in the multitude of tasks they perform every day. 

In the scenarios outlined, a variety of risk management controls and tools might have been effective in addressing the risks. For example, file review meetings, diary systems, reminder systems, and further training, could all have helped to avoid a professional negligence claim. However, one powerful and simple tool that might have avoided these errors is the simple checklist: a series of steps that prompts consideration of points to be (double) checked.

It is now a well established principle that, no matter how expert you may be, a well designed checklist can improve outcomes (see The Checklist Manifesto by Atul Gawande for a number of examples of how checklists have improved practice in other sectors). How often have you gone into a supermarket without a shopping list and then gone home having forgotten to buy some items? Memory alone can be unreliable, and checklists, devised in a user-friendly way, can help reduce the risk of important issues being overlooked. This is why many firms use a range of comprehensive and suitably adapted checklists for all types of work.

Risks of using checklists

There are, of course, risks associated with relying too heavily on checklists. The danger is that the process takes over and the checklist becomes a substitute for independent thought. The insurers have advised that they have seen too many cases where a checklist is just blindly followed, without any real thought being given to it.

It’s worth remembering that a checklist is intended as an addition to, and not a substitute for, an intelligent appraisal of a transaction or case. It must be combined with professional judgment and consideration of all of the issues.

There have also been arguments over the years that checklists are, at least to some extent, inappropriate and that solicitors should be using their own experience to cover the points which may arise. There is obviously no point in having a lengthy checklist stapled inside a file if those handling the business do not discipline themselves to completing it. If a shorter checklist which does not cover every eventuality is more likely to be used, then that may be the better option.

However, there is no doubt that checklists of some kind have their place in professional practice. They can assist as an aide-memoire to prompt consideration of critical issues that might otherwise be overlooked. With more complications and potential traps to contend with in practice today, there is far more to remember than ever before, and more that might be overlooked. Furthermore, checklists help you focus, make it easier to prioritise tasks and help manage complexity.

Lockton styles

Lockton has devised a set of checklists that are available online at www.locktonlaw.scot. Our most recent checklist for Scottish solicitors forms part of our Property Purchase Questionnaire, a downloadable resource for conveyancers. The questionnaire itself is designed to assist conveyancing practitioners in capturing the main details of a client’s purchase and to provide a prompt to clients to notify their solicitor of any non-standard aspects. It includes a short checklist of issues at the end of the document, intended for solicitors to be able to use as an aide-memoire should they choose to do so.

We have also published a Notice to Quit Checklist to help solicitors avoid some of the common pitfalls when serving a break notice for leased premises; and a Red Flag Wills Checklist to help solicitors identify areas of risk when drafting a will. Again, these items are available on the resource centre on the Lockton website. These particular checklists are not intended to document every single step in the process but are designed to highlight the “red flag” areas which, in our experience, can lead to issues with clients or Master Policy claims.

We are interested in continuing this work, and please get in touch with us if there is a particular area of practice where you would like to see a bespoke Lockton checklist developed. Our checklists are given as templates and firms will of course want to adapt and use their own styles; these should be constantly tested, refined and reviewed on a regular basis. The firm should have in place a system for such reviews.

Preventing mistakes and creating structure

The value of checklists is arguably justified by referring to the number of recurring themes in the Master Policy claims experience where checklists have had the potential to make a difference to the record of claims arising as a result of oversight or omission.

More generally, it’s always useful to have a structured approach to our daily professional practice. This becomes critical in times of uncertainty. Over the last year and a half, with the ever-changing situation we have faced as a nation and the level of uncertainty for all professional service firms, the checklist may have been our most essential risk management tool.  

The Author

Matthew Thomson is a client executive in the Master Policy team at Lockton. He deals with all aspects of client service and risk management for solicitor firms in Scotland.
t: 0131 345 5573; e: matthew.thomson@uk.lockton.com

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