Law Times

Law times • OctOber 5/12, 2009 Fraud claims down Continued from page 1 liability, said LawPRO. Th e levy will be needed when the HST legislation passes sec- ond reading, at which point the insurer will have to account for the liability. But the annual report wasn't all doom and gloom. Th e real estate practice coverage option will drop to $400 from $500, but an increase in the real estate transaction levy to $65 from $50 will mildly off set that. Bencher Bob Aaron, however, questioned the need for any sepa- rate transaction levies at all. "For all small practitioners out there — those who do real estate and civil litigation — we're now going to have to have two kinds of transaction levies," he said. "It's going to be a headache for book- ing purposes, and I think the op- tics of having a higher transaction levy for real estate, higher than civil litigation, the optics are bad. And particularly when, from year to year, there's always a contest between which area of law — real estate or civil litigation — hits the top of the claims charts," he said. Caskey explained that the real estate levy is a "risk-related premium increase" that re- lates specifi cally to the claims LawPRO has received. "Th e information that our claims experience demonstrates is that real estate is in fact the problem area that has to have this increase refl ected, and it's felt to be actuarily and in insur- ance terms an appropriate risk- related premium increase, and it would not be appropriate, in the view of the board [of direc- tors], that this be refl ected un- der the other areas where there is a surcharge," said Caskey. Still, Caskey said the insur- ance program is performing well despite the diffi culties it faces. "LawPRO's position is sol- id," he said. "It continues to re- ceive a consistent A rating from [credit rater A.M. Best Compa- ny, Inc.], it continues to meet or exceed important regulatory re- quirements, its dedicated team is coping well with the infl ux of more complicated claims, and it continues to innovate for the benefi t of the profession." Caskey noted that 2008 fraud claims could cost the program about $9 million. But 2009 has brought an 18-per-cent reduc- tion from that level, he said. "Th at is an encouraging trend, but we do not take it lightly," he said. Caskey said LawPRO caught wind of at least 18 instances this year in which lawyers backed away from probable fraud at- tempts. He said the thwarted frauds could have cost the pro- gram up to $5 million. LawPRO is owned by the Law Society of Upper Canada and provides malpractice insur- ance to about 22,000 lawyers in Ontario. LT Fresh content delivered weekly. Canadian Lawyer | Law Times | 4Students | InHouse HouseAd-Online - page 7.indd 1 7/23/09 5:13:23 PM NEWS PAGE 3 More clients mean more conflicts Continued from page 1 interests along with amendments that stipulate circumstances in which a lawyer would be able to continue a retainer even when a confl ict is present. Th ose circumstances include "adequate disclo- sure to and with the consent of the client" and act- ing in matters that might be adverse to the interests of a current client but which are unrelated to any case in which the lawyer is already acting. Th e task force also looked at the potential for confl icting interests for in-house counsel; for government lawyers whose public sector obliga- tions remain in place "in perpetuity" even when they transfer to private practice; and for sole practitioners in small towns where confl icting interests may lead to a point where people have to go elsewhere for representation. "Is it a big issue? Absolutely, particularly for fi rms that have a large number of clients," says Domenic Crolla, fi rm managing partner at Gowlings. "Any major fi rm has to deal with this," he tells Law Times, adding that three major Su- preme Court of Canada rulings have made con- fl ict avoidance an inescapable necessity. "Th e net result of the Supreme Court of Can- ada's decisions has meant that we have to be par- ticularly vigilant to avoid confl icts of interest and have to regularly engage both our professionals to make sure their awareness is at a high level on the state of the law and also engage with our clients to make sure that we are free and clear." Darryl Cruz, litigation practice group leader at McCarthys, says confl icting interests some- times arise in the midst of separate retainers even if none existed at the outset. "You can have a scenario where there are two clients that are not in a confl ict and then, because things change over time, a confl ict arises," he says. "You have to speak to both parties and then fi gure it out. Sometimes, it means that the law fi rm has to stop acting for both." LT Visit us online! lawtimesnews.com canadianlawyermag.com Better Results Faster GET THE WESTLAW® CANADA ADVANTAGE DEEPER CONTENT MORE THAN JUST PRIMARY LAW Only Westlaw® Canada offers the sheer depth of content that helps you examine your case or issue from every angle. Go beyond case law and legislation to get the true insight you need. www.westlawcanada.com Carswell_LT_Oct5/12_09.indd 1 www.lawtimesnews.com 9/30/09 11:27:39 AM

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