Warren Buffett remarked that ‘only when the tide goes out do you discover who’s been swimming naked’. Professionals may – rightly or wrongly – be targets for the deflection of some of the ensuing embarrassment. Professional negligence claims are already on the increase.
Since the last boom in professional negligence claims (which led to developments in the applicable law) developments in other areas have occurred that will impact the professional negligence sphere. One important development concerns the circumstances surrounding the settlement of claims involving multiple professional defendants.Take a complex corporate transaction involving lawyers and accountants, corporate financiers and numerous consultants. After completion, a problem emerges that was missed by the lawyers and accountants and undervalued by the consultants. The ‘loss’ is the overpayment of the price for the shares. The shared responsibility involves parties with different approaches to claims and varying perceptions of the merits, each looking to pass the buck.
