For practicing accountants, a
major source of litigation stems from
clients' allegations that their accountant
failed to perform services that were outside
the scope of the accountant’s engagement.
Fortunately, there is a
straightforward and cost-effective way to
greatly reduce the risk of such litigation:
the engagement letter. An engagement
letter can reduce the risk of lawsuits by
removing doubt about the nature and
scope of the agreed-upon services.
Without a properly drafted engagement
letter, such litigation can be a timeconsuming
and costly nightmare. With
an engagement letter appropriately
tailored to the practice and scope of
services to be covered, an accountant
can greatly decrease the risk of controversy
and increase the chances for
speedy and favorable resolution of
claims.
The Sarbanes-Oxley Act and Private Companies: Understand the Implications
By now just about everyone in
corporate America has heard about the
Sarbanes-Oxley Act of 2002, which was
enacted with much fanfare in response
to several notable corporate scandals
involving large publicly-held companies.
Although the Act and subsequently enacted
interpretive rules are intended to
address the corporate governance practices
at public companies and the conduct
of the professionals who serve
them, such as accountants and lawyers,
a number of the Act’s provisions can impact
private companies, both currently
and in the context of future dealings that
these companies may engage in.
Lender’s Counsel Granted Summary Judgment on Claim by Borrower
In a legal malpractice action
brought by a residential real estate
purchaser against the lender’s closing
attorney, a Massachusetts Superior
Court judge awarded summary
judgment to the attorney after concluding
that no reasonable jury
could find that either an attorneyclient
relationship existed between
the plaintiff and the defendant, or
that the defendant otherwise owed a
duty to the plaintiff. Fistel v. Torrey,
et. al, 16 Mass. L. Rep. 479 (2003).
The Massachusetts Appeals Court Confirms that Mere Negligence will not Give Rise to a Claim under M.G.L. Ch. 93a
In a claim by a patient
against a doctor for violation of
Mass. Gen. Laws c. 93A
(Massachusetts Unfair Trade Practice
Act), the Massachusetts Appeals
Court affirmed summary judgment
in favor of a doctor, finding that
the facts in the light most favorable
to the plaintiff amounted to nothing
more than negligence and there was
no support for the argument that the
doctor’s actions towards the patient
were unfair or deceptive. Darviris v.
Petros, 59 Mass. App. Ct. 323
(2003).
Court Denies Emotional Distress Damages in Legal Malpractice Action
A Massachusetts Superior
Court judge recently ruled that the
plaintiffs could not recover emotional
distress damages in a legal malpractice
action. See Iacono et al. v.
Boncore et al., 2003 Mass. Super.
LEXIS 270.
Reversible Error in Legal Malpractice Action Found in Exclusion of Written Offer of Employment as Proof of Causation and Damages
In a legal malpractice action
in which a client claimed he
relied on his attorneys’ negligent
advice concerning an employment
contract, the Massachusetts Appeals
Court reversed the trial
court’s dismissal, ruling that the client
had the burden but should have
been given the opportunity of demonstrating
that he would have
reached a more favorable outcome
with his employer had the attorneys
exercised adequate skill and care.
Shimer v. Foley, Hoag & Eliot LLP,
59 Mass. App. Ct. 302 (2003).
Rule 4.2 Permits Ex Parte Communications with Unrepresented Former Employees of an Organization
The Massachusetts Supreme
Judicial Court (“SJC”) recently
held that a lawyer’s duty to
refrain from ex parte contact with
represented parties, pursuant to
Mass. R. Prof. C. 4.2, as amended,
437 Mass. 1303 (2002) (“Rule
4.2”), does not restrict ex parte access
to an adverse party’s unrepresented
former employees. Clark v.
Beverly Health and Rehabilitation
Services, Inc., et al., 440 Mass.
270, 275-76 (2003). In Clark, the
SJC builds upon a trend evident in
certain of its recent decisions, including
Messing, Rudavsky &
Weliky, P.C. v. President & Fellows
of Harvard College, 436 Mass. 347
(2002) and Patriarca v. Center for
Living & Working, Inc., 438 Mass.
132 (2002), which promotes free
access to “material facts” and a
“litigant’s need for information” over
an “organization’s need to protect
its legitimate interests.” See Clark,
440 Mass. at 275-76. |
