This article was originally published in the December 2006 issue of GPSOLO Magazine, a publication of the American Bar Association.
No rules or case law to date specifically require lawyers to anticipate disasters that could disrupt the lawyer’s practice and prevent the lawyer from representing existing clients. Yet, disaster preparedness should no longer be considered optional for lawyers who practice in harm’s way where natural disasters such as hurricanes and earthquakes are foreseeable. The experience of lawyers who have gone through a natural or man-made disaster provides ample proof of the need to have an emergency preparedness plan in place to reduce manageable risks and to be able to recover should an actual disaster strike.
Available statistics reveal that only a small fraction of law firms have established a disaster recovery plan, and those that do may not have an adequate or up-to-date plan.2 Experience has shown that most businesses that experience a major disaster are no longer in business within five years and only about 25% of businesses in the United States have prepared for disaster recovery.3
The tragic events of September 11 and the experiences of lawyers in the wake of Hurricane Katrina and Hurricane Rita have brought to the forefront the importance of disaster preparedness. Earthquakes and hurricanes are surely to occur in certain parts of the country, although when and exactly how they will affect a particular law practice may not be precisely known. Other forms of disasters are not geographically specific but still have the potential for disrupting a lawyer’s practice and causing harm to clients. Disasters requiring a recovery plan can be broadly characterized as natural disasters, such as earthquakes, fires, and hurricanes, technological disasters, such as computer failures and viruses, water damage and power outages, man-made disasters such as acts of terrorism, thefts and other crimes, disasters caused by human error, such as an accidental deletion of computer files, lapses in security and other unintentional acts, and personal disasters such as death or long-term disability.4 Reacting to a disaster after the fact is no substitute for foresight and planning. As the saying goes, “failing to plan is planning to fail.”5
Your Responsibility to Plan Ahead
Issues of professional responsibility can arise when disasters are foreseeable and there is no emergency plan in place, or the law firm’s disaster plan is inadequate or an adequate plan exists but the lawyers and their staff fail to follow it. Lawyers stand in a fiduciary relationship with their clients which obligates lawyers to act in their clients’ best interest. The ABA Model Rules provide that in all professional functions, a lawyer should be competent, prompt and diligent.6 This includes having reasonable measures in place to be able to communicate with clients and taking reasonable precautions to protect the clients’ confidential information. Lawyers must also be able to account for and safeguard funds and other property of clients and third persons in the lawyers’ possession. A partner in a law firm and a lawyer who individually or together with other lawyers possesses comparable managerial authority in a law firm must make reasonable efforts to ensure that the firm has in effect measures giving reasonable assurance that all lawyers in the firm conform to the rules of professional conduct. Lawyers having direct supervisory authority over another lawyer must also make efforts to ensure that the supervised lawyer conforms to the rules, and a supervised lawyer has a duty to conform to the rules despite being supervised.7 Therefore, the obligation to have a viable disaster recovery plan extends to both the individual lawyer and the law firm. Indeed, effective disaster preparedness involves not only the diligence of lawyers and law firms, but the coordination of local and state bar associations and government agencies as well.
The foreseeability of events that could materially disrupt a lawyer from carrying out the representation imposes an obligation to take reasonable steps to manage the risks. For example, lawyers who practice in California are forewarned of the chances that an earthquake could materially disrupt their practice just as lawyers who practice in the Gulf Coast are painfully aware of the effects of devastating hurricanes. Enough is known about the predictability of these types of events and the gravity of the resulting injury that it is reasonable to expect lawyers to have reasonable measures in place to reduce the risks to their clients and to plan to continue to function should an actual disaster strike. This does not mean that lawyers are expected to have an emergency action plan that will effectively prevent disasters from occurring or guarantee that the lawyer’s services will not be disrupted as a result of a major event. Courts will most likely take the nature of the catastrophic event into account in determining whether a lawyer has acted reasonably during and following a disaster. Still, lawyers owe their clients a duty of care to exercise the competence and diligence normally exercised by lawyers in similar circumstances.8 Given the realties of today’s practice, it would not be prudent for lawyers to regard a natural or technological disaster as simply an “Act of God.”9
The rules of professional conduct do not exonerate lawyers because a disaster occurs. It is reasonable to assume that the rules normally applicable to attorney conduct will continue to apply even if a disaster strikes.10 For example, a Michigan State Bar ethics opinion concludes that when a closed client file in an attorney’s custody is damaged by an event beyond the attorney’s control, and the period for retaining the records has not expired, or the attorney has failed to establish a record retention policy or communicate such a policy to the client, the attorney should make reasonable efforts to notify the client. The notice may advise the client that the damaged file will be destroyed unless the client wishes its return.11 In another case, a computer virus that destroyed a lawyer’s billing records did not excuse the lawyer’s failure to comply with his or her recordkeeping duties.12 In that case, the North Dakota Supreme Court held that the lawyer’s failure to maintain duplicate billing records and to account for a portion of the advance fees violated North Dakota’s Rule 1.15(f) which requires lawyers to keep records sufficient to demonstrate compliance with the rule for six years after the end of the representation. The court stated that: “Although it is unfortunate that a computer virus destroyed Ward’s backup billing record files, it does not relieve him of his duty to maintain records.”13
Common Elements of an Effective Plan
Checklists and other resources for developing a disaster recovery plan confirm that the primary objectives are to best assure the safety of attorneys and law firm personnel and to restore as soon as possible the firm’s ability to deliver legal services to clients. Experience teaches that the plan must be flexible to deal with changing and unexpected circumstances. Plans need to be frequently re-evaluated as changes occur in the law firm’s practice, size, and location and as attorneys and staff come and go. A central feature of an effective plan is the ability to communicate with law firm members and clients following a disaster and to access firm documents and client files. Computers and wireless technology have proven to be important features of an effective plan for lawyers and for the judicial system. Having the ability to function following a major disaster includes having both the physical as well as the financial capacity to survive. A disaster plan should account for the fact that lawyers may be working in difficult conditions with limited access to phone service, computer files and the Internet. Solo practitioners and small firm lawyers should consider pre-arrangements with counsel outside the affected area – with the clients’ permission – to assist in communicating with clients and protecting the clients’ interests during and immediately following a disaster. Lawyers who utilize offsite storage companies and other vendors for outsourcing bookkeeping and other functions should make sure that the company also has an adequate disaster recovery plan. It may be advisable to inform clients about the firm’s disaster planning so that the clients can be prepared and will know how to communicate with the law firm after the emergency subsides. Having the financial ability to continue to practice following a disaster includes having adequate insurance, financial lines of credit and other resources available to resume legal services. It is important for local and state bar associations to disseminate information and provide means of coordinating disaster recovery in affected areas. Education and training provided by bar associations and other professional organizations are also important.
2 See, Nava, Hurricane Katrina: The Duties and Responsibilities of an Attorney in the Wake of a Natural Disaster 37 St. Mary’s L.J. 1153 (2006); Rose, Steps to Take in Recovery Effort – From Planning to Living the Reality ABA Annual Convention (2005) [www.abanet.org/tech/ltrc/publications/recover.pdf] ; Freedman, Preparing for and Recovering From . . . .Disaster (28 Penn. L. 44 (January/February 2006).
3 Note 2, supra.
4 See, e.g., Calloway, Preparing for the Unexpected: Anticipate and Plan for Law Offices Disasters, 67 Alabama Lawyer 254 (2006)).
5 See, Binder, Emergency Action Plans: A Legal and Practical Blueprint, 63 U.Pitt.L.Rev. 791 (2002).
6 ABA Model Rules Preamble .
7 Model Rules 5.1(a) and (b), and 5.2.
8 Restatement of the Law Governing Lawyers 3d, §§ 48, 50, and 52.
9 See Binder, Emergency Action Plans: A Legal and Practical Blueprint, supra, Note 5; and see Keim, “Law Firm Disaster Preparedness: The Liability and Ethics of Lawyers,” 80 Fla.Bar J. 26 (2006).
10See Nava, Hurricane Katrina: The Duties and Responsibilities of an Attorney in the Wake of a Natural Disaster, supra, Note 2; Task Force on Law Office Disaster Planning, The Lawyer’s Club of San Francisco, When Disaster Strikes: How to Handle Law Office Emergencies, 1988 ABA Sec. Econ. L. Plac. 1; Glesner, The Ethics of Emergency Lawyering, 5 Geo.J. Legal Ethics 317 (1991).
11 Michigan State Bar Formal Opinion RI-109 (1991).
12 In the Matter of Ward, 701 N.W.2d 873 (N.D. 2005)13701 N.W.2d at 877.