How Environmental Lawyers Can Avoid Getting Sued For Legal Malpractice?

No matter how conscientious, environmental lawyers, like other attorneys, are regularly sued for legal malpractice.  It is not difficult to imagine some of the dicey situations where the environmental practitioner may fall prey to such claims:

(1) a municipality sues its lawyer after the municipality defaults on its bonds because of an unforeseen environmental problem that prevented the subject property from being developed. The lawyer is accused of not having described the risks inherent in the property’s development and for not conducting a proper environmental investigation;

(2) a landfill developer sues its lawyer after failing to obtain a landfill expansion permit because the lawyer failed to provide legal notice of the proposed expansion to adjacent landowners;

(3) the purchaser of commercial property sues its lawyer after discovering contamination on its recently obtained property, claiming that the lawyer never informed it of the existence of prior environmental violations or the consequences of an “as is” clause in the purchase agreement;

(4) a New Jersey seller of an industrial parcel sues its lawyer after discovering that it retained significant post-closing environmental liability under the ISRA statute; and finally,

(5)  a cost recovery plaintiff sues its lawyer for failing to pursue all relevant parties in a cost recovery litigation.

Is there a strategy for the environmental practitioner to defend these claims, or to prevent them from being brought in the first instance?  Michael L. Shakman, Diane F. Klotnia, and Edward W. Feldman, partners at Miller Shakman & Beem LLP in Chicago, have written an excellent article titled, “Why Do Environmental Lawyers Get Sued for Malpractice? What Can They Do to Avoid a Malpractice Claim?”  that appeared in the Bloomberg BNA Toxics Law Reporter, 28 TXLR 1285, on November 21, 2013.

The primary takeaway of Shakman et that it is imperative to document in writing precisely what the scope of the retention will be and the tasks to be undertaken pursuant to that retention, and what it won’t be– those tasks that are NOT included in the retention.

In the scenarios described above, some of which are reported by the authors, there is often stark disagreement between lawyer and client concerning either the scope of the retention or the tasks to be performed. Sometime the dispute is over when the retention ended.  Here, then, is the authors’ advice (both quoted and paraphrased:)

(1) Eliminate uncertainty at the outset of the representation by clearly and explicitly delineating the scope of the engagement in a written engagement letter. Spell out the tasks the lawyer has agreed to undertake and make clear that unless the scope of work is altered by agreement in writing, the lawyer is not responsible for any other tasks. The lawyer may also want to specify examples of the tasks for which he or she is not responsible, although admittedly this may be the last thing on a lawyer’s mind after winning a new client engagement;

(2) If the engagement letter provides for a formal method for documenting changes to the lawyer’s scope of work – and if the lawyer adheres to this practice during the course of the retention, the lawyer is more likely to be protected against after-the-fact assertions the lawyer was supposed to take on tasks not described.

Thus, in one case discussed by Shakman et al., which involved the lawyer’s role in assisting the municipality in a bond offering, the lawyer successfully defended the claim by relying on his engagement letter, which made clear that the retention did not include a review of the Phase I Environmental Site Assessment.

(3) At times there may be some activity that the lawyer might perform, in the interest of being exhaustive, but does not perform because the client did not want to incur the additional cost. However, if it turns out in hindsight  that relevant information was overlooked because of cost limitations, the lawyer will likely be blamed anyway. Again, “papering the file” is the best means for protection against Monday morning quarterbacking.   If the lawyer discussed with the client the pros and cons of expending additional time, and incurring significant fees, on potentially useful but discretionary discovery on investigation, that consultation – and the conclusion reached – should be confirmed in writing to the client.

In small to medium-size real estate transactions, there are countless instances where the client has been advised that it would be prudent to spend several thousand dollars to perform additional investigation to identify the presence of what might possibly be, for example, an old underground storage tanks on the subject property only for the practitioner to be instructed that the client that is well aware of the risk but does  not want to incur additional costs? 

Hopefully, all of those memos to the file  (in the early years) and emails (in the latter years) have been preserved against a future day when, at one or more of those sites, a nasty, leaking UST is uncovered and the client demands to know why the environmental lawyer didn’t undertake additional precautionary steps at the time.

All of the admonitions addressed to environmental lawyers apply equally to environmental consultants, who are also often unfairly taken to task for not performing work, or providing advice, outside their written scope of work.


Keeping Your Adversary’s Environmental Expert Honest

Law 360 reported on April 12, 2013 that Steven Donziger, counsel for the indigenous Ecuadorians known as the Lago Agrio plaintiffs, “meddled” in the preparation of a key environmental report used against Chevron as part of an effort to secure, by hook or by crook, the $19.2 billion judgment.

The environmental consultants at Stratus Consulting Inc. (“Stratus”) who prepared the report, Law 360 reported, found no credible scientific evidence linking Chevron’s operations in Ecuador to groundwater contamination, adverse health effects or an increase in the incidence of cancer. In fact, Stratus claims it was pressured by Donziger into making false public statements and concealing its role in drafting a purportedly “independent damages assessment.” The lead Stratus consultant stated, “I based my opinions and conclusions on a series of assumptions and data provided to me by Donziger and the [Ecuadorian plaintiffs’] representatives that I do not know to be true.”

In a press release, dated April 11, 2013, Stratus announced that Chevron had dismissed with prejudice the fraud and racketeering claims asserted against Stratus in the SDNY. According to the press release, Stratus’ environmental consulting work for Donziger was used in a report submitted to the Ecuadorian court by the supposedly “independent” court expert, Richard Cabrera, as part of a process that Stratus learned was “fatally tainted” by Donziger and the plaintiffs’ representatives “behind the scenes activities.”

 Most toxic tort cases do not have stakes anywhere near as high as Chevron’s Ecuador case. There is the danger in any high stakes litigation that an environmental consultant is pressured into offering baseless conclusions under pressure from plaintiffs’ counsel or, alternatively, that the consultant’s data is used improperly.

 There are steps that the diligent defense lawyer can take to reduce the likelihood of falling victim to expert witness fraud or abuse.

1. Obtain all the data. Well before the deposition of the plaintiffs’ expert, every piece of scientific data available should be obtained and reviewed. It may not be enough to rely upon reports submitted by the consultant to plaintiffs’ counsel or a regulatory agency. Often, the reports do not contain all the available information.

Where site investigation work is involved, it is good practice to obtain the consultant’s field notes so that defense counsel can investigate what on-site activities were performed on each day and by whom. If an issue in the case involves groundwater contamination, defense counsel should obtain the location, depth and construction details of each monitoring well, if detailed boring logs are not part of the report. The boring logs can provide important information concerning the observations of the staffers involved in the drilling, such as odors detected during drilling and soil composition.

2. Does the data permit the consultant to draw the conclusions made in his report? If there is a claim that groundwater contamination caused off-site impacts, for example, what assumptions were made in reaching this conclusion. Were on-site or off-site perimeter wells drilled? What does the data suggest about the presence of a groundwater plume? Was sufficient groundwater data obtained to permit reliable mapping of a plume? What assumptions does the consultant make concerning the size of the plume or the speed at which it is moving? Are these assumptions based on scientific evidence or guesswork?

Defense counsel should always be on the lookout for data that does not support the consultant’s conclusions. Does the consultant draw selectively upon certain pieces of data to support his thesis but ignore other data?

Often, an environmental consultant and a toxicologist are both retained to advance plaintiffs’ theory of the case.  Does the plaintiffs’ toxicology expert misapply the information generated by the environmental consultant? If the toxicologist alleges that plaintiffs were injured due to an inhalatory exposure, for example, evidence of elevated groundwater levels is not relevant in the absence of evidence that contaminants in groundwater reached the ambient air where they could be inhaled.

Similarly, evidence of groundwater contamination in a monitoring well may not be indicative of the quality of the water at plaintiffs’ tap. There may be data gaps that plaintiffs’ toxicologist will attempt to fill with mere speculation. Defense counsel must be prepared to exploit those gaps and reveal the fallacies in the expert’s presentation.