After the oil rig blowout off the coast of Louisiana in 2010 which led to a litigation frenzy, practising attorneys paid runners millions of dollars to sign up tens of thousands of potential plaintiffs who were unaware of what their information was required for. The lawyers also filed unauthorised presentment forms on behalf of the alleged clients. It was held that such client solicitation does not constitute professional services and filing unauthorised forms was not performing “professional services for others” insured by the lawyers’ professional indemnity policy.
Although the policy covered claims “arising out of a failure to render professional services for others”, and “arising out” of simply requires a causal connection which is not necessarily direct or proximate, this client solicitation does not constitute professional services at all. Professional services are services for which professional training is required and the use of inherent skills typified by that profession, not all acts associated with the profession. The alleged solicitation mailings did not require the insured lawyers to use their specialised education or knowledge as a law firm or legal professionals.
The filing of unauthorised presentment forms was not work performed “for others”. The forms were filed without the knowledge or any pre-existing relationship with the alleged clients and there was a complete absence of authority to act for any of the alleged clients. The attorneys were acting in their own interests. To include unauthorised claims that are filed without the alleged clients’ knowledge or consent would construe the policy in a way that is unreasonable, inequitable and oppressive and absurd.
Coverage was denied.
The interpretation is a narrow one probably because the solicitation was unethical.