There are many ways in which you can be held liable for a negligent referral. For instance, if an attorney negligently refers a case or client to another attorney, the attorney who made the referral may be held liable. That is why it is so important for attorneys and other professionals to conduct their own due diligence prior to referring their clients or cases to other professionals.
There is a duty to investigate the person to whom you are entrusting your client, and the same duty of due care applies to the fields of medicine, accounting, and real estate, to name a few.
You may be found liable for legal malpractice if you had an attorney-client relationship with the person whom you referred to the negligent attorney, though there may be cases in which even a non-client may hold an attorney liable for a negligent referral.
There are usually three different scenarios in which lawyers make referrals. One involves a referral by the referring attorney to the working attorney, who does all the legal work while the referring attorney receives no fee. Another type of referral is one in which the referring attorney does none of the work but still receives a referral fee. The third kind of referral is one in which both the referring attorney and referred attorney work on the case.
Usually, the only scenario in which you may avoid liability is the one in which the referring attorney receives no fee and performs no work on the case. This is because the referring attorney makes no assurances that the attorney to whom he or she referred the client would perform satisfactorily. However, even in this situation, the referring attorney is expected to exercise due care when referring a client to another attorney.
If you are a physician, you may be liable for medical malpractice if you knew or should have known that the doctor to whom you referred your patient was incompetent. You may also face liability if the clinic or medical facility to which you referred your patient was unaccredited, improperly staffed, or lacking in medical equipment. As in the case of lawyers, physicians are encouraged to inquire about other doctors’ qualifications prior to making a referral.
If you are a realtor, you may be liable for recommending a handyman to your clients if the handyman does a poor job of conducting home repairs for your client. Similarly, if you are an accountant, you may be held liable for recommending a financial manager whose performance is unacceptable to the client. All professionals have a duty to be diligent and cautious when making recommendations to their clients. Otherwise, they may face professional liability, malpractice, and violations of ethics.
If you are facing liability for making a negligent referral, you should consult an attorney.