Demystifying ALIA: What Happens After a Report to ALIA?
Demystifying ALIA: What Happens After a Report to ALIA?
You have made a report to ALIA. So… now what?
This article originally appeared in Law Matters, the official publication of the Canadian Bar Association Alberta Branch.
Next steps will vary, depending on the unique circumstances of your reported claim (or potential claim). Regardless of the steps required, the good news is that you are in good hands. Your appointed Claims Counsel will reach out to guide you through the process, will be able to answer any questions you have, and will do their best to ease your mind along the way.
If the claim is potential, perhaps an abundance of caution report, Claims Counsel may simply obtain some additional details from you before placing the file in monitoring mode. In many cases, Claims Counsel will schedule a telephone call with you as a more efficient way of obtaining additional information and context from you regarding the circumstances that may develop into a claim against you in the future. If there is nothing to be done but wait to see whether a claim develops, Claims Counsel will follow up with you occasionally.
Likewise, Subscribers are obligated to report any updates to their assigned Claims Counsel in a timely way. The varying circumstances will dictate how long each potential claim ought to be monitored, before Claims Counsel proceeds with closing the file. Importantly, if a potential claim file is closed and a claim develops thereafter, the file can be re-opened and there is no compromise to your coverage as a result. If no claim ultimately arises, then (generally speaking) no costs or repairs/damages arise, so there is no deductible or surcharge incurred on the file.
On the opposite end of the spectrum, where a covered claim results in litigation, your Claims Counsel will retain defence counsel under a joint retainer. From there, if a waiver of defence can be obtained from plaintiff’s counsel, great, but otherwise defence counsel will ensure your statement of defence is filed straight away and then proceed with a more fulsome assessment of ALIA’s risk and your liability as well as any viable defences. Often, a call between the Subscriber, defence counsel and Claims Counsel will be scheduled at the outset to discuss file strategy including possible early resolution. Strategy calls are typically utilized throughout the litigation’s progression.
Pursuant to the Policy, ALIA has exclusive control of the defence. While a Subscriber’s cooperation is required (document production, questioning, etc.), a Subscriber can request to have as much, or as little, involvement as is possible. Some Subscribers prefer to be closely involved in the litigation strategy, whereas others request high-level updates only. If defence counsel is retained, the $5,000 individual deductible is payable, meaning the Subscriber is responsible for the first $5,000 paid out on the claim. If damages are ultimately paid out on a claim, the surcharge is then payable, which is a professional liability assessment in addition to the annual base levy. The surcharge is payable for five consecutive practice years.
In between those two extremes, you might be faced with a scenario where your former client has made a claim to ALIA, shy of filing/serving a statement of claim. In that case, Claims Counsel will work with you to determine whether the claim has any merit and whether to retain defence counsel or attempt to resolve the claim directly with the former client.
Another unique scenario is where there remains a distinct opportunity for particular steps to be taken to mitigate the claim or avoid it entirely (e.g. an application to strike a client’s action for long delay pursuant to rule 4.31 and/or 4.33). These scenarios are called “repairs” because successfully defending against this type of application means the underlying action can proceed and avoids the claim against the lawyer altogether. The decision to undertake a repair is within ALIA’s discretion, but it also requires the client’s consent and operates on a tripartite retainer. Occasionally, ALIA will initially hire defence counsel to assess the viability of a repair attempt. If counsel’s recommendation is to pursue a repair, and the client consents, counsel’s role can be switched over to repair. If the repair is not successful, and a claim develops against the lawyer, different counsel will be retained to defend the claim against the lawyer. Repairs trigger both the deductible and the surcharge. Your Claims Counsel is available to you to answer any questions you might have regarding these financial implications.
Being sued is an unnerving experience for anyone, but particularly so for lawyers who are accustomed to being involved in litigation, only in an entirely different way. Rest assured, ALIA will have your back. The role of Claims Counsel is to guide you through the process and assist in ensuring the best resolution of whatever scenario you are faced with. Do not hesitate to reach out to your assigned Claims Counsel with questions or concerns at any time throughout the process.
This is the third and final installment of a 3-part “Demystifying ALIA” series, the goal having been to clarify the ALIA process and the corresponding obligations of ALIA Subscribers. Take a look at the prior installments for more information.
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