The number of legal malpractice claims has levelled off in the last decade, but the expense it takes to defend the claims, settle them or pay judgments has jumped dramatically in the last few years, according to Randall Miller a partner with Sedgwick Detert Moran and Arnold in Los Angeles.

He told Wednesday?s Third Annual Hot Topics Seminar for the Bermuda Insurance Market the time when lawyers did not sue other lawyers became a thing of the past in the 1960s.

In the 1970s and 1980s the practice grew.

While the situation has levelled off in recent years, Mr. Miller said: ?The exposures are out there and require all of us to be on our toes in terms of what law firms and lawyers are facing these days.?

The most popular claims of late have been against personal injury lawyers, family lawyers and probate lawyers. There has also been a huge incidence of malicious prosecution claims.

?What we?re seeing is lawyers being sued for bad business advice,? Mr. Miller said, adding that it does not necessarily mean they committed malpractice, but could involve any business deal, such as an IPO, merger or sale of stock.

?Where a lawyer was involved in drafting a contract, they have potential exposure with the client or sometimes the third party claiming that the deal should have been structured differently,? he said.

He refers to these as ?sour grape claims? since they tend to come about well after a transaction is completed and only when a deal has gone bad.

?The first place a party looks to blame for the deal going bad is their lawyer,? he said. ?They will look at the transactional documents to see if there is anyway they can state a claim that says the lawyer should have done things differently.?

Such claims tend to be difficult to defend, he said.

They generally involve the parties reconstructing the entire underlying transaction, along with all of the negotiation, contractual documents and provisions and bringing in experts to discuss how things could have been done differently.

Legal malpractice claims are now a dime a dozen at Mr. Miller?s practice.

?We?ve seen enough that anytime a deal goes bad, the lawyer is usually one of the first people in the cross-hairs.?

Securities and tax cases are other big areas for claims with lawyers getting into trouble over the issuance of an opinion with respect to perhaps a prospectus for an IPO or in respect of tax work.

There has been a huge rise in malicious prosecution claims as well, he said.

?People don?t like getting sued,? Mr. Miller said, adding that when people are successful in their defence, they go after the other side for making them defend the initial lawsuit.

Dumb lawsuits filed by claims attorneys, which are not plausible and lack probable clause, are another reason for the rise in claims, he said.

Litigation settlement errors are also on the rise with clients who have agreed to a settlement turning around after the fact and claiming that the settlement was improper in some manner.

Classic trial errors are another area for claims, he said.

Two recent cases in California were brought on the grounds that the lawyer retained an expert who didn?t give favourable testimony and the underlying case allegedly was lost as a result.

Mr. Miller said that while 20 percent of his case load involves bankruptcy firms, conflict of interest issues are also another growing area for claims.

?The problem with conflict of interest claims is that juries love them,? he said. ?The one thing they understand is that somebody should not have two masters. It is a claim that resonates with jurors.?

He adds that a further 30 percent of his total cases are in some form of arbitration, which usually means the results are legally binding and cannot be appealed.

?You have to think long and hard when you?re underwriting an insured or dealing with a claim whether arbitration makes sense,? he said.