How Sharing Office Space with Other Attorneys Can Cost You More Than You Expected

You’ve been sued … by a client you never had … for damages in a case you never worked. You double-check your records. And nope – you’ve never met this person. So, why are they suing you?

Next, you’re refreshing your coffee and your colleague tells you he got sued … by the same person. The pieces start coming together. And you see what happened.

You and your colleague share an office with three other attorneys. One by one, you realize everyone in the office got sued. Here’s what happened.

One of your office mates has an upset client. And they’re suing everyone with a name on the door.

“But we’re separate law firms” you insist.

Yes, but you know how lawsuits go. Anyone can sue anyone for any reason at any time. And this happens when attorneys share office space. We know of an even more insidious case where the IRS got involved. But more on that in a minute.

Professional Liability Insurance underwriters know about this issue. So, you should expect some common questions about sharing when you apply for your insurance:

• Do you share office space?
• Do you share staff?
• Do you share cases?
• Do you share fees?

From a carrier’s perspective sharing muddies the water. It just makes the risk less desirable from an underwriting standpoint. Multiple law firms in a shared space can create the illusion of a partnership with the other firms or attorneys.

The Challenges of Shared Office Space

Obviously, a shared office space offers both collegiality and reduced expenses. But there are challenges that can ensnare you.

As mentioned above, it can create the illusion of a partnership with other attorneys or firms. And clients can allege claims against all attorneys in the shared office.

Some of the issues that can aggravate these situations are shared mail rooms, phone systems, and IT infrastructure. Client confidentiality is now in question. So, without rigorous processes, it is easier to create exposure to liability suits.

The IRS Can Cramp Your Style

An Alaskan lawyer went to work one day to find her office padlocked. She was in an office sharing arrangement and her officemate hadn’t been paying payroll tax payments. So, the IRS padlocked the doors.

There are many more office-share horror stories. They involve drunkenness, sexual harassment, and other debauchery. In one case an attorney discovered that his officemate wasn’t even admitted to the bar.

Wrapping Up

There are good and compelling reasons to share an office with various colleagues. But it does create exposure. Take reasonable steps to reduce your exposure. Of course, there are no guarantees that you won’t get sued. But plan for that eventuality and have a proactive rigorous response.

Discover more practical tips in Reducing Exposure from a Shared Office Space and Responding to a Suit.

More Resources: