It isn’t uncommon for patients or clients to sue. Unjust as their claims may be, a litigious client will throw out the word “sue” as much as they are willing to write an online review. According to Rocket Lawyer, the chances of a small business owner getting sued is pretty high with over 100 million cases being filed every year.
Some business owners are under the assumption that a client who threatens them with legal action is just using it as a scare tactic or out of anger. After all, isn’t consulting a lawyer going to cost them more time and money than they can’t afford?
This is one of the more common misconceptions. A good deal of personal injury and other types of lawyers work on a contingency fee basis if they believe their client has a high chance of winning the case. This makes legal actions all the more attainable, even for those who are financially strapped. And statistically speaking, your more affluent clients are the ones you should be concerned with, anyway.
Because small business owners hold immense liability (no matter their practice), it is vital that you learn the signs of a potential litigious patient or client. It’s also practical to know the positive steps to take in order to stop someone from suing you and the overall appropriate method on how to handle a litigious patient. One wrong move can land you in a lawsuit that can cost you upwards of $100,000, according to the Court Statistics Project.
Here is some useful intel on how to spot a litigious client or risky patient.
Common Litigious Clients or Patients
The good news is, when it comes to clients who are likely to sue, you can usually see the writing on the wall. These people are typically troublesome from the beginning so that you know to start protecting yourself early on or you can dismantle the collaboration altogether.
Here are a few signs that point to litigious patients or clients:
They have Sued in the Past: Some people/patients are habitual troublemakers. If someone has sued a business owner or a doctor in the past, they have already gone through the legal process once and are fairly comfortable in pursuing the legal path again against your business. Once you suspect a potential trouble maker, it may be wise to check him in the National Litigation or Civil Litigation database. Even entities like the debt collection agencies often do this check before trying to recover debt from a client to protect their clients and them self.
They’re Affluent: Educated people and those with high paying jobs are more likely to sue than your Average Joe or Jane. The reason for this is because they have the resources to expand on these situations, or simply because they feel the need to have care without qualms because of their stature.
They’re Nit-Picky: Whether you are a doctor, a lawyer, a dentist, or some type of contractor, a client who seems unwilling to compromise may end up causing you bigger problems later on. Chances are, these clients are unlikely to be fully satisfied, meaning they’ll ask for extra work outside the scope of your contract or they will try to get a refund of some sort. When this fails to work in their favor (owing to the legality of your contract), they might claim “lawyer” and try to get their money back by means of a court date.
They’re Confrontational: Clients or patients that cause chaos in their wake are more likely to become litigious. According to Alston & Bird, some behavior of litigious people include:
- Complains about every aspect of their visit (forms, payments, long wait times, etc)
- Is demanding, rude, or hostile towards your staff members
- Challenges or criticizes your initial diagnosis with their own layperson research
Their Age and Healthcare History: In a study, it was reported that women ages 41-60 are the 39% more likely to file for a lawsuit. Those with an ongoing health history are also more likely to pull the trigger on court proceedings if they feel their service was not up to par.
How To Stop Someone From Suing You
Several measures may be taken in order to prevent someone from suing you. These methods should be implemented into your daily routine by both you and your staff. Anticipating litigious patients or clients from the start should play a role in putting together your Standard Operating Procedures. That way, you aren’t worried about the potential for this to happen on a daily basis because you’ll know that you’re already covered.
Here are a few preemptive methods you can take in order to stop someone from suing you:
Keep Records of Everything: This includes emails, phone calls, and in-person visits. You will want to install security cameras in your office space and sign up for a voice recording system to “ensure quality assurance.” These methods simultaneously work to prove your case should you be sued by a disgruntled client. It’s also important to follow up any phone calls with an email (a.k.a a paper trail) with the basis of your conversation that asks your client to confirm what was discussed.
Have an Arbitration Agreement: An ADR or an alternate dispute resolution is an agreement that states issues can only be resolved by means of an arbitrator. This disables the litigious person to seek legal action because they have already agreed in the contract to have resolutions made outside of court. In other words, having this clause in your contract makes clients give up their right to sue. An arbitrator will hear both sides of the issues to come to a binding decision.
Have insurance: Get a small business malpractice insurance or a medical malpractice insurance which covers your legal expenses and also covers the amount that you may be held liable in case the judgement is pronounced against your business and a compensation/penalty needs to be paid.
Sign Up for an LLC: If you’re not already, consider having your business established as an LLC. A Limited Liability Company ensures that only your business will be sued instead of you personally. Without it, your personal finances and assets are at stake in the event that you lose your case.
Have a Collection Agency handle your Accounts Receivable: Good collection agencies are insured against such events and they also run a “Litigious Debtor” scrub on accounts assigned to them.
How To Handle A Litigious Patient
If you haven’t already set up the aforementioned precautions, there are still measures you can take to handle a litigious patient. Here are a few methods on how you can handle a patient or client who seems like they may be aiming to sue:
Do Background Checks: If you have spotted any of the signs of a litigious client (affluent, confrontational, etc), you will probably want to do a background check on them before you proceed with your arrangement. Have they sued before? Have they made multiple claims against an insurance provider? Who have they previously worked with? This should be another preemptive measure, but knowing their history of complaints could help you out in the long run, if only to prove their tendency to seek compensation.
Try To Resolve Their Issue: Generally speaking, litigious clients will be complainers. To combat their desire to take you to court, try to ease their concerns outright. You can assure them of your services with statements from other clients, you can encourage them to get a second opinion, or you can slowly walk them through your strategies to explain your methods. The key is to keep them at ease and to have them trust you so that they know you have their best interests at heart.
If these clients seem beyond retribution, it might be best to cut off the arrangement before things get ugly.
Hire a Lawyer: And if worst comes to worst, hire a lawyer. Gather up all documents and communications you have with this specific client to help your lawyer design your defense. As a business owner, it’s your job to take precautions, but it will be your lawyer’s job to find loopholes in your arrangement. If you’ve been served by a litigious patient or client, stop all communication with them until you have a lawyer on your team.