1. Essentials Of Business Law Chapter 30 Professionals’ Liability McGraw-Hill/Irwin Copyright © 2007 The McGraw-Hill Companies, Inc. All rights reserved.

2. Essentials of Business LawChapter 30-2 Professionals Person who performs work requiring special education, experience, and knowledge  Specialized work poses great risk of personal injury or financial loss to others  May need to pass a state-administered examination and gain accreditation, certification, or a license  Architects & engineers  Attorneys  Insurance agents & brokers  Health care providers  Accountants  Financial planners

3. Essentials of Business LawChapter 30-3 Malpractice A specific type of negligence lawsuit in which a professional is the defendant A professional’s improper or immoral conduct in the performance of duties  Carelessness  Lack of knowledge A claim of negligence must prove:  Duty  Breech  Proximate cause  Damages

4. Essentials of Business LawChapter 30-4 Liability Of Health-Care Providers Physicians, can be found negligent for failure to:  Render a correct diagnosis of a patient’s condition  Order appropriate tests  Prescribe appropriate medications  Render an accurate prognosis  Inform a patient of the risks involved in a particular treatment or surgery, or of other alternatives available Psychiatrists, can be found negligent for:  Not warning third parties if a patient intends to do harm to them

5. Essentials of Business LawChapter 30-5 Liability Of Health-Care Providers Nurses, can be found negligent for:  Incorrectly administering prescribed medications  Failure to properly monitor a patient’s condition Pharmacists, can be found negligent for:  Dispensing drugs other than those specifically prescribed  Incorrectly dispensing drugs that cause injury to the legal user  Dispensing multiple medications, that when taken together, cause injury

6. Essentials of Business LawChapter 30-6 Liability Of Accountants Liable to clients and third parties when they fail to:  Observe standards for their profession causing clients or third parties to suffer a loss  Discover or conceal evidence that a client’s employee has been embezzling funds  File appropriate and timely tax returns

7. Essentials of Business LawChapter 30-7 Liability Of Financial Planners Liable to their clients when the client relies on their recommendations and suffers a loss Churning  Excessive buying or selling of securities to generate commissions Unauthorized trading  Exceeding authority as agreed to by contract between the financial planner and the client Unsuitability  Recommendation of investments that conflict with the client’s particular situation, needs, and desires

8. Essentials of Business LawChapter 30-8 Liability Of Financial Planners Fraud or misrepresentation  Intentional or negligent misstatement or non- disclosure of a material fact relating to an investment Transfer of account problems  Deliberately obstructing the client’s desire to transfer one or more accounts to another professional Failure or delay in processing  Neglect in complying with the client’s wishes to purchase or sell securities in a timely fashion

9. Essentials of Business LawChapter 30-9 Liability Of Architects And Engineers Architects and engineers are liable if their negligence results in:  Injury to parties with whom they have contracted or to third parties

10. Essentials of Business LawChapter 30-10 Liability Of Attorneys An attorney is liable to a client if he or she fails to:  Exercise due care in handling a client’s affairs  Act in a timely fashion in filing claims  Properly investigate matters related to a client’s case

11. Essentials of Business LawChapter 30-11 Liability Of Insurance Agents And Brokers An insurance agent or broker is liable to a client if he or she:  Fails to recommend appropriate insurance and the buyer suffers a financial loss  Fails to recommend the right kind of insurance to protect against a specific type of loss  Fails to recommend appropriate amounts of coverage

12. Essentials of Business LawChapter 30-12 Reducing Professionals’ Risk Of Liability Liability insurance Attend training sessions to help reduce the risks that lead to negligent actions Continuing education