Most of us love it when a plan comes together. California Realtors® have a lot to love about a plan that has come together on their behalf.
In the past month, the California Association of Realtors® (CAR) has announced both the creation of a "Defense Litigation and Claims Repository" and also the association's endorsement of an error's and omissions insurance carrier and broker. These two announcements represent the second and third parts of a plan designed to enhance the ability of California Realtors® to defend themselves in the ever-increasing litigious climate of the Golden State. The overall program, of which this three-part plan is one component, is known as CAR's Strategic Defense Program.
The first part of the plan was announced last year with the creation of the Defense Attorney Referral Panel. The panel, initially comprised of sixteen of the top broker defense attorneys from around the state, can be expected ultimately to grow to a group of 35 to 40 members. Members of the panel will be recommended counsel to CAR's 185,000+ members, and will provide services at discounted rates.
The creation of the Defense Attorney Referral Panel is not simply for the purpose of providing a list of recommended attorneys. Panel members are also acting collaboratively in order to raise the level and effectiveness of broker defense practice throughout the state. This is where the second part of the plan comes in, the Defense Litigation and Claims Repository.
Early in June, CAR announced the launch of its Defense Litigation and Claims Repository, a database that will be used and contributed to by members of the Attorney Referral Panel. The idea here is to build a knowledge base by pooling resources, so that panel members will have access to legal writings, briefs, strategies, and opinions that they will be able to apply to their current cases. Through it, for example, an attorney in Bakersfield might be able to learn of a defense strategy that worked in a similar case in San Diego. Or a defense attorney in Riverside might be able to learn that a plaintiff's expert witness had testified quite differently about the same issue during a trial in Orange.
The repository will also give participants the ability to analyze various types of claims, and, ultimately, to develop risk management strategies that can then be passed on to the brokerage community. Already, the panel response to the establishment of the Repository has been enthusiastic. No wonder. Its potential for enhancing defense work is enormous.
Establishment of the third component of the defense plan was announced a short time later. It consists in CAR naming an endorsed insurance broker and carrier of E&O insurance. The broker, Linsin, Sherman Associates, and the carrier, AIG-National are committed to working with CAR in its continuing development of a Strategic Defense Program. AIG-National has agreed that insured under its E&O policy will be provided defense by members of the attorney panel. Moreover, as the relationship develops, AIG-National, one of the largest E&O insurers with a substantial data base of its own, may become a contributor to the litigation and claims repository.
To the average practitioner, and the average consumer, E&O insurance and legal defenses are not what come to mind when one thinks of real estate transactions. But you can bet that brokers and owners of real estate companies think about them a lot. They represent a substantial part of the cost of doing business; and if not done right, they can spoil your day, or career.
In putting together this defense plan, the California Association of Realtors® has provided a significant service to its members. When you come to think about it, that's what a trade association is for.
How nice.
