Limited Liability Legal Practice: New Opportunities And Responsibilities For Illinois Lawyers

Illinois lawyers are now able to practice in law firms without being exposed to vicarious liability for malpractice committed by other lawyers in their firms. The Illinois Supreme Court recently promulgated rules, effective July 1, 2003, permitting lawyers to protect themselves against vicarious liability by organizing their firms under one of the statutory vehicles providing limited liability and by maintaining a specified minimum amount of malpractice insurance or other proof of financial responsibility.

The Court's action was taken in response to a petition filed by the Chicago Bar Association and Illinois State Bar Association proposing adoption of rules nearly identical to those that were ultimately approved. The authors of this article were privileged to help draft the petition and the proposed rules. Drawing on that experience, the authors describe the nature of the liability protection conferred by the new rules and explain the conditions that firms must satisfy to avail themselves of that protection. The authors also provide insight into some of the rules’ nuances, including relatively obscure provisions not directly related to limited liability.

This article first appeared in the April 2003 issue of the CBA Record, and is reprinted with permission from the Chicago Bar Association.