The Elements of a Strong Account Malpractice Case

IRVING, TX, July 18, 2012

1. The accountant made a mistake. Just as an automobile driver can be liable if he or she makes a mistake driving a car, an accountant can be liable if he or she makes a mistake while representing a client. The accountant does not have to be a bad person, have evil intentions, or have violated an ethical rule of the profession. It is enough that the accountant erred. Of course, if an accountant was motivated by animus or greed the situation is even worse for the accountant.

2. The mistake must be one an ordinary accountant would not make. The question the judge asks a jury in an accountant malpractice case boils down to whether the accountant acted as an accountant of ordinary prudence. Some kinds of negligence are so obvious that a layperson can understand it was a mistake. But in most accountant malpractice cases, expert testimony from other accountants is necessary to inform the jury what the ordinary prudent accountant would have done. For this reason clients are often ill equipped to recognize and act on accountant malpractice. Consultation with a knowledgeable attorney may be the only way that a client learns he or she has been the victim of accountant malpractice.

3. The client suffered significant damage. In some areas of the law, violations of a duty trigger monetary penalties that may be unrelated to the damages caused by the violation. That is not generally true of accountant malpractice claims. An accountant may do something that subjects him to professional discipline, yet not have caused damages compensable in an accountant malpractice claim. Although an accountant may be subject to fee forfeiture in some cases, recovery of damages in accountant malpractice cases requires damages to the client that would not have occurred if the accountant had done his or her job correctly.

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