One of the most common defenses to a lawsuit for professional fees is the threat of a counterclaim for malpractice. Irrespective of whether there is merit to such a counterclaim, the professional must still inform her malpractice carrier if such a counterclaim has been filed. In some cases, the professional must even report the threat of a malpractice action to his insurance carrier. We are very sensitive to this issue. That is why we contact the debtor to find out why he has not paid our professional client’s fees. We try to develop a sense of whether the debtor has a genuine issue with the services provided or whether the debtor is simply avoiding the debt.
Many times, we have counseled a professional to wait for the statute of limitations to pass on any potential malpractice counterclaim before filing suit. In Michigan, the statute of limitations for a malpractice claim is two years from the last date of service or six months from when the debtor discovered the malpractice claim, whichever is later. Other times, we counsel our clients to file a lawsuit right away, without waiting for the statute of limitations to expire.
We advise our professional clients that even after the statute of limitations for a malpractice counterclaim passes, a debtor may still file an affirmative defense of malpractice. However, as an affirmative defense, the value of the malpractice claim cannot exceed the value of the professional’s underlying claim in the case.