CLAIMS AGAINST TRANSLATORS What Are They And How Can They Be Prevented Mitigated Defended

Wilson, Elser, Moskowitz, Edelman & Dicker, LLP 150 E. 42nd Street New York, New York Martin M. Ween, Esq. Senior Partner

CLAIMS COUNSEL Professional Liability Insurance Program Provided by Underwriters at Lloyds’, through National Professional Group, to the Members of the American Translators Association

WHY IS IT IMPORTANT TO KNOW ABOUT DEALING WITH CLAIMS? n No matter what you do, there is always the possibility an error or omission may occur, which can lead to claims against you n Claims that are dealt with quicker and more efficiently make smaller problems n Claims can be problems to you, both on a business basis, as well as financially u disruption of business u time demands on staff u possible damage reputation

WHY IS IT IMPORTANT TO KNOW ABOUT CLAIMS? n The possibility of Claims being made against you is why you purchase insurance coverage for professional liability n It doesn’t matter whether you actually committed an error or omission - if a claim is asserted against you, steps must be taken to protect your interests n The nature and severity of Claims can impact on your future insurance coverage

IN WHAT WAYS CAN A TRANSLATOR BE HELD RESPONSIBLE? n Your services are performed pursuant to a contract; therefore, you will be held responsible for breach of that contract n A breach of contract will exist if: u the contract sets forth a duty or obligation u that duty or obligation is not performed, or not performed in accordance with the contract u damages are sustained by the other party to the contract as a result of the breach

WHAT IS THE STANDARD OF CARE FOR THE CONDUCT OF A TRANSLATOR? n In order to determine whether a duty or obligation has been breached, a “Standard of Care” will be used to judge the conduct of a Translator n As a Professional, the Translator will generally be held to the standard of “what a reasonable and prudent Translator in the same area would do under the same circumstances” EXCEPT

n Where your contract specifies another standard of care, such as IN WHAT WAYS CAN A TRANSLATOR BE HELD RESPONSIBLE? Professionals generally do not guarantee or warrant their work However, this is typical in purchase orders and other preprinted forms - read the back of these forms carefully! However, this is typical in purchase orders and other preprinted forms - read the back of these forms carefully! These purchase orders may operate to convert your professional services to merely providing a “good or product” These purchase orders may operate to convert your professional services to merely providing a “good or product” F Gross negligence or intentional misconduct F Strict liability, based on guarantees or warranties

WHAT TYPES OF CLAIMS CAN BE MADE AGAINST A TRANSLATOR? n Errors in the substance of the translated materials u use of the “wrong words”, that is, a failure to properly translate otherwise unambiguous language u use of difference nuances of meaning, such as where a word or phrase can have more than one reasonable translation, or the misinterpretation of idioms u grammatical errors, such as tenses or gender

WHAT TYPES OF CLAIMS CAN BE MADE AGAINST A TRANSLATOR? u Errors in “filling in the gaps”, that is, supplying missing or lost words, phrases, or terms u Ministerial errors, such as errors in computation, lists, or transposition of items u Failure to deliver the services, such as transcriptions, on time, or at all (CONT’D)

WHAT TYPE OF CLAIMS CAN BE MADE AGAINST A TRANSLATOR? u Conflicts of interest, breaches of confidentiality and inadvertent disclosure of information (CONT’D)

WHAT IS A “CLAIM”? n When do you know whether a “Claim” has been made against you and why is it important? n This involves both a legal and an insurance analysis n Most insurance policies require, as a condition to obtaining coverage, that you report “claims” to the insurer as soon as possible; a delay could therefore jeopardize any coverage you have for the claim n A delay in responding to a claim can also lead to greater problems, such as causing a lawsuit to be filed, or losing the opportunity to obtain an early resolution

WHAT IS A “CLAIM”? n However, a “Claim”, for purposes of insurance coverage, is not limited to a lawsuit - it can also be: u An oral or written demand for damages, or for services, based on an error or omission u An oral or written communication indicating an intention to hold you responsible for an error or omission, regardless of the validity of the assertion or the lack of a specific monetary demand (CONT’D)

WHAT IS A “CLAIM”? u An arbitration demand, or a request for mediation or other alternative dispute resolution procedure, based on an error or omission (your contract may specify a procedure to be followed for resolution of disputes) u A counterclaim against you in proceedings you institute, such as lawsuits to collect unpaid fees (CONT’D)

HOW CAN A CLAIM BE PREVENTED OR MITIGATED? n It may not be possible to prevent a claim from being made against you - a letter can be sent or a telephone call can be made and there is free access to the court system n However, there are ways to deter possible claimants and make claims less likely to be made, or less significant if asserted

WAYS TO PREVENT OR MITIGATE CLAIMS: CONTRACTUAL PROTECTIONS n The provisions of your contract can make your clients think twice before making a claim, or make it easier for you to defend and resolve a claim n Have a written contract, with all of the terms spelled out clearly n Have your contract form reviewed, if possible by an attorney with experience in the area n Utilize standard contract provisions developed by the ATA and other sources

WAYS TO PREVENT CLAIMS: CONTRACTUAL PROTECTIONS n Make sure your client understands the provisions and, by signing the contract, acknowledges that understanding n Clearly define the scope and nature of your work - what you are retained to do may be different from what your client thinks you should be doing and these differences often lead to claims n Put limiting and protective clauses in your contract, if possible, such as: (CONT’D)

WAYS TO PREVENT CLAIMS: CONTRACTUAL PROTECTIONS u a more limited standard of care, such as liability on your part only in the event of gross negligence, or willful misconduct u limitations on the amount of damages for which you can be responsible, such as the cost of the services, or some specific liquidated amount u no responsibility for “consequential damages”, such as lost future profits u The validity of contractual limitation clauses is a matter governed by state law, but many states uphold these provisions. (CONT’D)

WAYS TO PREVENT CLAIMS: CONTRACTUAL PROTECTIONS u Disclaimers and warnings can be added F deny any express or implied guaranty or warranty of accuracy F explain that the work, or any certification as to the work, is only an expression of professional opinion F state the criteria and methods to be utilized, such as stylistic changes, or the fact that the presence of different dialects may result in different meanings (CONT’D)

WAYS TO PREVENT CLAIMS: CONTRACTUAL PROTECTIONS WAYS TO PREVENT CLAIMS: CONTRACTUAL PROTECTIONS n However, contractual limitations cannot protect you from claims by third parties (CONT’D) u You may want to consider putting in your contract provisions for your client to indemnify, hold you harmless and defend you, in the event of a third party claim against you for your work u Avoid, or limit, to the extent possible, any indemnity, hold harmless and defense provisions running from you to your client

WAYS TO PREVENT CLAIMS: BUSINESS MANAGEMENT n Often, the successful avoidance or defense of claims depends on the existence and nature of the documents and information that are developed, maintained and available n “Make a paper trail”, that is, document everything you do, to the extent possible, including drafts, notes, etc. n Maintain your file for a reasonable period of time, such as the stature of limitations in your jurisdiction for breach of contract actions

WAYS TO PREVENT CLAIMS: BUSINESS MANAGEMENT n Properly research and verify the qualifications of your employees and independent contractors prior to and at the time of hiring, document your findings and maintain your records n Research and confirm the nature of your client and its needs - what are they, what do they want and when do they want it? (CONT’D) u Make sure there are no conflicts with your other clients and work

WAYS TO PREVENT CLAIMS: BUSINESS MANAGEMENT u Make sure your billing procedures and format are correct and comply with the client’s requirements - billing disputes often lead to claims (CONT’D) u Clearly indicate when your services are starting and when they are completed - this will avoid undue expectations on the part of the client

n Make sure you have appropriate and effective insurance coverage WAYS TO PREVENT CLAIMS: BUSINESS MANAGEMENT u sufficient limits of liability u a manageable deductible u covers the right persons and entities u remains in force, especially to the extent it is a “claims made” coverage u provides for a defense, as well as indemnity for damages

n If a Claim is made against you, report it immediately to your insurer - this will: DEFENDING CLAIMS: WHAT TO DO WHEN A CLAIM IS MADE u help to avoid issues of late notice, prejudice to the insurer and other coverage problems u allow the insurer an opportunity to investigate, appoint defense counsel and possibly resolve the matter at an early stage, if appropriate n Gather all documents and information about the claim as soon as possible, segregate and separately maintain them from other materials

n Avoid “self-help”, or direct contact with the claimant without the knowledge or consent of the insurer DEFENDING CLAIMS: WHAT TO DO WHEN A CLAIM IS MADE u this can create coverage problems u you may make statements that could make defense of the claim more difficult u even if the claim is within the deductible, if you report the claim, the insurer has a right to make sure that the claim is properly defended or resolved