Andrew Andrus worked as an associate attorney in the 20-pers…

Andrew Andrus worked as an associate attorney in the 20-person law firm of King & Sevilla, L.L.P.  At the firm, Andrus handled large real estate transactions with limited supervision by senior partner Ken King.  Raymond Real Estate Partners (Raymond) was one of the clients that Andrus represented while working at King & Sevilla, L.L.P. One matter that Andrus handled for Raymond was the acquisition of a small shopping center. In connection with the purchase, Raymond transferred 1.5 million dollars to King & Sevilla’s L.L.P.’s trust account. Those funds represented the down payment for the acquisition of the center.  One month after the funds were transferred to the King & Sevilla, L.L.P trust account, Andrus advised Raymond’s President that Andrus was changing law firms.  At that point, the President asked Andrus for confirmation that the 1.5 million dollars in trust funds would be transferred to the new firm that Andrus was joining.  Andrus admitted to the President that in connection with his move to a new firm that the funds were transferred to a personal account that Andrus maintained at Champion Bank, not the King & Sevilla, L.L.P. trust account. Concerned about the transfer, the President asked Andrus to meet him at Champion Bank to immediately withdraw the funds. Suspecting “unseemliness”, the President asked the police to join the President at the meeting at Champion Bank.  When Andrus did not appear at the bank, the police and President went to the District Attorney to file charges. Without delay, Raymond’s President called Ken King to demand that the firm produce the 1.5 million that Raymond had transferred to the firm’s trust account. When the firm could not do so, Raymond filed a civil lawsuit accusing Andrus, King & Sevilla, L.L.P. and its partners of negligence, breach of contract, and misappropriation.  Among other allegations, Raymond asserts that the firm failed to maintain “adequate checks and controls over trust accounts to prevent diversion of funds by its employees.” The partners of King & Sevilla, L.L.P. are very concerned about Raymond’s claims because the firm only has one million dollars remaining under the firm’s legal malpractice insurance coverage (after using insurance proceeds to settle another malpractice claim). Raymond has personally named each firm partner as a defendant in the lawsuit. King & Sevilla, L.L.P, has hired you to serve as personal counsel for the firm and its partners. They have asked that you analyze the legal malpractice claims, defenses, insurance, and other related issues. In your discussion, identify any facts you need to provide an analysis of liability, as well as insurance issues.  Student response should not exceed 1,500 words. 

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