A client cannot make an informed decision about representation if that client is unaware that the lawyer may have committed malpractice. While we can foresee instances in which a client may well chose not to pursue a malpractice claim, a lawyer cannot decide this issue for a client through nondisclosure.
Disclosure is mandated.
Clearly, RPC 1.4 requires prompt disclosure in the interest of allowing the client to make informed decisions. Disclosure should therefore occur when the attorney ascertains malpractice may have occurred, even though no damage may yet have resulted.