|PUT IT IN WRITING|
Lawyers can help themselves and their clients by putting their agreements and advice in writing. Without documentation, clients can’t refresh their recollection of what was said and neither can the lawyers. In addition, a poorly documented file gives clients an advantage when filing a legal malpractice case or an ethics complaint. Below are some suggestions that can be helpful.
Fee Agreements and Engagement Letters
A written fee agreement and an engagement letter should be entered into with every new client. The engagement letter can be combined with the fee agreement or it can be sent separately after the client meeting.
The engagement letter sets out the scope of the lawyer’s employment with the client. It states what the lawyer will and will not do for the client. It may cover only the first portion of what the lawyer will do with a provision that the employment will be renegotiated at a certain point. This allows the lawyer to do initial preparation or investigation with a goal of re-evaluating their options at a certain point and deciding what is the most feasible direction for the client to pursue.
The fee agreement sets out the fee arrangement with the lawyer and outlines what the client must pay and when the payment needs to be made. If a flat fee is charged, this amount must be placed in the trust account until the fee is earned. If the lawyer is charging a non-refundable fee, it must be in writing and must state that it is a non-refundable fee. Even so, if the client fires the lawyer the next morning, it would be wise to refund the fee, exclusive of any earned amount. If the lawyer does not refund the unearned fee, the client is very likely to file an ethics complaint with the bar for an excessive fee.
In order to avoid the task of searching for clients to get permission to destroy their files after cases have been closed for 10 years, inform clients in the engagement letter that it is their responsibility to maintain their own files. Tell clients that they will be provided with copies of everything so they can maintain their own files. The engagement letter should state that the lawyer’s file will be destroyed after 10 years but clients can keep their files as long as they want. Give clients their own file folder and tell them to use it to keep all documents related to their cases. Provide the client with a file folder that already has the original engagement letter or fee agreement fastened down in the file and the lawyer’s business card stapled inside the file.
Whenever a lawyer talks with a prospective client and declines to accept the case, a non-engagement letter should be sent to the prospective client so he or she is not under the misconception that the lawyer has agreed to representation. This letter should apprise the prospective client that certain deadlines may need to be met and that it would be prudent to seek the representation of another lawyer if the prospective client wishes to pursue the matter.
If, after the initial interview, the lawyer does not hear back from the prospective client, the lawyer should send a non-engagement letter. In some instances, the lawyer will tell the client representation will not be undertaken until some other event takes place, e.g., documents are delivered to the lawyer or a retainer is paid. A follow-up non-engagement letter should be sent reminding the prospective client that the lawyer is not undertaking representation until the client sends the requested documents or money. This protects the lawyer from a prospective client’s perception that the lawyer has agreed to represent him or her.
If the attorney-client relationship is not working out well, the attorney needs to seriously consider withdrawing from the case. When this occurs, the lawyer should send a disengagement letter even if the lawyer met with or spoke with the client personally. Again, the letter should advise the client of any time deadlines and include a reminder of the need to seek other counsel if the matter is to be pursued.
Clients may fire the lawyer. The lawyer would be wise to send a disengagement letter to finalize the matter.
When taking on a new matter, be sure a thorough conflict of interest search is conducted. If a possible conflict shows up, determine if it is a likely or an actual conflict. If it is a likely conflict, make full disclosure, in writing, to all the parties. If the parties to the conflict do not object to the lawyer’s representation, they should waive the conflict in writing. The lawyer should also inform the client that if the likely conflict turns into an actual conflict, the lawyer must withdraw.
Of course, if there is an actual conflict, the lawyer cannot proceed to represent any of the parties.
During the handling of any legal matter, the lawyer should always send written confirmation of any instructions the client gives to the lawyer. Include any ramifications that might arise from the client’s instructions. This will protect the lawyer if clients later claim they did not mean what the lawyer thought they meant and did not realize what would happen when the lawyer followed their instructions.
Always send a letter to clients outlining the legal advice given. Set out all the possibilities, e.g., if you decide to go to trial, you could get more money or you could lose and receive nothing. Advise that if the matter goes to trial, the client will be responsible for all the trial costs, which could be substantial. Advise that if they decide to settle, they may get less money, but will not have as many trial costs and the lawyer’s fee will be less.
Outlining the client’s options allows the client to make an informed decision about the case and keeps the client involved in the direction of the case.
Once the matter is concluded, review the file and prepare it for closing. Return all of the client’s original documents to the client. When returning these documents thank the client for the business, advise the client of any final matters that need to be taken care of and confirm who is going to take care of these matters. This letter should again state that the client has her own file and can keep it for as long as she wants but that the lawyer will keep the file for 10 years and then destroy it.
Although it seems like a lot of letter writing and only done to 'CYA,' it is a better way to practice law. It ensures that clients are fully informed about their cases. A lawyer who takes the time to send proper letters projects a very professional appearance. It clarifies what is going on in the case and avoids misunderstandings that can lead to ethical complaints or malpractice claims.
ABOUT THE AUTHOR
If you would like more information on office systems, or help in setting them up, call Carol Wilson, Dee Crocker or Beverly Michaelis, practice management advisers at the Professional Liability Fund, (503) 639-6911 or (800) 452-1639.
© 2002 Carol Wilson