Rules of Engagement [Letters]

Protect yourself from misunderstandings that can turn into a malpractice claim.  Use client engagement letters to outline the terms and conditions of an attorney-client relationship.

Send the letter as soon as feasible after being retained.  Ideally, the letter should be prepared immediately after the initial interview.  The deeper you get into the matter, the more complicated and dangerous it becomes to change the scope of your work. Make sure you're covered with these engagement letter tips: 

• Identify the client.  State the client’s proper name and exact corporate wording.
• Thank the client for choosing your firm.
• Send an engagement letter not only to new clients, but also to existing clients with new cases.  For regular clients who provide a high volume of work, consider developing a short form letter.
• Send a letter for every case – no matter how small.
• Reiterate what you discussed with the client.
• Identify the type of case.  
• Indicate the court filing number.
• Specify what legal matters you have agreed to handle and what matters you have declined.
• Specify those aspects of the case that should be taken up with other professionals, such as accountants.
• Specify any limits or extensions on the attorney’s power to act (e.g., settlement requires client approval; power to sign contracts).
• Define the client’s responsibilities (e.g., the client must appear; the client must cooperate).
• State that you have performed a client conflicts check.  This will underscore the seriousness of conflicts of interest.  Your client might be more understanding if a conflict arises and you must withdraw.
• Identify other parties in the matter.  Enter this information in your conflicts database.  If the matter is in litigation, raise the possibility that additional parties might enter the case.  Point out that conflicts might arise with future parties.
• Explain your fee terms in plain English not legalese.  For hourly billing, specify rates for the supervising lawyer, associate, paralegal and staff.  For contingent fees, specify the percentages.  Indicate if court approval of fees is required.
• Explain the difference between fee and cost.  Describe what costs will be billed (telephone calls, postage, fax, courier, filing fees, travel, discovery, investigators, litigation support).
• Include costs particular to your practice area, such as appraisals in real estate transactions or expert witness fees in litigation.
• Explain your billing procedures – and stick to the specified billing cycle.  Explain minimum monthly increments, retainer amount, how the retainer will be spent, terms for handling unexpended retainer and interest charged on overdue accounts.
• If you have prepared a case budget, state the extent to which the budget is an estimate, subject to change as the case develops.
• Consider including a provision for arbitration of disputes over fees.
• Identify any other lawyers who will also work on the case.  Specify the primarily responsible attorney.
• If a matter, or portion of the matter, must be referred to another attorney, designate that person and delineate the respective responsibilities.
• Enclose relevant documents with the letter, such as:  Fee agreement, initial correspondence and medical releases.
• Give the client an overview of what to expect during the course of representation, including time estimates.  Include a chronology of the procedural steps for the case. 
• Indicate how and when you will withdraw from representation for nonpayment of fees, conflicts or other reasons.  Note:  Consult the Rules of Professional Conduct and the rules of practice for courts and administrative agencies to determine whether you can ethically withdraw and on what terms.
• Encourage the client to contact you with questions or problems as the case progresses.  Suggested language:  “We believe that candid communication between us will help serve you better.”
• Have the client sign the original of the engagement letter.
• Send the letter by certified mail, return receipt requested, so you have written proof of receipt.

For more tips and engagement letter samples, check out our Attorney-Client Agreements Toolkit