Confirming Client Relationships Through Letters

Engagement Letter

Many malpractice cases arise from a failure to clearly identify the matter you are handling. Once you agree to represent a client, of utmost importance is executing an engagement letter establishing your duties and fees. A well-drafted engagement letter is the first step to good client relationships. The purpose of the engagement letter is to provide the client with written documentation of the services that you will provide. By setting forth the scope of engagement in your letter, you will better manage client expectations and avoid misunderstandings.

The Scope Of Engagement

Outline the work to be performed and approximate a timeline for the case. Inform the client that the legal process often takes a good deal of time. Provide a basic strategy to help the client understand the steps to be taken. Include any matters that are related but will not be handled to ensure that the client is aware that you are not representing them in these matters. Including non-engagement clauses in an engagement agreement assists with any negligence claim should it arise in the future.

If an attorney is entering into a limited representation, such as unbundled services, clearly indicate in the agreement who is responsible for which part of the representation. For more information, review our Unbundled Services handout available here.

Billing Procedures

Describe the billing procedure, including the frequency, detail and format of the bill. Best practices indicate monthly billing results in happier clients. If allowed, notify the client of the right to withdraw if fees are not timely paid. Estimate the fees and costs involved in the case in the agreement, such as filing fees and copying expenses. Knowing what charges to expect, in addition to time, will help them understand the cost of the case. A client blindsided by unexpected expenses will lose faith in their attorney.

Include in the billing description any additional persons for whom the client may expect to be charged costs. This includes expert witnesses and consultants. Also, inform the client of all personnel who will assist on their case and the fees associated with each. Understanding that work completed by an associate or paralegal ultimately reduces fees will be appreciated by the client.

Office Procedures

Use the retainer agreement to establish office procedures for returning phone calls and responding to emails. Find out how the client prefers to be contacted and be sure they understand the confidentiality issues related to each method of contact. Also inform the client of procedures when you are out of the office. Again, knowing in advance what to expect helps prevent the client from feeling neglected or abandoned if you aren't immediately available.

Review With Your Client

Review the retainer agreement thoroughly with your client. Answer any questions they may have about wording that is unfamiliar to them. Making sure the client understands the importance of the engagement letter will serve you well as the representation unfolds. Allow the agreement to be the client's reference tool to how they can expect to be treated by the firm. If they have it in writing from day one, they will typically be happy with the service you provide. Do not comment on the value of the client's case or make predictions about the success or failure of the case. This is a good place to discuss the potential problems so that the client isn't surprised later by road blocks.

If the client is responsible for certain tasks, such as providing documents or making decisions, provide a checklist for the actions to be taken and appropriate deadlines. This will help them understand their role in the relationship. Also, when they sign the agreement, they will feel as if they are joining a team and look forward to working together.

For sample engagement letters, please review the Attorney-Client Agreements handout located here

Non-engagement Letter

A common malpractice trap is when an individual contacts a lawyer to inquire about the status of their case and the lawyer doesn't have an attorney-client relationship with the individual. The attorney discovers that no file exists and many times the deadline to file (or otherwise handle their matter) has expired. In these instances, a non-engagement letter would be a life-saver. Non-engagement letters notify a potential client that no attorney-client relationship exists. These letters are sent in different scenarios such as when representation is declined after an initial interview, when strangers approach you at the court house with a legal question or when acquaintances seek advice in social settings.

A non-engagement letter should be courteous and thank the potential client for contacting you. You may or may not acknowledge the reason for declining the case. Without commenting on the merits, advise the client of the right to seek a second opinion and that time limitations may apply. Avoid providing further legal advice such as statements of liability or providing specific dates. Enter the names of all parties involved in the case into your conflicts database.

Non-engagement letters inform individuals that you are not their attorney and should be sufficient to protect you. It may seem like extra paperwork, but so would a grievance or malpractice claim when it is filed. Also, non-engagement letters serve as marketing tools, as the prospective client may later seek your assistance or refer you to a friend.

Dis-engagement Letter

A dis-engagement letter notifies a client that representation is being terminated or has concluded. State the reason for termination and that no further action will be taken. Alert the client to unresolved issues or possible time limitations.

Keep copies of dis-engagement letters in the file. This establishes the date upon which the statute of limitation begins to run. Upon expiration of the statute of limitation and statute of repose, malpractice claims are time barred. Courts, however, often side with the client in a dispute of when the relationship ended. A dis-engagement letter removes doubt and protects against client misinterpretations. Include the final bill with the dis-engagement letter, even if the balance is zero. Any refund due for unearned fees should be included as well. This allows you to settle the account in a timely manner. Clients are more likely to pay bills received immediately.

Return client property with the dis-engagement letter. Thank the client for the opportunity to serve them. For the repeat client, send a dis-engagement letter indicating that this case is concluded, and open subsequent cases with the appropriate engagement letter.