Ralph Adams 2012-12-12 01:09:10
As all lawyers know, when it comes to legal malpractice and bar complaints, the goal is minimizing the risk. There are three letters you need to make a regular part of your practice, that are all about minimizing that risk. 1. Engagement Letter The first is commonly referred to as an “engagement letter”. The purpose of this letter is to prevent misunderstandings between lawyer and client about the scope of the representation, which might lead to a legal malpractice claim or bar complaint. ER 1.5(b) requires that a lawyer “communicate the scope of the representation and the basis or rate of the fee and expenses…in writing…before or within a reasonable time after commencing the representation….” There is an exception where the lawyer will regularly represent the client on the same basis or rate. The “writing” can take many forms: an engagement letter is only one. In general, the more detailed and more clear the letter is, the better. At a minimum you should include the specific identity of the client, the scope of the representation, a clear discussion of the fee to be charged and where the client’s money will go (trust or operating account). Of course, where the matter involves a contingency fee, the client must also sign the writing. 2. Declination Letter Whether you intend it or not, an attorney/client relationship can begin based upon the reasonable belief of the client. Matter of Pappas, 768 P.2d 1161, 159 Ariz. 516 (Ariz. 1988) (“The existence of an attorney-client relationship depends largely on the client’s “belief that it exists.” (citing Louisiana State Bar Ass’n v. Bosworth, 481 So.2d 567 (La.1986)). One very effective tool in eliminating that possibility is a “non-engagement” or “declination” letter. This letter should notify a person who may, for whatever reason, mistakenly believe that you represent them when in fact you do not. You should also consider sending these letters to unrepresented non-clients in a situation where there are multiple parties to the transaction and you represent one or more, but not all. 3. Termination Letter The third letter is the “termination” or “closing” letter. Once a client matter has ended many lawyers simply close the file. Among the many reasons for sending closing letters is clearly establishing the date the representation ended. This can be important for conflict analysis purposes, where the lawyer seeks to represent others who are perhaps adverse to the first client. Second, the letter should address any outstanding balance and file retention. Third, it is just good business to thank the client for the opportunity to represent them and offer availability for future representation if the need should arise. The letters discussed here don’t really take that much time or effort. They can, however, save you countless hours, headaches and dollars. In short, each one is well worth the effort.
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