MARKETING MANAGEMENT TECHNOLOGY FINANCE
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• The amount involved and the results obtained
• The time limitations imposed by the client or the circumstances
• The nature and length of the client-attorney relationship
• The experience and reputation of the attorney
• Whether the fee is fixed or contingent
No single factor is determinative. The key to the reasonableness
of the fees provided for in the engagement letter is the client’s
understanding of the amounts charged and the reasons for the
fee structure. However, even if a client has provided his or her
informed consent in advance, a fee that is disproportionate to the
work performed will not be allowed and may form the basis for a
grievance and order of restitution.
STAFFING THE REPRESENTATION
The most productive relationships are based upon the client’s
trust and confidence in a particular attorney. Letting the client
know which attorneys will be representing him or her is therefore
important. However, circumstances and even the subject matter
of engagements regularly shift with time. As a result, while the
engagement letter should identify the attorneys the initial drafter
anticipates will be involved, the law firm should reserve the right
to appropriately staff the work to best represent the client.
CLIENT COMMUNICATIONS
The frequency and means by which the attorney will apprise the
client of the status of the proceedings should also be outlined in
the engagement letter. Model Rule 1. 4 requires that the client be
kept reasonably informed of the status of the
matter. While email has become a common means of communi-
cation, attorneys must caution their clients that no attorney-client
privilege will attach to substantive client-lawyer communications
made under circumstances where there is a significant risk that
the communications will be read by a third party. (ABA Comm.
on Ethics & Prof’l Responsibility, Formal Op. 459 (2011).)
CONFLICTS
If it is apparent that an actual or potential conflict of interest
exists, the manner in which the conflict is being addressed should
be set forth in the engagement letter. Keep in mind that not every
conflict can be waived and that the consequences of failing to
adequately analyze a conflict can be devastating to both the client
and the law firm. Assuming the existence of a conflict, the client’s
informed consent must be obtained for any waiver to be effective.
DOCUMENT AND FILE RETENTION
Given the obligation imposed upon attorneys to take affirmative
steps to ensure a litigation hold is in place and that data is preserved from the moment it becomes reasonably evident a dispute
exists, reference to the client’s role in the preservation obligation
should be spelled out upon engagement. While the details of the
client’s obligations should be outlined in a separate document
(and reiterated throughout the engagement), a cursory reference
to the need for the client to safeguard data and cease routine document destruction policies is warranted.
Finally, few jurisdictions delineate precise guidelines on how
long an attorney is obligated to maintain a file generated during
the course of representing a client. Outlining the attorney’s document retention policy in an engagement letter is the first step in
the process of advising the client that copies of the file will only
be held for a finite period. Again, the rules on retaining files vary
among jurisdictions, and attorneys must be sure to comply with
the local requirements.
CONCLUSION
There is no question that the administrative obligations placed
upon attorneys have increased exponentially over the years.
However, the time taken to draft a clear and unambiguous engagement letter will repay the attorney many times over by fostering
a good relationship with the client, increasing the likelihood of
prompt payment for services rendered and reducing the possibility of a malpractice claim or grievance. LP
BY MARIAN C. RICE
mrice@lbcclaw.com
Marian C. Rice is the chair of the Attorney Liability Practice Group at the New York law firm of L’Abbate
Balkan Colavita & Contini LLP, where she represents attorneys in professional liability matters and provides advice to attorneys on risk management and ethical issues. She is a member of the ABA Standing
Committee on Lawyer’s Professional Liability.
