Engaging Your Client
February 11th, 2010
The Use of Engagement Letters
By Folarin R. A. Williams
Presented at the 3rd Business Law Conference of the NBA Section on Business Law.
It is strange that as Lawyers we draft contracts, go to court on behalf of Clients to interprete contracts, yet in this jurisdiction as in several others, very few of us use ‘engagement letters’.
We advise our clients to put everything in writing in their business dealings, yet we, as lawyers fail to do so. We continue to be Law firms, not businesses. We complain Clients never pay, or never pay on time, Clients complain that receiving a lawyer’s bill is enough to give a coronary episode.
The time has come when all Lawyers must be required to give a written agreement to each Client to show the basis on which they undertake work. It protects us and it protects the Client.
Advantages of an Engagement Letter
* It compels client and lawyer to focus on what each side hopes to achieve and how – scope, cost, and the likely effect of service
* It establishes trust between lawyer and client
* It eliminates misunderstanding
* It specifies basis for fee computation
* It clearly identifies client, preventing future conflict of interest issues
* It sets out responsibilities and obligations in pro bono matters.
Pragmatically, legal fees are always connected with profitability, the business side of the law.
Checklist for Engagement Letters
1. Parties
2. Scope of Engagement
3. Nature of Services- Course of representation (optional)
4. Lawyers and Others providing Services
5. Communicating with the Responsible Lawyer
6. Methods of Communication – Preserving confidences (optional)
7. Clients’ obligations
a. Fee arrangement
b. Disbursement arrangement
8. Billing Arrangement
9. Dispute Resolution
10. Right of withdrawal
11. Additional requirements of State Law or Rules of Court (optional)
12. Agreement (countersignature of Client)
Non-Engagement Letters
A prospective client may attempt to brief you, and either for conflict of interest reasons, or some other reason, you are unable to accept the matter. It is wise to write a non-engagement letter to clarify the position.
Disengagement Letters
Where an Attorney is no longer representing a Client, it is also important to set out in writing that this is the case, and a disengagement letter is important.
Money Laundering Considerations
The Money Laundering Act has implications for our profession. Representations relating thereto are now being included in engagement letters emanating from other Common Law jurisdictions.