Two small things happen - or more frequently fail to happen - at the beginning and end of the attorney-client business relationship which can have an ethical and monetary impact on a lawyer and her firm that is out of all proportion to the time it would to do them properly. They are easily forgotten, discounted, or ignored until the day they come back to bite a barrister on her bottom. Even then the lesson is often quickly forgotten. Two things that cost a lawyer nothing to do, but may mean thousands in lost dollars if ignored: (1) writing a tight scope of engagement clause, and (2) sending an end-of-representation letter.
The Alpha: Writing a Scope of Representation Clause
There is no longer any excuse for not having a well-written scope of representation clause. The Colorado Rules of Professional Conduct compel a lawyer who has not regularly represented a client to communicate “the basis or rate of the fee and expenses . . . , in writing, before or within a reasonable time after commencing the representation.” Colo. RPC 1.5(b) (emphasis added). Further, “[a]ny changes in the basis or rate of the fee or expenses [must] also be promptly communicated to the client, in writing.” For better or worse, the day of the handshake engagement is over, and for an attorney seeking to contain her professional liability, it is for better.
Rule 1.2(c) provides the most powerful professional liability insurance policy against ever conceived, premium-free: “A lawyer may limit the scope or objectives, or both, of the representation if the limitation is reasonable under the circumstances and the client gives informed consent.” Since Rule 1.5(b) requires an engagement agreement to be in writing, how much more time could it take for a lawyer to sign up for this free insurance? Two minutes? Three minutes? Yet this gift granted by the Rules is largely ignored.
Lawyers routinely sweat the most minor contract clauses. I freely confess to scouring my documents for the proper use of “will” vs. “shall.” I have lost count of the articles I have read regarding whether “defend, indemnify, and hold harmless” is superstitious surplusage or absolutely essential to an effective indemnity clause. Do you belong to the “including, without limitation” school, or the “including, but not limited to” camp?
I continued to use the phrase “telefacsimile transmission” in my “multiple counterparts” clause for years because I found it more technically precise, long after fax machines had gone the way of the Dodo. We lawyers imagine ourselves to be shamans. We collect contract clauses and boilerplate and use them like spellbooks.
We brood over our favored legal incantations like the witches in Macbeth huddled around their caldron. “Eye of newt, and toe of frog, Wool of bat, tongue of dog . . . devise, bequeath, bequest . . . defend, indemnify, hold harmless . . . comes now the plaintiff . . . whereas, wherefore.” If we can just get the legal incantation right, we believe, it will have magical effect on the transaction, brief, or demand letter.
Yet when it comes to our own contracts, the ones that form the basis of our duties and obligations to our clients, we give them little or no thought at all. We delegate the drafting of engagement agreements to our legal assistants, which isn’t a bad thing since they probably give more thought and care to them than we do.
Instead of availing ourselves to the protection of Rule 1.2(c), we act as though we have never read it – sadly, many lawyers probably never have. If they had, they would never title a matter “general representation,” as was frequently done by lawyers in the early days of my firm. Lawyers are literally thoughtless when it comes to their own scope of engagement clauses. And that’s a shame, for as I wrote in The Rules of Unwritten Engagement, when you don’t write your own scope of engagement clause, the law will provide one for you.
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