Don’t Sue Clients, and Other Thoughts for Young Lawyers on Building an Ethical Career
Ethics, Firm Management, Legal MalpracticeMost law schools offer a Legal Ethics class. Commonly, it’s taken in the third year of law school when most law students are busy with clinics, job searches, community service, Practice Court, capstone projects, or other activities that distract from learning professional responsibility. In fact, a third-year’s attention is most often drawn to ethics topics only when the student realizes that the bar exam isn’t the only exam one has to pass to be licensed in Texas. Passing the Multistate Professional Responsibility Exam is required to practice law in Texas, and it’s a right of passage for lawyers to joke, upon receiving a passing score, “now I’m unquestionably ethical!” Unfortunately, many young lawyers (and even many senior ones) manage to “step in it” with clients from time to time and land on the wrong end of a grievance or malpractice claim. In fact, in the 2022-2023 Texas State Bar year, more than 8,400 grievances were filed against Texas lawyers. If you are interested in the grievance process, TLIE published a two-part series here and here.
Hopefully this article will help newly-licensed lawyers avoid some of the most common actions that lead to grievances.
The American Bar Association identifies the five most common issues leading to complaints as:
- Neglect
- Lack of communication
- Misrepresentation/Dishonesty
- Scope of representation
- Fee disputes/Excessive fees
The suggestions in this article address one or more of each of those issues but will categorize them more generally: Talk to your client; Do what you say; and Don’t sue your client.
Talk To Your Client!
Okay, okay, the author isn’t a neanderthal–obviously “talk” to your client doesn’t mean you have to call or meet face to face to fulfill your responsibility here. It’s 2024 after all. Providing good client service means you communicate with your clients how and where they are, so yes, you can call, email, text, DM, carrier pigeon, or CM/RRR them. But you should follow a few simple guidelines when “talking” to your clients.
First, you must comply with TDRPC 1.03 which requires you to keep your client reasonably informed about their matter and respond promptly to reasonable requests for updates or other information about the matter. You must also explain things in a way that allows your client to make an informed decision, so, for example, if your client’s preferred and dominant language isn’t English, then communicate with them in the language they prefer.
Second, very clearly define the scope of your representation, in writing and with the client’s initials, and then state it again in an early communication from you to your client. A good scope might be, “represent client for all personal injury claims arising from crash occurring on February 26, 2024 in Dallas County, Texas involving client and Randy’s Big Rigs at the intersection of I-635 and Coit Road, up to and including trial on the merits.” A bad scope for the same client would be “represent client for personal injuries” because, among other reasons, you arguably just agreed to represent the client for any personal injuries to the client from her birth until whenever the Rule Against Perpetuities ends, or at least until the client’s death. Once you’ve got that signed contract, with the clearly defined scope, send a welcome email to the client that starts off with “thank you for the opportunity to represent you for all personal injury claims arising from crash occurring on February 26, 2024 in Dallas County, Texas involving client and Randy’s Big Rigs at the intersection of I-635 and Coit Road.” Your case management system may even help you auto generate the email!
Third, remember that the one communication from you that your clients will always read is your bill! Think of your bill as your monthly “newsletter” to your client. Less of the “receive and review” and more of the “receive communication from opposing counsel with proposals for para. 3 of the purchase/sale agreement; consider whether to accept or reject proposal to amend para 3 to exclude Billy the Goat from fixtures in the sale.” If that feels too Shakespearean and time-consuming, (a) it will never be as time consuming as a grievance, (b) ask AI to write a first draft of your entry, and (c) alternatively, consider adding a paragraph, or at least a few lines, at the end of your bill to give your client a written update on what happened that month. And yes, for you contingency lawyers, you too can send a monthly “bill,” which could include items like any advances the client received, any liens, expert fees, or anything else that may be deducted upon settlement, and a note about what went on in the case that month. In addition, consider including any important documents that arose in the matter that month, like, in litigation, your client’s motion for summary judgment or response, or in transactional work, the current draft of the deal documents, if appropriate.
Fourth, learn from doctors. Have you ever seen a doctor dictating notes from a patient consult or have the doctor enter notes into your chart while visiting with you? In the event of a later dispute, those notes are the gospel truth when it comes to what happened during that consult. You should have the same mentality–if it’s not written down, it didn’t happen. This means, for example, if you have a call with your client, send a follow-up email or text, like, “Thank you so much for taking time to visit about your real estate deal. It was a pleasure to talk to you about amending paragraph 3 to include Billy the Goat as a fixture, and I will propose that to the other party.” Then save that email or text in the client’s file.
Finally, your communication with your client doesn’t end the moment a settlement is disbursed or deal documents are signed. You should always send the client a formal “wrap up” letter that explains what you did for the client, based on the scope of representation in your engagement letter, and, if appropriate, how much it cost the client. The letter should gently end the representation; or, if the representation is ongoing, the letter can draw the client’s attention to the end of a project. This letter may be separate from your last bill, but your last bill can also include a note to the same effect.
Do What You Say!
Grievances often arise in this area when lawyers make promises they don’t keep, from the client’s perspective. For example, if you use the bad scope of work above, you are promising your client you will represent the client for all personal injury claims. If you turn down a slip and fall injury, in the client’s mind, you will have broken a promise. Along these same lines, don’t promise your client a specific outcome. Such a promise may be as benign as “I think we’ll get a good outcome” because, among other reasons, your client has a particular definition of “good outcome” that’s different from yours.
Lawyers should also set very clear expectations and boundaries with their clients. If you say to a client, “call me anytime, here’s my mobile number,” be prepared to respond to a midnight text storm from the client. One method to help establish good boundaries would be to include in your engagement letter the timeframe in which you respond to client communications. For example, your engagement letter could state, “I return phone calls and emails within 48 hours unless I am on vacation or handling an emergency.” You could also use the engagement letter to avoid the midnight text storm by establishing your working hours, like, “Our office is open from 8:30AM to 5:30PM Monday through Friday. After hours calls, texts, or emails will be responded to during open office hours.” You may also choose to gently remind your clients of these boundaries by restating them in an email signature line, for example.
Once you’ve established those boundaries, stick to them, because you can be sure that even if you forget them, your client won’t when you fail to return an email within 48 hours.
Don’t Sue Your Client!
Finally, don’t sue your client for unpaid fees. A legal malpractice claim may be a compulsory counterclaim against you in your lawsuit for fees against your client. You can be sure that, like the scrutiny with which your client reviews your bill, your client and her lawyer will scrutinize your representation to include any issues, big or small, that could support a legal malpractice claim against you. In addition to a counterclaim, you may draw the ire of your former client to take other retaliatory action like filing a grievance or leaving negative reviews.
Your insurance company may provide you a defense to the counterclaim which might save you on the costs of the litigation, but it cannot save you from being deposed, from the scrutinization of every detail of your service, or from the time and stress of being a party to litigation or from the time diverted from your practice and other aspects of life. If you intend to sue for fees, it is important to not only think about what you seek to recover, but be realistic about the likelihood the case will morph into a defense of you and your practice.
The defense of the malpractice claim will often cost more than the amount of unpaid fees in dispute. Frequently, as the litigation progresses, a lawyer will reach a point that they no longer even care about the fees and simply want the malpractice case to go away. Further, even if you obtain a favorable judgment, unless that client has assets that can be reached, they have already shown a refusal to pay. You are then potentially faced with embarking on the costs of collection.
Due to the high probability of a suit for unpaid fees turning into a malpractice claim against the lawyer, whether you have sued for fees in the past is a common question you will encounter on applications for professional liability insurance. Insurance companies know that an attorney who sues for fees is a higher risk. A suit for fees that requires involvement from your carrier for a defense may result in higher premiums and there are some policies that will even exclude coverage for a malpractice claim arising in response to a fee suit.
If you really feel the need to pursue your client in this way, you can use a collection agency instead of your own staff, but there are many restrictions and also possible ethical pitfalls, like disclosing too much confidential information to the collection agency. Tread lightly here.
The better practice is to make sure you collect the appropriate retainer up front, keep up with it and withdraw representation before the accounts receivables get higher than you feel comfortable writing off. This is particularly true if you are taking on a client who had previous attorneys who withdrew representation for nonpayment.
Welcome to lawyer life! Following these ideas won’t guarantee that you won’t get a grievance, nor does this article make that promise. However, implementing these suggestions may help you avoid a grievance, and will help you with evidence in the event one is filed against you.
