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Every attorney in private practice experiences the nightmare client that they knew they never should have agreed to represent. When dealing with nightmare clients, attorneys are usually
careful to document everything in writing including sending a disengagement letter. However, in their dealings with other types of clients, attorneys may not regularly send disengagement
letters or otherwise document the steps taken when terminating the representations. While the Rules of Professional Conduct do not require such notices, disengagement letters are a good
habit for attorneys to adopt in their practice.
Rule 1.16 of the Rules of Professional Conduct1 provides:
Upon termination of representation, a lawyer shall takes steps to the extent reasonably practicable to protect a client's interests, such as giving reasonable notice to the client,
allowing time for employment of other counsel, surrendering papers and property to which the client is entitled and refunding any advance payment of fee that has not been earned. The
lawyer may retain papers relating to the client to the extent permitted by other law, but must provide, upon request, the client's file to the client. The lawyer may reproduce and
retain copies of the client file at the lawyer's expense.
Rule 1.16(d) (Declining or terminating representation).
While the rule does not require written notice of the disengagement, a written disengagement letter can build good client relations for future employment when the attorney-client
relationship ends amicably. Additionally, if the attorney-client relationship ends on a bad note, a written disengagement letter gives the attorney documentation showing that the attorney
complied with the ethical requirements of Rule 1.16. A disengagement letter can also protect attorneys against malpractice claims if the client misses a statute of limitation or other
deadline after the attorney-client relationship ended. A disengagement letter can be particularly useful when an attorney has agreed to represent a client for a limited part of the
client's legal problem. For example, if an attorney only agrees to help with negotiating a settlement and does not agree to file an Answer to a Complaint or provide other services, the
limited scope of the representations can be confirmed in the disengagement letter.
Although a disengagement letter adds time to wrapping up a matter when the representation is terminated, the time and money expended to send a disengagement letter to the client is small
in comparison to the time and money needed to defend oneself against a malpractice claim or a Bar complaint. Please note that a disengagement letter is not meant to replace verbal notice
of the disengagement when there is an opportunity for verbal notice. Rather, it should serve as a written summary of what was discussed at the final consultation meeting.
Elements of a Disengagement Letter
1. Identify the matter that is the subject of the letter.
For example: "This letter will memorialize our recent discussions
concerning the termination of my representation of you in connection with your personal injury matter." If you represent the client on more than one legal matter, you may need to
address each matter and inform the client about the status of the case and the attorney-client relationship in each matter.
2. Affirm the current status of the case and remind the client of any pending deadlines.
If the case is closed, affirm that it is closed and identify any appeal deadlines
that may be applicable. If the matter is still pending, inform the client of the current status of the case and highlight any deadlines that may be pending. For example, you may need to
remind the client of a statute of limitations deadline or the need to have new counsel enter an appearance with the court within thirty days or they will need to proceed pro se. If you
previously discussed options for the client to consider on how to proceed, summarize the discussion in your letter.
3. Summarize the status of any fees and costs collected and outstanding.
In your letter, identify payments you have received to date from the client and state any fees or
costs still owed. Inform the client that you will shortly send them a statement for services rendered to the date of termination. If you have collected unearned fees, the unearned fees
must be returned timely since Rule 1.16(d) requires attorneys to return any advance payment of fees that have not been earned.2 If there is a dispute over what portion of the retainer or collected fees has been earned, pursuant to Rule 1.15, you must hold the disputed portion in your trust account, separate from your own funds, until the dispute is resolved.3
4. Reconfirm that your representation has concluded and outline what that means.
State when the representation ended or will end and confirm that you will
have no further obligations to advise the client on legal matters. Inform the client you will be closing the files on the case. If the matter is still pending, urge them to seek new
counsel if they have not already done so.
5. Suggest that the client keep copies of any documents you have sent them in the matter.
When the representation is terminated, Rule 1.16(d) requires the attorney to provide the file to the client upon request.4 Rule 1.16(d) also prohibits attorneys from charging clients for a copy of the file. When the subject matter of the representation has ended, suggest that the client keep copies of any documents you have given them during the representation for their records. If you are providing a copy of the file to the client, state you have done this in the letter. If the matter is still pending, state that you will transfer the file to the new lawyer, or to the client, and indicate you will need a letter acknowledging receipt of the file. You may also want to have a client sign a statement confirming the client received the file in case questions about the return of the file arise at a later date.
Often attorneys will ask whether they must still provide the client a copy of the file, at no charge, at the end of the attorney-relationship if they have been providing clients
copies of all documents as the attorney received them and generated them. Rule 1.16(d) states that an attorney's duty to protect the client's interest can include a duty to give the
client the file when the relationship terminates. However, Rule 1.16(d) is unclear as to whether the duty to provide the file free of charge can be fulfilled before the relationship
terminates, at least with regards to copies of documents in the file that have been given to the client during the representation. I recommend that attorneys not charge the client for a
copy of the file when it is requested after the representation ends. Even if the rule can be interpreted as having no requirement for an attorney to provide the client free copies of
documents already provided, it may be difficult to prove that you provided the information during the representation if you did not send cover letters with all of the documents as you
forwarded them to the client. Providing the copy without charge when the file is requested at the end of the representation promotes good will and may help you avoid the time and cost
required in defending yourself against a Bar complaint. However, this does not mean that the attorney is required to continue to fulfill multiple requests for copies of the file at no
cost.
6. Describe what measures you have taken to protect the client's interest when the matter is still pending.
If there is a discovery or other deadline pending
that needs to be continued to protect the client's interest and allow you to withdraw, state what steps you have taken to protect the client. For example: "I have arranged with
opposing counsel for an extension of the deadline for your response to the interrogatories to allow your new counsel to review your case and I have confirmed the stipulation for the
extension in my letter to opposing counsel dated January 5, 2004."
Conclusion
Most complaints that the Office of Professional Conduct receives originate from a
belief that an attorney is not adequately communicating with the client about the representation. Written disengagement letters are a simple practice which attorneys can adopt to promote
better communication with their clients and to protect themselves from malpractice claims and Bar complaints.
Footnotes
1. All rule references are to the Utah Rules of Professional Conduct unless otherwise indicated.
2.
An unearned fee could include an unearned retainer or a flat fee when the flat fee collected would be considered clearly excessive in light of the work performed pursuant to Rule 1.5(a).
3.
Rule 1.15(c): When in the course of representation a lawyer is in possession of property in which both the lawyer and another person claims interests, the property shall be kept separate by the lawyer until there is an accounting and severance of their interests. If a dispute arises concerning their respective interests, the portion in dispute shall be kept separate by the lawyer until the dispute is resolved.
4.
Generally, attorney work product documents are not considered part of the client file, but other documents provided to the client are part of the file. The comment to Rule 1.16 helps define which documents are considered part of the client's file.
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