(a) Establish the scope of the retainer
Everyone has been in a situation where someone expected them to do something, or they expected someone to do something, and as a result of miscommunication that “something” was not done. More often than not these oversights cause little harm, and are accepted with good grace. In most instances this acceptance is necessary because no one involved in the miscommunication was being held to a higher standard of conduct than the other. Fiduciary relationships, however, do impose a higher standard of conduct and the onus lies with the lawyer to guard against miscommunication and the potential harm that might flow from it. While it is true that lawyers are not required to confirm the scope of the retainer with their client in writing, it is always a best practice to do so, even if it is done by email. The scope of the retainer can, and should, also include services you will not be performing for your client. The burden of proving the scope of the retainer lies with the lawyer, and written confirmation of the retainer provides the best evidence of the parties’ intention.
The definition and rules regarding fee agreements are contained in Part 8 of the Legal Profession Act. If you are entering into a contingent fee agreement with a client, that agreement must be in writing and conform to the rules that govern contingent fee agreements (Legal Profession Act, ss. 64 – 68; Law Society Rules, Part 8). Bear in mind that a retainer agreement is about more than fees and disbursements; it should cover the essential aspects of the lawyer-client relationship, including your communication plan, legal strategy, scope of services, an authorization to act, and the roles of your client, opposing counsel, and you. Similarly, if you and the client agree at the outset that only a limited amount of work will be done you should have a limited scope retainer, as set out in rule 3.2-1.1 of the BC Code, or where it is a situation of short term or summary legal services. For example where summary services are being provided and there is insufficient time to do a complete check for conflict of interest. The limits of this relationship are described in rule 3.4-11.1 of the BC Code.
It is important that your clients understand that, in order to best serve their interests, you will have to communicate with the opposing party or his or her counsel. Explain this in your retainer letter. Eliminate the risk of your client perceiving your communications with the opposing side as unnecessary, or worse, improper.
In addition to safeguarding against future problems, having a written retainer provides the client with a document to refer to throughout the relationship. This may help you keep the relationship focused on the services you were contracted for. For example, you might have been retained to obtain default judgment, but your client might think that also includes the provision of legal services necessary to collect on the judgment. In such a situation, you can end up with an unhappy client even though you did your job well. A retainer letter is an ideal place to inform the client about the services you will not be providing. A retainer letter also allows you to set out some terms on which you may terminate the relationship.
Retainer letters are a useful tool for managing client expectations and documenting the intention of the lawyer and client regarding their contractual relationship. A good retainer letter establishes (amongst other things) the scope of services, how fees and disbursements will be charged, and ground rules for communication and termination of the relationship. By failing to confirm the retainer in writing, you introduce unnecessary risk into your practice. If circumstances change, such that it is necessary to revise the retainer, the first thing you should do is discuss the need for change with the client, and then confirm your new understanding in writing. Consider that every hour you spend trying to prove the existence or terms of a retainer, is an hour of your life you didn’t need to lose, and an hour that could be better spent engaged in more profitable or pleasurable pursuits.
(b) Confirm your decision to decline a retainer
Because the onus lies with the lawyer to prove the scope of a retainer, a moment’s reflection should make clear the value of sending non-engagement letters to people who sought your services, but with whom you have decided not to enter a retainer.
If you do not intend to accept a retainer, it is important to communicate your intention to the person who sought your services. Failing to do so may result in a situation where the person believes you are acting for them, even though you had no intention to do so. It should be obvious that such miscommunications create problems; including because a person who thinks you are taking steps to protect their rights would not be taking steps themselves to protect their rights, possibily resulting in lost rights through missed limitation periods, etc. You are setting yourself up for a complaint if you are not clear about your non-engagement.
Communicating that you do not intend to take the retainer is only part of the equation. It is essential that the person understand that a lawyer-client relationship has not been formed, and to know that while you are not advising them as to the potential merit of their situation, there might be limitations that affect their rights or obligations, and suggest they seek the advice of another lawyer. As mentioned, it is best practice to confirm your retainer, or non-engagement, in writing. The Law Society has a sample non-engagement letter available in their resources.