The Unintended Client and Non-Engagement Letters

Every year, malpractice claims are made against lawyers by individuals that the attorneys never considered to be their clients. This occurs because the existence or non-existence of an attorney-client relationship is not explicitly communicated by the lawyer. 

Generally, courts will recognize an attorney-client relationship when the attorney's conduct would lead a reasonable person to believe they were being represented by the attorney. Parker v. Carnahan, 772 S.W.2d 151 (Tex.App. 1989). The evidence focuses on the conduct and communications of the attorney and putative client. 

Here, we’ll take a look at some of the scenarios in which an individual may claim to be represented by an attorney, even though the attorney has not agreed to provide legal representation. We’ll also clarify how a disengagement letter could support risk management for lawyers, and provide some sample non-engagement letter text you can use as part of your own practice management.
 

How Non-Client Confusion Arises

Claims by persons considered by the lawyers to be non-clients usually arise in one of the following three ways: 
 

The Lawyer Fails to Notify a Potential Client They Decline to Provide Legal Representation

There are certain occasions in which a lawyer declines to represent a person in a matter, and it is not clear to the prospective client that the lawyer is declining to represent him. This could happen with a new matter for a current client as well as for a prospective client. 
 
For example, in Rice v. Forestier, 415 S.W.2d 711 (Tex.App. 1967), a lawyer had represented a husband and wife and their corporation in various matters when the wife delivered to the lawyer a citation to answer a suit for the collection of a debt. No answer was filed and a default judgment was entered. The attorney admitted that the wife left the citation in his office with his secretary. The court held that the attorney had a duty to inform the client that he was not going to file an answer or defend the case. Although the lawyer had the right to decline to represent the client in this matter, he had an obligation to inform the client of this decision. 

In Rice, the client just dropped off the citation without further communication with the lawyer, assuming the lawyer would handle the matter. The same result could occur if a lawyer agrees to review a matter for a prospective or existing client and accepts the client's papers for review. Unless the lawyer specifically informs the client that he is not accepting the case, the client may claim that he relied on the lawyer's silence to mean that the lawyer was taking the case. 

A similar situation could occur in a transaction. A prospective or existing client might want a lawyer to review a residential real estate contract that is subject to review by the parties' attorneys within a certain number of days after acceptance. If the client delivers or faxes the contract to the lawyer without a clear understanding as to whether the lawyer is accepting the representation, the client may reasonably believe the lawyer is protecting his interests, and the lawyer may be liable for failing to do so. 

A non-engagement letter under these circumstances would prevent any misunderstanding about the absence of an attorney-client relationship. It might include the following language:

We have received [your communication]/[the documents you delivered] regarding [subject matter]. While we appreciate the confidence you have expressed in our firm, for various reasons we are unable to represent you in this matter. We are returning under cover of this letter the materials you provided for our review. 

When declining to accept a legal matter, lawyers should be careful in what they communicate to the client. Even if there is no question that the lawyer is not taking the case, the lawyer may still be liable to the prospective client for any legal advice or opinion rendered to the prospective client. 

In one case, a woman consulted with a lawyer about a  possible medical malpractice claim arising out of injuries to her husband while in a hospital. The lawyer met with her for about 45 minutes, after which time he told her that the case was not worth pursuing and that his firm would not represent her. The woman left, and did not consult another attorney for a year because she believed that she did not have a case based on the lawyer's remark. The jury found that there was an attorney-client relationship between the couple and the lawyer because the wife went to the lawyer for legal advice and he gave her an opinion about the merits of the claim. It also found that there was medical malpractice and that the couple would have been successful in prosecuting that claim but for the attorney's advice. The jury awarded damages to the husband of $610,500, and to the wife of $39,000. Togstad v. Vesely, Otto, Miller & Keefe, 291 N.W.2d 686 (Minn. 1980).
 
In another case, Miller v. Metzinger, 154 Cal.Rptr. 22 (Cal.App. 1979), the plaintiff's wrongful death case was dismissed for having been filed after the statute of limitations had run. The plaintiff had consulted four law firms. The Metzinger firm was the third. Metzinger ultimately declined to take the case, but a fact issue as to whether he informed the prospective client of his declination and that the statute of limitations was about to expire caused the appellate court to reverse summary judgment in favor of the lawyer. The court stated that even if the lawyer had withdrawn a few days before the statute expired, it would be a breach of duty to fail to inform the client of the statute of limitations issue and of the need to protect the case by filing within the prescribed time. 

Because courts have found a duty to inform the client of the requirement of filing within the statutory period, a non-engagement letter should address that issue, without necessarily giving an opinion about time limitations on filing. The non-engagement letter should include language similar to the following:

Please note that the law limits the time within which individuals may file lawsuits. Allowing too much time to pass may forever bar you from asserting your claim. We are not providing our opinion as to the date by which you must file any lawsuit against [adverse party]. We encourage you, however, to immediately contact another attorney if you wish to pursue your claim. 

The non-engagement letter should also include a disclaimer of any legal advice. For example, the letter might state:

In declining to take your case, we are not expressing an opinion about the merits of your position. We encourage you to consult with another attorney regarding your case if you so choose. Our decision not to accept this representation should not be interpreted as an adverse opinion about the merits of your case. 

 

The Lawyer is Representing a Group, But Not All Parties are Included in Representation

The second way in which these kinds of claims arise is when a lawyer is involved in a transaction involving multiple parties, some of whom are not represented by attorneys, and it is not clear to all involved which parties the lawyer does not represent. 

In Kotzur v. Kelly, 791 S.W.2d 254 (Tex. App. 1990), the court found that an attorney for a seller of real estate may be liable to the buyers when the circumstances lead the buyers to believe that the attorney is representing them and the lawyer has not made it clear that he was not their attorney. In that case, the client was selling 225 acres of land to his two sons. The sons did not retain another attorney, but believed that their father's attorney also represented them. When they later learned of a lien on the property, they sued the lawyer for malpractice. The sons testified that they thought the lawyer also represented them. The attorney apparently was unsure about whether he represented the sons and testified, "I didn't feel I was dealing with two different parties here," and admitted that he prepared the documents related to the transaction on a "family-type basis." The court reversed the summary judgment that had been entered in favor of the lawyer and remanded the case for trial. 

When dealing with unrepresented parties, especially when they are related to the client or are partners of the client, it is crucial to have something in writing that clarifies who the lawyer represents and who the lawyer does not represent. A letter to the unrepresented parties may contain language similar to the following:

 I enjoyed [meeting you]/ [talking with you] yesterday regarding [legal matter]. As I mentioned, I am only representing [client] in this matter. I am not representing you and cannot advise you regarding your interests in this matter. You should consider consulting with a lawyer of your choice. 

 

The Lawyer Does Not Notify an Existing Client of the Cessation of Their Legal Services

The third way in which claims by persons considered by the lawyers to be non-clients usually arise is when a lawyer terminates his representation, and it is not clear to the client that the lawyer's representation has ended. Generally, an attorney's liability for malpractice terminates when the relationship ends. In most cases, this occurs when the lawyer completes the client's objective. Maddox v. Burlingame, 205 Mich.App. 446 (1994). Sometimes, however, even though the lawyer considers the professional relationship to have ended, it is not clear to the client that the relationship is over. 

In In re Smith, 91 B.R. 612 (Bkrtcy.M.D.Fla.,1988), a bankruptcy court considered the issue of whether a lawyer continued to represent a client in a matter involving the release of a guarantee of certain debts of the client. The lawyer claimed that, at the time of the transaction, he was no longer representing that client. The lawyer had represented the client for over a decade. The court held that, once an attorney-client relationship exists, the attorney has the affirmative duty to notify the client of the termination of the relationship. Because there was nothing in the record indicating that the lawyer ever notified the client that the attorney-client relationship had been terminated, and because the client testified that he considered the lawyer to be his attorney, the court concluded that the lawyer had a continuing duty to the client.

In terms of malpractice avoidance, a "disengagement" letter to the client not only will serve to document the discharge of the lawyer's duty in the event of a dispute, but it should also signal to the client, in concrete terms, that the attorney-client relationship has ended. Consider sending a disengagement letter at the conclusion of each matter you undertake for a client. The letter might include language similar to the following:

We are pleased to have represented you for the past [time period] in [legal matter]. This will confirm that our engagement to represent you in this matter has concluded. We will take no further action regarding  this matter. We are returning to you under cover of this letter [documents] related to your case. 

Best Practices for Sending Non-Engagement Letters

• Follow up immediately. If you choose not to represent a prospective client after the initial consultation — or even after a phone call — reach out immediately to let them know you decline.
• Put everything in writing. A verbal disengagement is likely not enough to protect you if a lawsuit comes up down the road. Make sure non-engagement letters follow a clear template and communicate your disengagement without room for misinterpretation.
• Provide adequate information. Include the full name of the prospective client or clients you are declining to represent. Also include your firm name, the date of the initial consultation, and whether it was an in-person meeting or verbal conversation.
• Ensure letters are received. If possible, send disengagement letters via certified mail so you get return receipt confirmation they’ve been delivered. If emailing, make sure to include a read receipt.
• Offer a reason. Clearly outline your reasoning for declining to represent the person or persons involved. This could include a lack of expertise in the particular area involved in the case, or a conflict of interest.
• Keep a copy. Maintain both digital and hard copies of all non-engagement letters for your records. 
• Provide lawyer referral. Strongly suggest that the recipient seek other legal counsel, and if appropriate, offer a referral to a more suitable attorney.

Reduce Professional Liability and Uphold the Rules of Professional Conduct by Making Non-Engagement Letters Standard Operating Procedure