The practice of law is also a business. Attorneys have to attract and retain clients who pay their bills in order to keep the practice afloat. Sometimes, in the drive to retain new clients, attorneys ignore the warning signs that could indicate a problem down the road. Indeed, many attorneys who have had a dispute with a client will state after the fact that they should have known from the beginning that the representation would be trouble.
As a result, screening clients has become an increasingly important part of legal malpractice claim prevention. For some, it is difficult to turn down work just because of what could happen. However, over the course of a representation, problem clients can go from being risky relationships to legal malpractice claims in progress. The challenge is to screen out the problem clients without giving up on the clients attorneys need to survive.
Screening clients means different things for different lawyers, depending on the size, type, goals and location of a law practice. In the end, representation typically involves the exercise of an attorney’s judgment about whether to accept a new client. Because of that judgment, there is no formula for every decision regarding whether to accept a new client.
Here are some factors for attorneys to consider in deciding whether to take a new representation.
Ask the Right Questions
One of the most telling questions to ask a new client is: “How many attorneys have represented you in this matter before now?” If the client has been through several attorneys on the same matter, that could be a red flag. It could mean that the client is unrealistic, and has fired several attorneys for their inability to meet impossibly high expectations or to guarantee results. Those clients may be more likely to sue their attorneys for disappointing them.
Separately, a client who has been through several attorneys could be unable to pay their legal bills or could have been fired for other reasons that suggest the representation is fraught with risk to the attorney.
There are other similar common-sense questions. For example: “How many times have you been a party to litigation before?” This is obviously not a bright-line rule; large companies are frequently parties to litigation. Similarly, an entity or individual could be subject to several litigations arising from a single transaction or event. Such events would not necessarily indicate that the representation was excessively risky.
However, potential clients who have overly litigious histories might raise some red flags. This is especially true for potential clients who have made a career of suing other people for minor or perceived slights. Eventually, these serial plaintiffs can make their way to suing their attorneys.
When’s The Due Date?
The first due date for a new representation may be the filing of an Answer or an appellate brief. However, accepting a new representation at the “last minute” could set up a situation in which the attorney is ultimately held accountable for failing to execute a strategy in a limited window.
Representations that begin on the eve of expiration of the statute of limitation for a plaintiff’s claim, a scheduled closing for completion of a transaction or deal, or some other imminent deadline, are already facing an uphill battle. Unrealistic deadlines can be red flags.
Sometimes, there are good reasons a client is reaching out to an attorney to undertake a representation on the eve of a pressing deadline. But sometimes the reason a client needs an attorney at the very last minute could indicate a reason to have second thoughts about accepting the representation. This does not mean that an attorney should never accept a last-minute representation, but it is another factor to consider.
What’s the Payment Scheme?
Although this can be a delicate topic, an attorney can take time in explaining their fee to a new client to also ascertain whether the client is able to pay that fee. Nothing good comes from a representation when the attorney starts out with no realistic chance of getting paid. In such situations, the attorney may be assuming the risks of malpractice liability with no opportunity for compensation.
The Scope of the Representation
Many client relationships involve the management of expectations. At the outset, many attorneys find it valuable to inquire about the prospective client’s expectations for both the representation and the attorney. Sometimes clients expect an unrealistic outcome. They expect their attorney to achieve the impossible through whatever means are necessary.
Rarely do these representations end well. Instead, a candid conversation about what is possible, along with a description of what the attorney can and cannot do, is important.
If there are things the prospective client expects which the attorney is unable or unwilling to do, the attorney may have an ethical obligation to decline the representation. Relatedly, if a client expects their attorney to act as a magician to solve an intractable (or complicated) problem, and wants a guarantee of success, that client may be disappointed no matter the outcome. Such a client may be more likely to file suit against the attorney.
Conduct Background Research
The Internet provides cost-effective and fast tools for conducting some preliminary background research regarding prospective clients. Although this is not a necessary step, some simple Google searches may reflect a prospective client who has a history of problems that often extends to anyone and everyone around them. Alternatively, a litigation search might reflect a prospective client who has sued their attorneys before.
Use a System
Many things are required to open a new matter at most firms, including, most obviously, a conflicts check. Sometimes, when a new matter is being opened hurriedly, an attorney may be tempted to skip the firm’s administrative requirements to get the representation started.
Inevitably, it is the one prospective client who escapes the screening filters that creates the most problems. In fact, for some clients, it is their ability to convince others to abandon the rules and ignore the systems that makes them the most risky clients.
Shari L. Klevens is a partner at Dentons and serves on the firm’s US Board of Directors. She represents and advises lawyers and insurers on complex claims and is co-chair of Dentons’ global insurance sector team. Alanna Clair is a partner at Dentons and focuses on professional liability defense. Shari and Alanna are co-authors of “The Lawyer’s Handbook: Ethics Compliance and Claim Avoidance.”