Running on Empty - The Need for Disengagement Letters
by Peter Pogue
Thursday, March 24, 2016
“Running on – running on empty
Running on – running blind
Running on – running into the sun
But I’m running behind”
Jackson Browne – 1977
Just as poetic as Jackson Browne’s lyrics from his hit song, attorneys who fail to write closing or disengagement letters at the conclusion of representation of a client are “running blind” and the statute of limitations may keep running. A prior PSIC blog post discussed the use of engagement letters to delineate the scope of representation of a client. Equally as important as outlining and managing expectations when entering into an attorney – client relationship is insuring that you terminate a relationship appropriately. Closing or disengagement letters serve not only to limit potential conflicts with clients by clearly communicating the terms of the conclusion of representation, but also to establish a date for the termination of a client relationship.
Often, the most salient piece of evidence in a malpractice or disciplinary action is the date that the attorney-client relationship was terminated. Without a definite termination date, the statute of limitations can effectively cease to begin running. Closing letters also transform current clients into former clients for the purposes of conflicts with other potential clients. A closing, or disengagement, letter should be written at the conclusion of each client matter, regardless of whether the lawyer receives numerous assignments from an insurance company or a single representation.
Courts have stated that “something inconsistent with the continuation of the relationship must transpire in order to end the relationship.” A properly drafted disengagement letter fits the bill. In drafting a closing letter, it is prudent to begin by reviewing your state’s applicable rules of professional conduct, as well as any local court rules, as some states and localities require specific timelines for unwinding from a relationship.
A closing letter following withdrawal from representation for an ongoing matter differs from a closing letter following termination of the attorney-client relationship after a matter has concluded. Again, seek the counsel of the applicable rules first, but the following are some items that should typically be addressed in a closing letter to a client in an ongoing matter:
- Provision to the client of a copy of the motion to withdraw
- Clear communication of any deadlines or the applicable statute of limitations, along with a discussion of the consequences of failing to comply with the deadlines or activities
- A reminder of the importance of seeking new counsel
- A discussion regarding any unpaid balances owed by the client
- Details regarding the retention, or return of, the client’s file
Several of the foregoing items are obviously not pertinent to a closing letter for a concluded matter. Whether a client’s matter has been resolved or is ongoing, it is imperative to effectively communicate that the representation of the client has been concluded. Using language of finality underscores the ending of the relationship and starts the running of the statute of limitations. Such language as “this concludes our representation of you in regards to this matter” implies finality. The firm’s document retention policy should also be set forth.
Remember, many clients may not understand the meaning of a closing letter. It is therefore ideal to communicate the issues set forth in the letter with the client orally prior to memorializing that conversation with the letter. Such a conversation will not only help the client to understand what the termination of the attorney-client relationship means, but will also increase the likelihood that a client will seek the attorney’s assistance down the road.
In addition to providing certainty and benefits to attorneys, disengagement letters should be crafted to serve as the final service to a client-letting them know that they can no longer depend on the attorney to safeguard their interests so that they can make alternative arrangements.