The Need for Comprehensive Fee Agreements and Engagement Letters
Contracts are made to be broken, and when they are broken, lawyers get involved. This is why in contract class in law school lawyers learn to advise clients why they need comprehensive agreements that address what happens in the event of a breach or termination.
August 31, 2017 at 04:57 PM
7 minute read
Contracts are made to be broken, and when they are broken, lawyers get involved. This is why in contract class in law school lawyers learn to advise clients why they need comprehensive agreements that address what happens in the event of a breach or termination. Not unlike their clients who don't draft wills because they somehow believe that they won't die if they don't have a will, lawyers never expect to be involved in contract disputes, particularly with their own clients.
Because they never expect to have a contract dispute with their clients, lawyers often ignore their own advice and enter into poorly drafted fee agreements. This point was emphasized to me while I edited the Pennsylvania Bar Institute's latest book, “Fee Agreements in Pennsylvania” (Sixth Edition), and discovered that even the most thorough and knowledgeable lawyers fail to include important provisions in their agreements and engagement letters. Or worse, they include provisions that are contrary to law or the Rules of Professional Conduct.
Having advised law firms for years about the need to have comprehensive fee agreements and engagement letters, I have seen what happens when lawyers simply photocopy the same agreement they used a decade ago, only to discover it does not address their current predicament. I have also testified as a witness in a Disciplinary Board proceeding in which an attorney was forced to defend why his fee agreement did not violate the rules when it contained a provision contrary to the Rules of Professional Conduct, to numerous court decisions, and to multiple professional guidance opinions.
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