The Attorney-Client Relationship: the care and feeding of clients

What's the "golden rule" of good client practice? Never sue a client. Why? Because lawsuit equals bar complaint equals lost time and headaches. While I agree with Jay Foonberg's recommendation, let's face the truth though: sometimes the client deserves it.

While I don't advocate that you sue every single client for an unpaid legal bill, in this economy, it's necessary.So, if you're going to do it, you'd better "CYA" (cover your ass..ets).

First, get your agreement in writing. Too many attorneys have oral agreements, known as abstract understandings, regarding their client relationship. There's a reason we have written contracts and discuss contracts as a first-year law student. Quite simply, your contract is your lawsuit lifeline. Make your contract simple enough to understand, yet dense enough with the material and other information to protect you when the relationship turns sour.

Document, document, document. You're going to improve your chances of recovering your full bill, if you document everything. My line is, "if it's not in writing, it didn't happen." When you make a phone call to your client, opposing counsel, an insurance adjuster, a witness, document the conversation. Keep copies of the letters you send, with your signature.

I used to believe that the only the actual draft on the computer was necessary. An experience with a case taught me that the more documentation showing the event occurred, the better. If you can fax (with a confirmation), why mail. If you can email (with a confirmation), why fax. The point is, document the existence of the event.

More importantly, because your client will allege that you didn't fulfill your agreement, or the issue wasn't complex, or your bill was too high, you documentation will help prove up the extent of your efforts. Your notes and file will show that the client called you five-hundred times a week, and on Christmas, to complain about the other side's behavior. It's hard to dispute the complexity and reasonableness of the bill when the notes back it up.

Third, send regular, detailed bills. Clients freak out when they see your bill, every time. They're not going to tell you, but it happens. Sending frequent, detailed bills will smooth out their overreaction. You and I both know your bill is reasonable, and reflects the amount of work you did. The problem is, unless your bill actually shows how much work you've done, your client won't believe it. If you need more information on client bill, check out this post.

Finally, when you decide to sue the client, make sure your malpractice insurance is current. What, you don't have insurance!? Get it right now. It's the cheapest protection you'll ever have (mine costs $600 per year). You can't protect yourself for less. If you're going to sue clients, you're going to need some help defending those lawsuits.

You should never practice law without malpractice insurance. It's not fair to you, and it's not fair to your clients. Malpractice insurance is for the times that you actually screw up, and the client deserves some retribution for your mistakes. In that regard, be fair to your client. Be fair to yourself because you save yourself from potential personal liability and exposure for your negligent actions.

Hopefully you won't have to sue a client, but if you remember to CYA, you'll be in a stronger position to win.

UPDATE (12/16/2009): Ed Poll has a great article in Law Practice Today about suing clients. Some great information.