A colleague, and sometimes respected adversary, recently published a short and informative, article discussing the perils of fee collection for attorneys which I think is helpful and informative.
What does an attorney do to avoid being the subject of a malpractice served as a defensive counter claim to an attorney's action to recover on an unpaid account?
There is no simple answer.
Beyond initial inquiry into the financial ability of a client when an initial engagement retainer is being prepared, and beyond being certain that a client is regularly and properly informed of the work as it is in progress there is no "fail-safe" mechanism to prevent the former clients from filing a counter claim allegation that the services rendered proximately caused the client pecuniary damage to the client.
The writer makes many time honored suggestions for the practitioner to keep in mind in the management of client account receivables. Each suggestion has a place to consider.
The suggestions are really trademarks of good client management and good business practice which are mandated - and necessary in the area where the "services" are often critical in commercial business decisions - but also these suggestions are very important to clients whose concerns are not in the commercial areas of the law.
Each class of clientele requires an attorney to provide not only competent legal services, but competent communication of what has been done for the client, and the time and costs to do so.
It is a process of communicating to the client what is being done, when it is being done, and the lawyer standing ready to be responsive to clients inquires as the work is in progress that will lessen the client's use of a counterclaim to a non payment action.
If an attorney regularly invoices a client for services rendered, but the client stands mute, the attorney has performed the critical communication link and prima facie established a right to payment under a theory of law recognized to be an "account stated" - but even good bookkeeping, and client communication is not a guarantee that issues of malpractice will not surface.
The article outlines some of the helpful hints so as to avoid defensive counterclaims. None are guarantees that defensive malpractice fee suits will not be filed and the article discusses the mandatory rules for fee collections being governed by mandatary fee dispute mediation and the differing statute of limitations provisions for a legal malpractice claim, (three years) as compared to the statute of limitations for te enforcement of a retainer contract ( six years).
Sometimes no matter what is done a client will be critical and/or complain and lest we forget, in some instance, when all else fails, "sue the lawyer" is the last drum heard when the smoke settles.
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