Solicitor and Client Costs - Essay Example

Solicitor and Client Costs Table of Contents Introduction 3 Circumstances of Termination of the Contract of Retainer 4 Implication on Costs Where a Solicitor Wrongfully Terminates a Retainer 6 6 Conclusion 7 References 8 Introduction The concerned case involves the Mr. Victor Wallender as the client who operates a plumbing business in the local area. The client had a legal solicitor from another firm for the previous two years and had to face several issues because of the avoidance and the reluctance of the assistant solicitor Miss. Phoebe Farmer to pay heed to his requirements. The issue faced by the client was that the assistant did not respond to the calls and avoided him. As a result of the avoidance, the solicitor failed to appeal to the Default Judgment regarding the debt recovery matter for Mr. Wallender, against the client who failed to pay the Central Heating cost. As a result, Mr. Wallender did not get justice and the case is still on-going primarily due to the indifferent actions by his assigned solicitor Miss Farmer. Furthermore, following a heated conversation with a senior partner at the place of his former solicitor, a letter was sent to Mr Wallender stating a large bill for the service provided to him along with sacking him as a client without any ultimatum. Thus, Miss Anna Stein has been appointed as a new solicitor for the business to deal with the legal issues and also to fight against the behaviour of the previous solicitor Miss Farmer. With these considerations, a breach in the contract of retainer between the client and the solicitor is evaluated in the study to understand the relevance of the agreement and its consequences. Circumstances of Termination of the Contract of Retainer The ‘contract of retainer’ is a treaty wherein the client and the solicitor agree to the business arrangement within themselves. It is an agreement between the two parties i.e. the client and the solicitor. A well cited retainer agreement has all the details regarding the rules and financial details in a written document. Moreover, the retainer contract must be written in English which is easily understandable by both the parties and must have the aspects such as the services attorney would provide, obligations of the client, fees, expenses and the method by which the relation between the client and the solicitor could be resolved. In this case, the solicitor following the ‘Attorney’s Code of Conduct’ enforces constraint to how and when they can withdraw from the case (Schlitt, 2010). The agreement is signed by both the parties before the commencement of the services. The agreement of retainer must be in the form of a written document wherein the costs will be specified. It is noticeable that the lawyer-client relationship can be terminated at any time by the client without cause. However, the solicitor in order to terminate the agreement has to take into consideration various facts such as the impact on the client due to the termination decision. The solicitor can terminate the contract after the work has been completed as documented in the retainer agreement (Contract Law (UK) Ltd, 2014). The event of termination is justified and the solicitor will be paid the fees if the client terminates and the solicitor terminates the client based on the justifiable cause. However, if the solicitor terminates or withdraws himself from the case without any justifiable cause then the solicitor is not liable for the contingency fees. Thus, the importance lies on what basis and under what circumstances the retainer is terminated to evaluate the liability of the parties in the contract (McLelan & Thomas, 2012). In this context, it can be discussed that the party which initiates the decision regarding the termination is not necessarily the reason for such action. For example, in Klein Lyons v. Walia, [2006] B.C.J. No. 570 case, the law stated that the action of termination was initiated by the client but the firm was the reason for such doing (McLelan & Thomas, 2012). The circumstances in which the contract of retainer can be terminated are several. However, the liability of the termination would depend on the situation for which the termination was caused and also based on the written agreement between the parties prior to the service delivered. In this case, Mr Wallender is not being able to clarify whether a written agreement was made between them. Besides, the heated argument which reflects a behavioural discrepancy can be a reason for such termination where the liability might lie on the client to pay the fees. Nonetheless, in this case, the solicitor did not work in a fair manner as she was avoiding the calls of the client as well as she missed on ascertaining the debt recovery for which Wallender was arguing. On this ground, the liability of paying the fees does not fall on the part of the client. Moreover, the solicitor himself withdrew from the case even before the case had terminated. In this scenario, the solicitor is not liable to get any due and leave the case of the client. The termination of retainer contract is not justifiable from the part of Miss Farmer as the reaction of the client is not unjustifiable under the prevailing circumstance. Additionally, one of the key conditions under which the termination is caused is when the client fails to pay the agreed amount in the contract. Due to the presence of conflict of interest between the parties which is not yet resolved, it might cause the termination of the contract. The other situation anticipated by rule 2.09 of the lawyers Rules of Professional Conduct or rule 3.08 of the Paralegal Rules of Conduct might lead to the termination of the services as well. In the given case, the termination by the solicitor is not justified, although there is a conflict of interest as the solicitor is avoiding the client and not keeping the client in the loop. Besides, the solicitor failed to file the debt recovery matter which was a key reason of interest for both (The Law Society of Upper Canada, 2013). Conversely, the solicitor can terminate the client who is not willing to pay the fees, keeping in view the documented contract of retainer as a proof of the agreement. In relation to the termination of retainer contract, a case is cited of, Richard Buxton (Solicitors) v Mills-Owen (the Law Society intervening) [2010] EWHC Civ 122. The appellant terminated the retainer as they argued that the solicitor did not follow the commands as they presented the advanced point. On this basis, the decision or ground of termination was not reasonable and thus the appellants were permitted to leverage their profit costs and payments up to the date of termination. Therefore, it is important to evaluate the reason for the termination and the consequences in terms of the cost entitled (The Solicitors Group, 2010). Implication on Costs Where a Solicitor Wrongfully Terminates a Retainer The retainer agreement is a written document with the cost specified as a subject of fees and other cost charges in case of termination of the contract. It is observed that the dispute amid the solicitor and the client is based on the cost incurred when the party wrongly voids the contract. The cost stated entails the hourly rate fees, fixed fees and the Conditional Fees Agreement (CFA). With regard to the case, if the client has a Conditional Fees Agreement then the client i.e. Mr Wallender is not liable to pay the solicitor. Moreover, the cost that is claimed is the disbursement cost. Also, a range of cost is estimated if the client wins the on-going case and also if the client loses the case. Besides, if the solicitor wrongfully terminates the retainer before completing the contract, he is not liable to get further fees and conversely needs to pay the fees already received for the given case (Baksi, 2012). Considering the concerned case, it can be evaluated that the solicitor must pay the fees received by them in relation to the given case. As the solicitor wrongfully terminates the client, he is no more liable for any fees but needs to bear the default cost of the client. Whereas, if the solicitor terminates the retainer and holds the documents of the client which is necessary for further proceedings then the client needs to bear the cost of the solicitor’s unpaid fees in order to gather the required documents (Stephen Warne, 2011). Furthermore, if the solicitor terminates the contract in the middle of the proceedings then the solicitor will be liable to pay the cost of assessment based on the one-fifth rule (Hancy, 2011). Conclusion The solicitor and client relation is documented through a contract with complete details associated with the fees and the payment structures inherent within the case. Correspondingly, it is observed that the solicitor withdrew from the case due to the argumentative behaviour of the client which can be said to have been prompted by the lack of action taken by the solicitor. With reference to the relevant laws, it is affirmed that as the solicitor had no justified reason to terminate the contract without prior intimation, the solicitor is liable to bear the default cost of the client and get no fee payment. The only problem with the client and the new solicitor is that the client has no documents organised and does not even remember whether there was a written contract of retainer with the previous solicitor. Nonetheless, in keeping with the discussion made in the case, it is observed that the client has no liability as the solicitor has sacked the client and left the on-going case without any enumerated consideration. References Baksi, C., 2012. Appeal Court Backs Law Firm In ‘You’re Fired’ Retainer Row. The Law Society Gazette. [Online] Available at: http://www.lawgazette.co.uk/65447.article [Accessed February 02, 2014]. Contract Law (UK) Ltd., 2014. The Retainer: Your Agreement With Your Solicitor. Contract Law. [Online] Available at: http://www.contactlaw.co.uk/the-retainer-agreement-your-solicitor.html [Accessed February 02, 2014]. Hancy, G.R., 2011. Where It Can Go Wrong For Lawyers – Professional Responsibilities And Liabilities. Property Law 2011, pp. 2-15. McLelan, T. & Thomas, E.A., 2012. What Happens when a Client Changes Lawyers or a Lawyer Changes Firms? Personal Injury Conference—2012, pp.2-18. Schlitt, C.L., 2010. What is a Retainer Agreement? New York Law Thoughts. [Online] Available at: http://nylawthoughts.com/2010/05/13/retainer-agreement/ [Accessed February 02, 2014]. Stephen Warne., 2011. Stephen Warne on professional negligence, regulation and discipline around the world. About. [Online] Available at: http://lawyerslawyer.net/2011/06/12/qld-solicitors-referred-to-legal-services-commissioner-for-demanding-outrageous-sum-as-condition-for-handing-over-file-on-their-wrongful-termination-of-no-win-no-fee-retainer/ [Accessed February 02, 2014]. The Law Society of Upper Canada., 2013. Terms of Withdrawal in Retainer or Engagement Letter. For Lawyers. [Online] Available at: http://www.lsuc.on.ca/TermsOfWithdrawalInRetainerOrEngagementLetter/ [Accessed February 02, 2014]. The Solicitors Group, 2010. Termination of Retainer. Articles, pp. 1-3. Read More