Perfecting Your Fee Agreement So It Protects You

WEBVTT
00:00:03.120 --> 00:00:07.719
Hi there. Welcome to this great and important
00:00:07.719 --> 00:00:11.380
for all of us webinar today. My name is Dean
00:00:11.380 --> 00:00:14.259
Serwin. I'm the chair of the wellness section
00:00:14.259 --> 00:00:16.219
here at the Beverly Hills Bar. And I was formerly
00:00:16.219 --> 00:00:18.379
the chair of the law practice management section
00:00:18.379 --> 00:00:21.600
who's presenting this important program. I'm
00:00:21.600 --> 00:00:23.000
going to give you a little background and then
00:00:23.000 --> 00:00:27.679
we'll jump in with Marshall Cole. So it's that
00:00:27.679 --> 00:00:30.989
time of year and it's that time of the three
00:00:30.989 --> 00:00:35.189
year for myself, I get to do my compliance, my
00:00:35.189 --> 00:00:39.530
MCLE compliance. The Beverly Hills Bar is fantastic
00:00:39.530 --> 00:00:42.030
for helping out with that. We have these programs.
00:00:42.170 --> 00:00:44.149
This is the second one I've introduced today.
00:00:44.329 --> 00:00:46.109
I'm sure there's gonna be another one at four
00:00:46.109 --> 00:00:49.030
o 'clock today. We have one to three of these
00:00:49.030 --> 00:00:54.810
a day. They're all available in the BHBA on demand.
00:00:55.039 --> 00:00:58.840
locker room, sort of a YouTube for MCLE that
00:00:58.840 --> 00:01:02.759
we do. If you're like me and in the past you
00:01:02.759 --> 00:01:06.219
needed a few extra hours, you'd click on one
00:01:06.219 --> 00:01:09.480
of those emails or back in the day faxes that
00:01:09.480 --> 00:01:13.859
would come in offering you all 25 hours for $75
00:01:13.859 --> 00:01:18.120
and the programs you'd get on back then VHS and
00:01:18.120 --> 00:01:21.930
then DVDs were awful. They were old, they were
00:01:21.930 --> 00:01:24.810
poorly produced, they were boring topics done
00:01:24.810 --> 00:01:29.549
by very professorial speakers that were hard
00:01:29.549 --> 00:01:34.969
to follow. BHBA, we've got programs like today's,
00:01:35.129 --> 00:01:37.329
important things that are important to your practice.
00:01:38.250 --> 00:01:40.629
If there's a new case that comes down or important
00:01:40.629 --> 00:01:42.629
legislation or just something important that
00:01:42.629 --> 00:01:45.569
happens in the business or legal world, we're
00:01:45.569 --> 00:01:46.989
probably going to have a program on it within
00:01:46.989 --> 00:01:49.719
a week. That program is then going to be in the
00:01:49.719 --> 00:01:52.359
on -demand locker room. I know it's not called
00:01:52.359 --> 00:01:54.700
that, but I like calling it that, where you can
00:01:54.700 --> 00:01:58.299
go and watch it again. After today, you want
00:01:58.299 --> 00:02:00.980
to review this, you can go and review it. You
00:02:00.980 --> 00:02:03.379
can send it to your partners, your associates,
00:02:03.500 --> 00:02:07.680
your friends and say, hey, go check this out.
00:02:08.419 --> 00:02:10.939
It's really fantastic. Then when it comes time,
00:02:11.060 --> 00:02:13.699
like it is for me, I guess we get an extension
00:02:13.699 --> 00:02:17.770
of a month now, to actually do that, All the
00:02:17.770 --> 00:02:20.370
videos that you watch, they're all participatory
00:02:20.370 --> 00:02:25.949
credit. They're there in a format and on a sheet.
00:02:26.069 --> 00:02:28.169
So all you have to do is a couple of clicks and
00:02:28.169 --> 00:02:30.969
you turn that into the bar and you're done, you're
00:02:30.969 --> 00:02:33.590
ready. And if you look and you need, like I do,
00:02:33.629 --> 00:02:36.569
I need some of those specialty hours, then you
00:02:36.569 --> 00:02:38.430
go into the on -demand and you go, hey, I want
00:02:38.430 --> 00:02:40.349
to watch this one on substance abuse. I want
00:02:40.349 --> 00:02:43.969
to watch this one on stress. And it's really
00:02:43.969 --> 00:02:49.509
easy to do. appreciate the the BHBA for having
00:02:49.509 --> 00:02:53.669
that available for us and Lawyers Mutual that
00:02:53.669 --> 00:02:58.030
sponsors that. So let's get to this. There is
00:02:58.030 --> 00:03:00.509
a chat. There'll be some posts in there with
00:03:00.509 --> 00:03:03.430
the materials from today. It'll be monitored
00:03:03.430 --> 00:03:08.810
by the representative from BHBA who will repost
00:03:08.810 --> 00:03:11.509
those as necessary. This is a webinar. You can
00:03:11.509 --> 00:03:13.930
raise your hand. You can post questions in the
00:03:13.930 --> 00:03:18.229
Q &A. Marshall is going to work to monitor that,
00:03:18.250 --> 00:03:21.030
but there'll be a Q &A section at the end. So
00:03:21.030 --> 00:03:25.289
go ahead and post those there. And I'm going
00:03:25.289 --> 00:03:28.330
to introduce them. Marshall Cole, protecting
00:03:28.330 --> 00:03:31.150
your fee agreement so it protects you. Great
00:03:31.150 --> 00:03:34.849
title. Marshall is the managing attorney at Nemesek
00:03:34.849 --> 00:03:38.629
and Cole, a nationally recognized trial lawyer
00:03:38.629 --> 00:03:41.810
known for his success in complex, high -profile
00:03:41.810 --> 00:03:44.469
professional liability and civil litigation matters.
00:03:44.889 --> 00:03:47.110
Named by the Daily Journal as one of California's
00:03:47.110 --> 00:03:49.870
top professional liability attorneys, he's renowned
00:03:49.870 --> 00:03:52.729
for his proactive solutions -driven approach
00:03:52.729 --> 00:03:55.810
and consistent record of winning results at trial.
00:03:56.469 --> 00:03:58.550
Marshall, thank you so much for being here today.
00:03:58.669 --> 00:04:02.110
I'm gonna go off camera. Take it away. Thanks
00:04:02.110 --> 00:04:04.169
Dean and thanks to the Beverly Hills Bar Association
00:04:04.169 --> 00:04:07.409
as always for having me. I prepared a PowerPoint
00:04:07.409 --> 00:04:11.460
here so we'll work our way through it. But for
00:04:11.460 --> 00:04:13.939
starters, everything that we're going to go through
00:04:13.939 --> 00:04:17.660
today regarding fee agreements, it's something
00:04:17.660 --> 00:04:20.800
my office has dealt with and most likely has
00:04:20.800 --> 00:04:24.740
dealt with within the last 12 to 24 months. So
00:04:24.740 --> 00:04:26.740
all these tips that I'm going to provide you
00:04:26.740 --> 00:04:29.800
with or pitfalls that we're seeing are real claims,
00:04:30.079 --> 00:04:32.160
either legal malpractice claims or mandatory
00:04:32.160 --> 00:04:35.199
fee arbitration issues that we're seeing, arbitration
00:04:35.199 --> 00:04:38.339
issues that we're seeing. And so as we walk through
00:04:38.339 --> 00:04:40.759
each of the slides, hopefully you're going to
00:04:40.759 --> 00:04:43.779
leave with the ability to go back to your retainer
00:04:43.779 --> 00:04:45.920
agreement, take a look at it and see how you
00:04:45.920 --> 00:04:50.029
can make it better because. there's oftentimes
00:04:50.029 --> 00:04:53.009
a poorly drafted retainer agreement can create
00:04:53.009 --> 00:04:56.350
a lot of issues in a legal malpractice case that
00:04:56.350 --> 00:04:59.209
are otherwise avoidable. And so if you draft
00:04:59.209 --> 00:05:01.129
it and it's tight and you've complied with all
00:05:01.129 --> 00:05:04.350
the rules, you're gonna get all the protections
00:05:04.350 --> 00:05:07.209
that you put into that agreement that are gonna
00:05:07.209 --> 00:05:10.949
benefit you versus having it potentially avoidable
00:05:10.949 --> 00:05:13.829
by the court and set aside. So with that, I'll
00:05:13.829 --> 00:05:15.389
share my screen here, and we'll work our way
00:05:15.389 --> 00:05:17.389
through the slides. If you have questions, feel
00:05:17.389 --> 00:05:20.810
free. I'll try to monitor it. It can get a little
00:05:20.810 --> 00:05:23.850
tricky with sharing screen, but I'll do my best
00:05:23.850 --> 00:05:30.980
here. So give me a second. All right. So. Really,
00:05:31.339 --> 00:05:33.600
these are the rules that I'm not gonna go through
00:05:33.600 --> 00:05:36.579
each one of these rules with respect to this
00:05:36.579 --> 00:05:39.480
presentation, but you need to be aware of these
00:05:39.480 --> 00:05:42.879
when drafting your firm's fee agreement. And
00:05:42.879 --> 00:05:44.959
we'll touch on some of them, but again, I don't
00:05:44.959 --> 00:05:48.319
put the actual content of the rule. But this
00:05:48.319 --> 00:05:51.410
is just like 30 ,000 foot. These are the rules
00:05:51.410 --> 00:05:54.250
you need to focus on. And then we'll look at
00:05:54.250 --> 00:05:57.470
the business and professions code as well regarding
00:05:57.470 --> 00:06:00.430
each of the aspects of your attorney -client
00:06:00.430 --> 00:06:03.829
relationship, from formation to referral fees
00:06:03.829 --> 00:06:06.329
to the responsibilities that the lawyer has,
00:06:06.430 --> 00:06:09.490
the responsibilities that the clients have, and
00:06:09.490 --> 00:06:11.949
then also withdrawing and concluding your services.
00:06:12.350 --> 00:06:15.790
If you find yourself in one of these situations,
00:06:16.050 --> 00:06:18.730
the first thing you need to do is refer to the
00:06:18.730 --> 00:06:22.069
rule. See what you need to do and what you can
00:06:22.069 --> 00:06:24.550
and cannot do. And then, of course, the second
00:06:24.550 --> 00:06:27.389
thing you can always do is call me or my office,
00:06:27.410 --> 00:06:29.790
and we can walk you through any issues that come
00:06:29.790 --> 00:06:33.269
up. We offer outside general counsel services
00:06:33.269 --> 00:06:36.050
to a number of firms, from sole practitioner
00:06:36.050 --> 00:06:39.870
to hundreds and hundreds of lawyer firms. So
00:06:39.870 --> 00:06:43.680
we're always just one call away. After you've
00:06:43.680 --> 00:06:45.379
reviewed these rules, when you're starting to
00:06:45.379 --> 00:06:47.600
take a look at drafting your retainer agreement,
00:06:48.160 --> 00:06:50.639
the first thing you really need to focus on is
00:06:50.639 --> 00:06:52.339
obviously if you're going to have a contingency
00:06:52.339 --> 00:06:55.139
fee agreement or a non -contingency fee agreement,
00:06:55.339 --> 00:06:59.000
an hourly fee agreement. Both are governed by
00:06:59.000 --> 00:07:00.759
different code sections under the Business and
00:07:00.759 --> 00:07:05.060
Professions Code, and both have different aspects
00:07:05.060 --> 00:07:07.639
that you need to cover in order to make sure
00:07:07.639 --> 00:07:11.129
that it's in compliance with the rules. both
00:07:11.129 --> 00:07:14.029
generally need to be in writing unless it's for
00:07:14.029 --> 00:07:17.110
very small amounts, both need to be signed by
00:07:17.110 --> 00:07:19.310
the attorney and the client. And I know that
00:07:19.310 --> 00:07:22.290
sounds like such an obvious thing, but the amount
00:07:22.290 --> 00:07:25.089
of claims that I've handled where the attorney
00:07:25.089 --> 00:07:28.009
fee agreement is not signed by either the lawyer
00:07:28.009 --> 00:07:30.949
or the client is staggering. So many attorney
00:07:30.949 --> 00:07:33.990
fee agreements. Either don't come back signed
00:07:33.990 --> 00:07:36.730
or the attorney themselves never signed them.
00:07:36.930 --> 00:07:39.509
And again, just an easy mistake to avoid. And
00:07:39.509 --> 00:07:41.990
so some of this may seem like, of course, this
00:07:41.990 --> 00:07:44.470
is so obvious, Marshall, but I wouldn't be talking
00:07:44.470 --> 00:07:46.870
about it if it didn't happen on a regular basis.
00:07:47.389 --> 00:07:49.889
And sometimes it happens with people who never
00:07:49.889 --> 00:07:51.430
have this issue. And then, of course, they get
00:07:51.430 --> 00:07:54.029
busy. and they forget to get it signed or sign
00:07:54.029 --> 00:07:56.930
themselves. So these are the two business and
00:07:56.930 --> 00:07:58.870
professions code sections that are very important
00:07:58.870 --> 00:08:01.370
to know and understand when you're drafting an
00:08:01.370 --> 00:08:04.009
attorney -client fee agreement. And if it's been
00:08:04.009 --> 00:08:07.050
a year or two years or more since you've looked
00:08:07.050 --> 00:08:09.300
at your attorney -client fee agreement, you need
00:08:09.300 --> 00:08:11.879
to take the time after this presentation to go
00:08:11.879 --> 00:08:14.579
back and look at it and see if it's still applicable
00:08:14.579 --> 00:08:17.120
to the type of work you're doing to the type
00:08:17.120 --> 00:08:20.259
of clients you're servicing because I don't believe
00:08:20.259 --> 00:08:23.720
that retainer agreements are a form type of contract
00:08:23.720 --> 00:08:26.100
that you can take from one client to the next.
00:08:26.120 --> 00:08:29.819
You can certainly have a template but you definitely
00:08:29.819 --> 00:08:33.549
want to take a look at it for each client to
00:08:33.549 --> 00:08:36.110
make sure that that particular agreement fits
00:08:36.110 --> 00:08:38.570
for what you're going to be doing. My office
00:08:38.570 --> 00:08:41.470
has a number of different types of attorney -client
00:08:41.470 --> 00:08:43.990
fee agreements for different types of matters
00:08:43.990 --> 00:08:46.850
that we handle. Private business litigation,
00:08:47.230 --> 00:08:49.590
state bar matters, insurance defense matters,
00:08:50.129 --> 00:08:52.110
plaintiff side contingency matters, should we
00:08:52.110 --> 00:08:54.809
handle one of those. There's a number of different
00:08:54.809 --> 00:08:58.169
provisions that we like depending on what type
00:08:58.169 --> 00:09:01.740
of matter we have. If you're the managing partner
00:09:01.740 --> 00:09:04.580
of a firm, small or large, you really need to
00:09:04.580 --> 00:09:07.480
understand what retainer agreements exist within
00:09:07.480 --> 00:09:10.019
your firm and what's being sent out to clients
00:09:10.019 --> 00:09:12.639
and make sure there's a large amount of oversight
00:09:12.639 --> 00:09:16.259
over that because we've seen cases arise from
00:09:16.259 --> 00:09:19.190
retainer agreements. that gets sent out to a
00:09:19.190 --> 00:09:21.669
client, which haven't even been approved by the
00:09:21.669 --> 00:09:24.009
firm's general counselor managing partner. And
00:09:24.009 --> 00:09:26.009
they've modified and tweaked things and lo and
00:09:26.009 --> 00:09:28.629
behold, firm gets sued and now they're dealing
00:09:28.629 --> 00:09:31.070
with a retainer agreement that the managing partner
00:09:31.070 --> 00:09:34.950
didn't otherwise approve. So again, this requires
00:09:34.950 --> 00:09:38.009
a lot of oversight and a lot of ongoing diligence,
00:09:38.450 --> 00:09:42.009
similar to, I often give sort of ethics presentations
00:09:42.009 --> 00:09:44.929
on conflicts of interest. And like a conflict
00:09:44.929 --> 00:09:47.820
of interest in a conflict waiver, Conflicts modify
00:09:47.820 --> 00:09:49.940
and change over time, and you need to get your
00:09:49.940 --> 00:09:52.200
waivers updated. Now, an attorney -client fee
00:09:52.200 --> 00:09:55.299
agreement, it certainly can change, but you're
00:09:55.299 --> 00:09:57.080
not going to get more than one throughout the
00:09:57.080 --> 00:10:00.440
representation. But definitely, from one client
00:10:00.440 --> 00:10:03.779
to the next, you need to take a look at the agreement,
00:10:04.159 --> 00:10:05.840
make sure it complies with the rules, and make
00:10:05.840 --> 00:10:10.159
sure it's benefiting you and the firm in the
00:10:10.159 --> 00:10:14.320
way you want it to. And as we move forward here,
00:10:14.460 --> 00:10:17.549
if you don't comply, it can become a problem,
00:10:17.549 --> 00:10:20.269
and it can become a problem really fast. And
00:10:20.269 --> 00:10:23.870
each of these four issues that I've provided
00:10:23.870 --> 00:10:27.429
here as examples, we've seen very recently. The
00:10:27.429 --> 00:10:30.809
first one, I just resolved a case about 10 days
00:10:30.809 --> 00:10:34.450
ago, not because of the issue that both the attorney
00:10:34.450 --> 00:10:37.429
and the client didn't sign, but because the issue
00:10:37.429 --> 00:10:41.409
of the duplicate copy was not sent back to the
00:10:41.409 --> 00:10:45.409
client. So the way the rule works here, and it's
00:10:45.720 --> 00:10:50.279
It's a little bit overkill, but it's the rule.
00:10:50.500 --> 00:10:53.480
And what it says is once the agreement is fully
00:10:53.480 --> 00:10:56.720
executed by the attorney and the client, you
00:10:56.720 --> 00:11:00.340
as the lawyer need to send a fully executed copy
00:11:00.340 --> 00:11:04.519
of that retainer agreement to the client. And
00:11:04.519 --> 00:11:08.139
the issues come up when the lawyer signs the
00:11:08.139 --> 00:11:10.519
retainer agreement, then they send it to the
00:11:10.519 --> 00:11:13.240
client. The client signs the retainer agreement
00:11:13.240 --> 00:11:17.159
and emails the agreement back. The lawyer often
00:11:17.159 --> 00:11:19.320
thinks, well, look, I've got a fully signed agreement.
00:11:19.480 --> 00:11:22.539
They clearly have the copy because they scanned
00:11:22.539 --> 00:11:24.740
and sent it, so I don't need to do anything.
00:11:24.820 --> 00:11:26.879
Or there's just an oversight altogether and they
00:11:26.879 --> 00:11:30.980
don't send it. The argument that was made in
00:11:30.980 --> 00:11:33.419
the case that I was defending was that it didn't
00:11:33.419 --> 00:11:35.299
comply with the business and professions code
00:11:35.299 --> 00:11:39.379
because a fully executed copy wasn't sent and
00:11:39.379 --> 00:11:41.840
a retainer agreement was avoidable at the client's
00:11:41.840 --> 00:11:44.809
option. And the firm I was representing had a
00:11:44.809 --> 00:11:46.669
cross -complaint for attorney's fees and they
00:11:46.669 --> 00:11:48.850
were of course claiming that we shouldn't get
00:11:48.850 --> 00:11:51.789
those fees or at best we would be entitled to
00:11:51.789 --> 00:11:53.809
quantum merit as you see there on the screen
00:11:53.809 --> 00:11:57.350
and if that kicks in depending on what your hourly
00:11:57.350 --> 00:11:59.710
rate that you're charging at your firm is you
00:11:59.710 --> 00:12:02.370
may not be getting a thousand dollars an hour
00:12:02.370 --> 00:12:04.210
eight hundred dollars an hour you may be getting
00:12:04.210 --> 00:12:06.190
depending on your jurisdiction three hundred
00:12:06.190 --> 00:12:08.590
dollars an hour and you want to avoid that situation
00:12:08.590 --> 00:12:15.220
now if the matter had excuse me I think in front
00:12:15.220 --> 00:12:18.480
of a jury, irrespective of the rule violation,
00:12:19.019 --> 00:12:21.620
I think we have a lot of strong arguments and
00:12:21.620 --> 00:12:23.860
evidence in those types of cases where I've dealt
00:12:23.860 --> 00:12:26.600
with this to sort of neutralize that what I would
00:12:26.600 --> 00:12:29.519
characterize as like a ticky tack sort of breach
00:12:29.519 --> 00:12:32.159
regarding the business and professions code.
00:12:32.539 --> 00:12:36.059
But nonetheless, it exists. and where it can
00:12:36.059 --> 00:12:39.039
really cause problems if you don't send it back
00:12:39.039 --> 00:12:41.600
and then the client raises it in litigation that
00:12:41.600 --> 00:12:44.200
it's avoidable is with respect to an arbitration
00:12:44.200 --> 00:12:47.519
provision. If you didn't strictly comply with
00:12:47.519 --> 00:12:50.720
the rules and there's a petition to compel binding
00:12:50.720 --> 00:12:54.460
arbitration, I've had numerous courts deny petitions
00:12:54.460 --> 00:12:56.460
to compel binding arbitration, which were then
00:12:56.460 --> 00:12:59.659
affirmed on appeal because strict compliance
00:12:59.960 --> 00:13:03.419
was not adhered to. And so it's just a simple
00:13:03.419 --> 00:13:06.019
issue. And again, think of it, you've spent all
00:13:06.019 --> 00:13:08.480
this money, you've got this perfect retainer
00:13:08.480 --> 00:13:10.679
agreement, it's doing everything you want, it's
00:13:10.679 --> 00:13:13.519
protecting you, the client's protected, only
00:13:13.519 --> 00:13:16.440
for it to be voided because you just didn't send
00:13:16.440 --> 00:13:21.919
that duplicate copy back. I harp on this one
00:13:21.919 --> 00:13:24.659
a lot because it's such an easy one. And if you
00:13:24.659 --> 00:13:29.519
have a high volume practice, it's a very easy
00:13:29.519 --> 00:13:32.559
oversight. And so it's one that you want to have
00:13:32.559 --> 00:13:35.779
sort of standard operating procedure in place
00:13:35.779 --> 00:13:39.919
to ensure that your staff members or you are
00:13:39.919 --> 00:13:42.799
complying with this rule to just send it back,
00:13:43.120 --> 00:13:45.639
get that duplicate copy there, and then you've
00:13:45.639 --> 00:13:51.330
taken care of this issue. The next issue that
00:13:51.330 --> 00:13:55.409
we see a lot is, and it's coming up more and
00:13:55.409 --> 00:14:00.169
more, is dealing with unconscionable fees. And
00:14:00.169 --> 00:14:03.870
because rates are getting so high in the city
00:14:03.870 --> 00:14:06.870
of Los Angeles and presumably in metropolitan
00:14:06.870 --> 00:14:10.309
areas throughout the state of California, courts
00:14:10.309 --> 00:14:14.250
are taking a harder look at what is an unconscionable
00:14:14.250 --> 00:14:18.940
fee. And so, there's a number of factors in play
00:14:18.940 --> 00:14:22.159
that are listed here. Experience is a big one.
00:14:22.460 --> 00:14:25.220
And also now I want to point out on the contingency
00:14:25.220 --> 00:14:28.139
side, and other states have taken a much more
00:14:28.139 --> 00:14:31.059
hard line with this, which is quick settlements,
00:14:31.179 --> 00:14:34.240
right? If you're a contingency fee lawyer, part
00:14:34.240 --> 00:14:37.080
of the one perk of being a contingency fee lawyer
00:14:37.080 --> 00:14:39.799
is a quick settlement, right? You've got a nice
00:14:39.799 --> 00:14:42.740
30 % contingency fee, 40%, whatever it might
00:14:42.740 --> 00:14:45.779
be, and you get a big case and you settle it.
00:14:45.720 --> 00:14:48.299
10 days into the case or whatever it might be.
00:14:48.919 --> 00:14:50.899
The California case law is pretty clear that
00:14:50.899 --> 00:14:54.679
those fees are earned. That's a benefit of being
00:14:54.679 --> 00:14:56.419
a contingency fee lawyer, because of course,
00:14:56.440 --> 00:14:58.860
for every one of those cases you get, there's
00:14:58.860 --> 00:15:01.200
20 where you work for five years and don't get
00:15:01.200 --> 00:15:06.399
a dollar. And so despite that, I think courts
00:15:06.399 --> 00:15:08.759
are starting to take a different look at quick
00:15:08.759 --> 00:15:11.919
settlements, but also setting aside the rule
00:15:11.919 --> 00:15:16.299
and whether it's proper or not, Dealing with
00:15:16.299 --> 00:15:19.840
these types of issues at trial in front of 12
00:15:19.840 --> 00:15:24.159
jurors are creating certain issues that I am
00:15:24.159 --> 00:15:26.559
seeing. And look, there's nothing that can necessarily
00:15:26.559 --> 00:15:28.639
be done about it. If you're a contingency fee
00:15:28.639 --> 00:15:30.539
lawyer, you get a quick settlement and then you
00:15:30.539 --> 00:15:34.539
end up in litigation. You just have to neutralize
00:15:34.539 --> 00:15:37.480
sort of the greed component, but that's something
00:15:37.480 --> 00:15:40.960
that exists here. And again, if your firm's charging
00:15:40.960 --> 00:15:43.899
a high hourly rate, you really need to make sure
00:15:43.899 --> 00:15:46.379
that you're overseeing your associates, that
00:15:46.379 --> 00:15:49.399
the work is not being block billed, that the
00:15:49.399 --> 00:15:52.519
hours being charged are reasonable for the task,
00:15:52.860 --> 00:15:58.580
because bills are a very important part of the
00:15:58.580 --> 00:16:02.100
process and tie directly into the retainer agreement,
00:16:02.480 --> 00:16:04.940
especially if hourly rates are denoted in that
00:16:04.940 --> 00:16:07.210
retainer agreement. you're going to want to make
00:16:07.210 --> 00:16:10.610
sure that there's oversight there. And if you
00:16:10.610 --> 00:16:12.830
find yourself in a case where you've got a big
00:16:12.830 --> 00:16:15.149
receivable and you want to go collect it, the
00:16:15.149 --> 00:16:17.590
first thing that a savvy plaintiff's lawyer is
00:16:17.590 --> 00:16:19.190
going to do if you're just dealing with a fee
00:16:19.190 --> 00:16:21.710
dispute is hire a billing expert who's going
00:16:21.710 --> 00:16:24.649
to go through and chop up the bills based on
00:16:24.649 --> 00:16:27.870
block billing, hourly rate, skill required, lack
00:16:27.870 --> 00:16:30.629
of experience, all these factors. And again,
00:16:31.029 --> 00:16:34.389
you're going to have that huge receivable chopped
00:16:34.389 --> 00:16:38.809
up 50 % at least. And if there was proper oversight
00:16:38.809 --> 00:16:42.049
from the outset, you would have potentially avoided
00:16:42.049 --> 00:16:47.509
that issue. So as we get into the actual terms
00:16:47.509 --> 00:16:50.610
of your retainer agreement, another part that's
00:16:50.610 --> 00:16:54.250
really, really important is the scope of representation.
00:16:54.750 --> 00:16:59.450
We see a lot of cases come up because the scope
00:16:59.450 --> 00:17:02.769
of representation isn't clearly outlined in the
00:17:02.769 --> 00:17:06.849
retainer agreement. And what I mean by scope
00:17:06.849 --> 00:17:09.670
of representation isn't just what you're going
00:17:09.670 --> 00:17:13.009
to do for that client. What's also really, really
00:17:13.009 --> 00:17:16.569
important is to identify what you are not going
00:17:16.569 --> 00:17:19.309
to do. And that's really where the issues come
00:17:19.309 --> 00:17:21.670
up. For instance, in my firm's retainer agreement,
00:17:21.809 --> 00:17:24.109
I don't care which version it is, every one of
00:17:24.109 --> 00:17:25.950
them is gonna say that we don't give tax advice.
00:17:26.150 --> 00:17:27.549
We're not tax lawyers. I don't know anything
00:17:27.549 --> 00:17:30.549
about tax law. So when settlement money comes
00:17:30.549 --> 00:17:32.970
in or we're dealing with settlement, oftentimes
00:17:32.970 --> 00:17:35.950
questions come up. Is this taxable? How am I
00:17:35.950 --> 00:17:38.250
gonna get treated with respect to this money?
00:17:38.710 --> 00:17:40.890
We refer them out to a lawyer who can specialize
00:17:40.890 --> 00:17:44.880
in that. No guarantees on outcomes is very important.
00:17:45.359 --> 00:17:47.359
Not to say that if you don't have something like
00:17:47.359 --> 00:17:49.599
that, the client can say he guaranteed me this
00:17:49.599 --> 00:17:51.759
outcome. But if you put it in the retainer, it's
00:17:51.759 --> 00:17:54.220
quite clear that you're not guaranteeing an outcome.
00:17:54.480 --> 00:17:56.539
And I think it's really important, especially
00:17:56.539 --> 00:17:59.539
for lay clients, to set their expectations from
00:17:59.539 --> 00:18:01.680
the outset. Look, we're going to do work for
00:18:01.680 --> 00:18:04.680
you. We're going to do our best. But we're certainly
00:18:04.680 --> 00:18:08.019
not guaranteeing a particular outcome. And then
00:18:08.019 --> 00:18:11.069
the other area where I often see or two other
00:18:11.069 --> 00:18:13.490
areas where I often see issues is if you get
00:18:13.490 --> 00:18:16.049
a judgment, whether or not the scope of your
00:18:16.049 --> 00:18:19.230
retention is going to cover collecting that judgment.
00:18:19.730 --> 00:18:23.250
And then the other one is if there's a judgment,
00:18:23.569 --> 00:18:25.869
whether your firm is going to handle the appeal.
00:18:26.170 --> 00:18:28.910
And if you're silent on those two issues and
00:18:28.910 --> 00:18:31.109
you go through trial on a particular matter,
00:18:32.609 --> 00:18:35.450
there can become problems regarding whether or
00:18:35.450 --> 00:18:37.970
not the scope of your representation covered
00:18:38.200 --> 00:18:42.299
judgment collection or Appellate work and so
00:18:42.299 --> 00:18:44.299
I think depending on the type of work you do
00:18:44.299 --> 00:18:46.640
It's really important to say what you're going
00:18:46.640 --> 00:18:48.880
to do and then again what you're not going to
00:18:48.880 --> 00:18:54.519
do another big issue that we see a lot is A single
00:18:54.519 --> 00:18:56.839
retainer agreement for repeat clients repeat
00:18:56.839 --> 00:18:59.500
clients are great Some of the best people to
00:18:59.500 --> 00:19:02.339
deal with but you've got to remember no matter
00:19:02.339 --> 00:19:04.099
how many times you've been to dinner with that
00:19:04.099 --> 00:19:07.109
person played tennis or golf or whatever it might
00:19:07.109 --> 00:19:09.529
be with that client, they really aren't your
00:19:09.529 --> 00:19:12.150
friend. And you really don't want to let your
00:19:12.150 --> 00:19:14.589
guard down. And when you start to have repeat
00:19:14.589 --> 00:19:17.869
clients, we let our guard down, it becomes more
00:19:17.869 --> 00:19:21.390
casual. One matter turns into two matters, two
00:19:21.390 --> 00:19:23.609
matters turns into five. And the next thing you
00:19:23.609 --> 00:19:27.349
know, you're handling a divorce and you do business
00:19:27.349 --> 00:19:31.690
litigation, okay? You just want to have a single
00:19:31.690 --> 00:19:36.599
retainer for each matter. And it's not burdensome
00:19:36.599 --> 00:19:39.660
for the client. Everyone understands that, you
00:19:39.660 --> 00:19:42.319
know, contracts are part of what we do, and it's
00:19:42.319 --> 00:19:45.700
the foundation for the relationship. And it just
00:19:45.700 --> 00:19:49.859
makes it so everyone's objectives are clear for
00:19:49.859 --> 00:19:52.640
that particular matter. And if you have a retainer
00:19:52.640 --> 00:19:55.400
agreement that's six years old or two years old
00:19:55.400 --> 00:19:58.920
from seven matters ago, it's very easy when something
00:19:58.920 --> 00:20:03.079
goes wrong for that client to say, this agreement
00:20:03.240 --> 00:20:06.240
Didn't apply to that look at what we're handling
00:20:06.240 --> 00:20:08.559
Compared to what that retainer agreement applied
00:20:08.559 --> 00:20:11.500
for if you are gonna have a single retainer agreement
00:20:11.500 --> 00:20:14.680
Which says this agreement applies for this matter
00:20:14.680 --> 00:20:16.700
and any other future matters that we are gonna
00:20:16.700 --> 00:20:20.539
handle it better be It certainly shouldn't be
00:20:20.539 --> 00:20:24.960
for litigation. It should be for Ongoing advice
00:20:24.960 --> 00:20:27.880
right if you're servicing a client on an ongoing
00:20:27.880 --> 00:20:32.700
basis that spans a number of years That's a different
00:20:32.700 --> 00:20:36.119
thing. And because you're handling the same thing
00:20:36.119 --> 00:20:38.559
within that scope of representation, some clients
00:20:38.559 --> 00:20:40.619
that I provide outside general counsel service
00:20:40.619 --> 00:20:43.279
for, we have a retainer agreement and it enables
00:20:43.279 --> 00:20:46.400
them to pick up the phone, call me regarding
00:20:46.400 --> 00:20:51.079
general counsel advice. If it starts to get into
00:20:51.079 --> 00:20:53.599
a litigation matter, we have a new retainer agreement.
00:20:53.779 --> 00:20:56.099
I'm separately retained to handle the litigation
00:20:56.099 --> 00:21:00.329
matter. And we go forward. just like that. Never
00:21:00.329 --> 00:21:02.849
once have I had an issue with it. And oftentimes
00:21:02.849 --> 00:21:05.609
I find the single retainer agreements come up
00:21:05.609 --> 00:21:07.849
in the entertainment context for whatever reason.
00:21:08.190 --> 00:21:09.970
So if you're an entertainment lawyer and this
00:21:09.970 --> 00:21:12.450
is something that's part of your practice, I
00:21:12.450 --> 00:21:16.150
would really try to eliminate it as best you
00:21:16.150 --> 00:21:20.529
can and just have a separate retainer agreement
00:21:20.529 --> 00:21:22.710
for each file. Let me just check and see if I
00:21:22.710 --> 00:21:25.349
have any questions here. If I can figure that
00:21:25.349 --> 00:21:29.730
out real quick. Q &A we got hold on one sec.
00:21:29.730 --> 00:21:35.069
I got a few here. So give me a sec Okay AI and
00:21:35.069 --> 00:21:37.150
your agreement I'll touch upon I think that would
00:21:37.150 --> 00:21:41.009
be better serve we I've given a ton of AI Presentations,
00:21:41.029 --> 00:21:42.849
but I'll touch upon whether you need to disclose
00:21:42.849 --> 00:21:53.809
that Is the signature The signature requirement
00:21:53.809 --> 00:22:00.319
is required That's another question. So DocuSign,
00:22:00.480 --> 00:22:04.779
DocuSign is okay, but I don't do it. And I think
00:22:04.779 --> 00:22:09.500
I sort of have a negative view of DocuSign. I
00:22:09.500 --> 00:22:12.759
think even though a contract is when you receive
00:22:12.759 --> 00:22:15.190
it and sign it, you're. deemed to have read it,
00:22:15.430 --> 00:22:17.750
right? That's well -established California case
00:22:17.750 --> 00:22:21.289
law. I think everyone in society docusigns things
00:22:21.289 --> 00:22:22.990
all day long, right? You go to the doctor's office,
00:22:23.109 --> 00:22:24.930
you sign that little gray box, and you don't
00:22:24.930 --> 00:22:27.690
even know what you're reading. So I think if
00:22:27.690 --> 00:22:29.990
you're at trial, you're going to run into more
00:22:29.990 --> 00:22:32.589
of an optical issue with a bunch of jurors and
00:22:32.589 --> 00:22:34.450
a client who docusigns something, everyone's
00:22:34.450 --> 00:22:36.089
going to understand that they didn't read it.
00:22:36.190 --> 00:22:38.710
And what sympathies may come into play from there.
00:22:39.039 --> 00:22:42.339
Who knows? So I think for a retainer agreement,
00:22:42.720 --> 00:22:45.420
just get the wet signature. I know that's asking
00:22:45.420 --> 00:22:48.079
a lot and that's certainly best practice. That
00:22:48.079 --> 00:22:50.940
is not, I don't think your retainer agreement
00:22:50.940 --> 00:22:53.079
is going to be voided because it's a docusign.
00:22:53.220 --> 00:22:55.220
I'm just going to hear, I'm here to tell you
00:22:55.220 --> 00:22:57.779
what best practice is. Have I had clients send
00:22:57.779 --> 00:23:00.940
back a docusign? I'm sure we have, but it is
00:23:00.940 --> 00:23:04.640
not something that I allow, certainly from the
00:23:04.640 --> 00:23:07.059
attorney end. And we always try to get a wet
00:23:07.059 --> 00:23:09.529
signature on a retainer agreement. Other types
00:23:09.529 --> 00:23:12.190
of documents, of course, I think e -signatures
00:23:12.190 --> 00:23:14.670
are okay with regarding pleadings and things
00:23:14.670 --> 00:23:19.509
like that. There's a question about Zoho sign.
00:23:20.190 --> 00:23:24.049
I don't know what that is. I don't know what
00:23:24.049 --> 00:23:28.730
that is. So forgive me. There's a bunch here.
00:23:29.670 --> 00:23:35.440
So, okay. If you hand the fully executed copy
00:23:35.440 --> 00:23:37.599
of the retainer agreement to the client right
00:23:37.599 --> 00:23:39.579
away, for instance, if they come and sign it
00:23:39.579 --> 00:23:43.380
in person, memorialize that. I had a case where
00:23:43.380 --> 00:23:46.759
a lawyer said, look, we signed it in person,
00:23:46.779 --> 00:23:48.900
and they walked out with the duplicate copy.
00:23:49.839 --> 00:23:52.240
Of course, the client disputed that. The court
00:23:52.240 --> 00:23:54.640
sided with the client. And so that wasn't enough.
00:23:54.880 --> 00:23:56.859
If you're going to let them walk out with the
00:23:56.859 --> 00:24:00.440
duplicate copy, memorialize it in an email. Great
00:24:00.440 --> 00:24:02.579
meeting you. Thanks for sending the retainer
00:24:02.579 --> 00:24:04.460
agreement, maybe even attach it and say, here's
00:24:04.460 --> 00:24:07.400
another copy of it or confirming that you walked
00:24:07.400 --> 00:24:10.039
out with the fully executed copy. That's what
00:24:10.039 --> 00:24:11.839
you need to do. If you don't memorialize it,
00:24:11.839 --> 00:24:13.559
I think you're just going to run into a credibility
00:24:13.559 --> 00:24:16.880
issue. And I've dealt with that. Someone asked,
00:24:16.940 --> 00:24:20.299
what is the greed component? The greed component
00:24:20.299 --> 00:24:24.660
is view is basically a plaintiff's attorney convincing
00:24:24.660 --> 00:24:27.960
a jury that a contingency free lawyer getting
00:24:27.960 --> 00:24:29.660
a quick settlement and trying to keep the money
00:24:29.660 --> 00:24:33.009
is greedy. That's the greed component. If you
00:24:33.009 --> 00:24:36.829
get a $2 million fee after 10 days of work, a
00:24:36.829 --> 00:24:39.410
plaintiff's lawyer is going to have some impact
00:24:39.410 --> 00:24:43.190
with a jury that the lawyer trying to keep that
00:24:43.190 --> 00:24:45.609
fee is being greedy. They didn't really do the
00:24:45.609 --> 00:24:47.549
work. They didn't deserve the money. I disagree
00:24:47.549 --> 00:24:49.349
with that completely, and we've dealt with it
00:24:49.349 --> 00:24:52.130
in jury trials. But it comes up, and depending
00:24:52.130 --> 00:24:53.930
on the amount of the fee. That's just an issue
00:24:53.930 --> 00:24:56.250
to be aware of. It was sort of a comment I made.
00:24:57.450 --> 00:24:59.829
Let me pause on the rest of these questions.
00:25:01.410 --> 00:25:03.849
because I've got to get through this, and I'm
00:25:03.849 --> 00:25:10.750
always happy to answer some via email. And then
00:25:10.750 --> 00:25:13.549
I will point out differences in my advice regarding
00:25:13.549 --> 00:25:15.930
purely transactional practices. For the most
00:25:15.930 --> 00:25:18.029
part, for those of you who are just handling
00:25:18.029 --> 00:25:21.420
transactional work, the fee agreement rules are
00:25:21.420 --> 00:25:25.119
the same. We handle transactional clients all
00:25:25.119 --> 00:25:28.319
the time. Most of the matters that we deal with
00:25:28.319 --> 00:25:30.819
regarding fee disputes of recent are transactional
00:25:30.819 --> 00:25:35.400
in nature, entertainment, tax, and trust in the
00:25:35.400 --> 00:25:39.079
states. So everything that I'm saying here applies
00:25:39.079 --> 00:25:42.880
with full weight to litigation, as it does to
00:25:42.880 --> 00:25:45.839
transactional. please don't think I'm ignoring
00:25:45.839 --> 00:25:49.900
one group over the other. I really group retainer
00:25:49.900 --> 00:25:52.740
agreements in two boxes, contingency and hourly.
00:25:52.900 --> 00:25:54.920
And so if you're a transactional lawyer, you're
00:25:54.920 --> 00:25:58.440
gonna fall into the hourly portion of that. So
00:25:58.440 --> 00:26:01.039
let me jump back in and I'll try to keep monitoring
00:26:01.039 --> 00:26:10.000
the questions as I go here. Okay, so this is
00:26:10.000 --> 00:26:12.240
another big issue. I keep saying that all of
00:26:12.240 --> 00:26:14.640
these are big issues, but. Clients authority
00:26:14.640 --> 00:26:16.640
over settlement. So it's really important to
00:26:16.640 --> 00:26:19.859
understand you can point these types of things
00:26:19.859 --> 00:26:21.559
out in your retainer agreement. That would be
00:26:21.559 --> 00:26:24.660
a best practice. Certainly doesn't have to be
00:26:24.660 --> 00:26:27.640
a must, but understanding when it comes time
00:26:27.640 --> 00:26:30.579
to settlement. It's a good time to pull back
00:26:30.579 --> 00:26:33.619
out your retainer agreement and make sure everything
00:26:33.619 --> 00:26:36.480
is covered in there. If you're on the contingency
00:26:36.480 --> 00:26:39.400
costs, where are those coming from? You want
00:26:39.400 --> 00:26:42.319
to make sure that you're compliant. and that
00:26:42.319 --> 00:26:43.640
your client's complying, and that your client
00:26:43.640 --> 00:26:47.759
understands what's going to happen. But it's
00:26:47.759 --> 00:26:50.819
important to note in the retainer agreement what
00:26:50.819 --> 00:26:53.160
decisions the client, generally speaking, is
00:26:53.160 --> 00:26:56.180
going to make. Our clients really drive the outcome
00:26:56.180 --> 00:27:01.339
of critical decisions within a case. We as lawyers
00:27:01.339 --> 00:27:05.500
certainly have authority to make decisions on
00:27:05.500 --> 00:27:07.720
a day -to -day basis regarding a case without
00:27:07.720 --> 00:27:12.259
our client's consent. They have a right to make
00:27:12.259 --> 00:27:14.759
informed decisions on critical issues. I gave
00:27:14.759 --> 00:27:18.359
a couple examples here. And depending on the
00:27:18.359 --> 00:27:20.579
type of practice you have, whether that's transactional
00:27:20.579 --> 00:27:23.440
or otherwise, and depending on your client base,
00:27:23.700 --> 00:27:26.920
you may want to have more of these types of items
00:27:26.920 --> 00:27:29.420
identified as examples in your retainer agreement
00:27:29.420 --> 00:27:33.480
than not. I don't necessarily have very many
00:27:33.480 --> 00:27:36.140
of these based on the type of business that I
00:27:36.140 --> 00:27:40.900
operate. And so, again, it's a really important
00:27:40.900 --> 00:27:44.140
point in time where we see things go wrong, of
00:27:44.140 --> 00:27:51.119
course, is when settlement comes up. And so these
00:27:51.119 --> 00:27:53.359
are prohibited provisions, which we have seen
00:27:53.359 --> 00:27:56.160
in retainer agreements, which have voided retainer
00:27:56.160 --> 00:28:00.579
agreements as a whole. The attorney certainly
00:28:00.579 --> 00:28:03.640
can't say, I have exclusive authority to do these
00:28:03.640 --> 00:28:07.640
types of things. A big one that comes up is that
00:28:07.680 --> 00:28:11.259
an attorney can settle the case if it's a good
00:28:11.259 --> 00:28:14.700
offer, if it makes sense, if it's in the client's
00:28:14.700 --> 00:28:18.140
best interest. If there's any attorney approval
00:28:18.140 --> 00:28:22.640
in there, you cannot have it. It's just something
00:28:22.640 --> 00:28:26.079
you can't do. And again, it's kind of shocking
00:28:26.079 --> 00:28:28.859
the amount of times I give these seminars, say
00:28:28.859 --> 00:28:32.160
these types of things. And then six months later,
00:28:32.160 --> 00:28:36.009
we see a retainer agreement come in where this
00:28:36.009 --> 00:28:39.089
type of provision is against public policy and
00:28:39.089 --> 00:28:41.589
it's going to be voided. And it doesn't necessarily
00:28:41.589 --> 00:28:44.869
have to be tied to settlement. And we'll get
00:28:44.869 --> 00:28:46.910
to some slides regarding withdrawal, I think
00:28:46.910 --> 00:28:50.049
the next slide. You really don't want to have
00:28:50.049 --> 00:28:52.329
anything in your retainer agreement where there's
00:28:52.329 --> 00:28:54.150
sort of an if that, right? You don't want to
00:28:54.150 --> 00:28:57.809
be conditioning anything you can do on something
00:28:57.809 --> 00:29:00.890
else regarding the particular matter or the deal
00:29:00.890 --> 00:29:04.420
that you're handling because it's going to most
00:29:04.420 --> 00:29:08.519
likely look like avoidable provision. And once
00:29:08.519 --> 00:29:10.559
you avoid, once there's a avoidable provision
00:29:10.559 --> 00:29:13.180
in your retainer agreement, unlike contracts
00:29:13.180 --> 00:29:16.119
in general where you can void out a particular
00:29:16.119 --> 00:29:17.819
provision or a settlement agreement where you
00:29:17.819 --> 00:29:22.259
see an integration clause. and a severance clause
00:29:22.259 --> 00:29:25.000
where the rest of the contract is going to survive.
00:29:25.160 --> 00:29:26.940
That's not going to happen in a retainer agreement.
00:29:27.160 --> 00:29:29.700
Either the retainer agreement is going to live
00:29:29.700 --> 00:29:33.680
or it is going to die. And I think for good reason,
00:29:34.019 --> 00:29:38.220
courts are going to view it in the light most
00:29:38.220 --> 00:29:41.039
favorable to the client because we know the law,
00:29:41.140 --> 00:29:43.779
we know the rules, we drafted the contract. And
00:29:43.779 --> 00:29:47.180
so if we're going to try to shortcut something
00:29:47.180 --> 00:29:50.079
or you know, frame it in our advantage in a way
00:29:50.079 --> 00:29:52.460
that's truly unfair to the client, courts can
00:29:52.460 --> 00:29:55.319
and should set those aside and they do it quite
00:29:55.319 --> 00:29:58.380
often. So again, these are easy ones to try and
00:29:58.380 --> 00:30:05.660
avoid. Same thing with restricting termination
00:30:05.660 --> 00:30:10.819
rights. This also comes up quite a lot. You want
00:30:10.819 --> 00:30:13.619
to avoid these types of things. And if you are
00:30:13.619 --> 00:30:17.210
going to put in what happens upon termination
00:30:17.210 --> 00:30:20.049
or what could happen upon termination or what
00:30:20.049 --> 00:30:23.089
could cause a lawyer to want to withdraw. Certain
00:30:23.089 --> 00:30:25.849
things are okay in our retainer agreement and
00:30:25.849 --> 00:30:27.849
in most retainer agreements I see and I certainly
00:30:27.849 --> 00:30:31.789
recommend attorney -client communication is key.
00:30:32.269 --> 00:30:35.869
Number one. Number two, you as the lawyer are
00:30:35.869 --> 00:30:38.750
not required to do whatever your client tells
00:30:38.750 --> 00:30:42.289
you to do. If your client is not listening to
00:30:42.289 --> 00:30:45.670
you, and not following your advice, you are certainly
00:30:45.670 --> 00:30:48.890
free to end the representation and withdraw.
00:30:49.190 --> 00:30:51.789
If that's in a transactional matter, it's certainly
00:30:51.789 --> 00:30:54.170
easier to do so than if you're in litigation.
00:30:54.490 --> 00:30:56.690
If you're in litigation, you've either got to
00:30:56.690 --> 00:30:58.950
get a signed substitution or you got to file
00:30:58.950 --> 00:31:02.869
a motion with the court. These are pretty clear
00:31:02.869 --> 00:31:06.549
rules, but it's important again to just accurately
00:31:06.549 --> 00:31:10.359
frame when it can happen. And so that the client
00:31:10.359 --> 00:31:15.680
is better informed and claims arise often because
00:31:15.680 --> 00:31:18.440
attorneys try to withdraw, whether that's in
00:31:18.440 --> 00:31:21.279
any setting on the eve of a deal closing or litigation
00:31:21.279 --> 00:31:24.920
or trial date, too close in time to the event.
00:31:25.119 --> 00:31:28.319
And then the client is abandoned, right? They're
00:31:28.319 --> 00:31:31.059
sitting there saying, I can't do the work. That's
00:31:31.059 --> 00:31:34.160
a problem. If sometimes these types of issues
00:31:34.160 --> 00:31:37.420
come up, at the very end of the matter and these
00:31:37.420 --> 00:31:39.819
issues can get a little sticky, but you as the
00:31:39.819 --> 00:31:42.140
lawyer want to have the retainer agreement teed
00:31:42.140 --> 00:31:44.579
up and drafted in a way that it's been clear
00:31:44.579 --> 00:31:48.059
from the outset as to when you as the lawyer
00:31:48.059 --> 00:31:49.900
can withdraw and get out of the representation.
00:31:50.259 --> 00:31:52.859
If you don't have anything like that, it's not
00:31:52.859 --> 00:31:55.380
that you can't withdraw. Of course you can, but
00:31:55.380 --> 00:31:57.960
it's just better to have it clearly identified
00:31:57.960 --> 00:32:00.839
and the client has signed a document noting that
00:32:00.839 --> 00:32:03.039
I've read when the lawyer can withdraw from the
00:32:03.039 --> 00:32:06.319
representation because you Oftentimes, if you're
00:32:06.319 --> 00:32:08.599
representing a new client, you don't know that
00:32:08.599 --> 00:32:11.019
person. You think things are going to go fine.
00:32:11.079 --> 00:32:13.259
You hope everything is going to go great. But
00:32:13.259 --> 00:32:15.779
then they stop listening to you and taking your
00:32:15.779 --> 00:32:19.200
advice or demanding that you do things that are
00:32:19.200 --> 00:32:21.740
against either the strategy that you believe
00:32:21.740 --> 00:32:23.900
is in the best interest of the client or any
00:32:23.900 --> 00:32:25.980
other myriad of reasons, and you want to get
00:32:25.980 --> 00:32:30.299
out. So that's really important to have this
00:32:30.299 --> 00:32:33.039
just clearly outlined so the client knows what
00:32:33.039 --> 00:32:36.000
their rights are. if this circumstance were to
00:32:36.000 --> 00:32:41.440
come up. This is a thing that I didn't use to
00:32:41.440 --> 00:32:45.259
see at all. And now I'm seeing quite a bit. And
00:32:45.259 --> 00:32:48.099
I think it's because lawyers are trying to characterize
00:32:48.099 --> 00:32:51.539
advanced fees as retainers and aren't necessarily
00:32:51.539 --> 00:32:54.059
doing it right. And this is one that comes up
00:32:54.059 --> 00:32:56.380
more in transactional settings than otherwise.
00:32:57.599 --> 00:32:59.960
First and foremost, if you get an advanced fee,
00:33:00.279 --> 00:33:04.190
it is not it can never be non -refundable, okay?
00:33:04.670 --> 00:33:08.670
And if you haven't earned that fee when the representation
00:33:08.670 --> 00:33:11.410
ends, you are likely going to have to refund
00:33:11.410 --> 00:33:13.910
the balance of the unearned portion of the fees.
00:33:14.289 --> 00:33:16.869
If you don't keep track of your time, that can
00:33:16.869 --> 00:33:21.670
become a more difficult issue and you're gonna
00:33:21.670 --> 00:33:26.359
want to... Avoid that at all costs. So the only
00:33:26.359 --> 00:33:29.220
time that you can have a true retainer and these
00:33:29.220 --> 00:33:33.579
are rarer and rarer is if the Client is paying
00:33:33.579 --> 00:33:37.960
for your availability At at will right like they
00:33:37.960 --> 00:33:40.519
can call you that you're available. You're jumping
00:33:40.519 --> 00:33:43.019
on a plane You're doing something and I'm retaining
00:33:43.019 --> 00:33:47.059
that access. I don't see that very often and
00:33:47.059 --> 00:33:51.299
so That's can be a real problem And again, I
00:33:51.299 --> 00:33:53.680
don't know why these are coming up. But again,
00:33:53.940 --> 00:33:56.619
because of that, I added this slide to note to
00:33:56.619 --> 00:33:58.680
all of you that if you get advance fees from
00:33:58.680 --> 00:34:01.579
a client, keep it in your trust account. As you
00:34:01.579 --> 00:34:04.680
earn that fee, withdraw it from the trust account.
00:34:05.019 --> 00:34:07.160
But the safest place for that money for your
00:34:07.160 --> 00:34:09.179
benefit and the client's benefit is for it to
00:34:09.179 --> 00:34:11.400
sit in the trust account until you've earned
00:34:11.400 --> 00:34:15.739
that. And when you do, you should have your invoices
00:34:15.739 --> 00:34:18.940
reflect the hours or whatever work was done to
00:34:18.940 --> 00:34:21.940
point out the fee's been earned and you can take
00:34:21.940 --> 00:34:26.360
it out. Let me just try to hit a couple more
00:34:26.360 --> 00:34:30.400
questions here. Arbitration provisions I'll get
00:34:30.400 --> 00:34:41.079
to, don't worry about that. I would not, pre
00:34:41.079 --> 00:34:44.059
-authorizing settlement should not be a thing
00:34:44.059 --> 00:34:47.559
if I'm following that question. A client can't
00:34:47.559 --> 00:34:49.809
authorize a settlement when they don't know the
00:34:49.809 --> 00:34:51.989
number, even if it's a hypothetical, I don't
00:34:51.989 --> 00:34:54.010
think that's informed consent. I would stay away
00:34:54.010 --> 00:35:02.590
from that. Jennifer's question regarding settling
00:35:02.590 --> 00:35:07.650
out from under the agreement. So you're correct,
00:35:07.929 --> 00:35:11.650
yes. If the settlement, sorry, I don't know if
00:35:11.650 --> 00:35:13.389
everyone can even see these questions, but the
00:35:13.389 --> 00:35:15.380
question is, The client may not settle without
00:35:15.380 --> 00:35:17.260
the attorney. Isn't it intended to indicate that
00:35:17.260 --> 00:35:19.480
the client shall not communicate on the side
00:35:19.480 --> 00:35:21.440
with the other side and settle out from under
00:35:21.440 --> 00:35:23.559
the agreement without the attorney, or excuse
00:35:23.559 --> 00:35:26.079
me, with the attorney? Yes and no. Number one,
00:35:26.079 --> 00:35:27.820
I don't think you can prevent your client from
00:35:27.820 --> 00:35:29.599
communicating with the other side if they want
00:35:29.599 --> 00:35:32.940
to communicate from the other side. I've never
00:35:32.940 --> 00:35:34.780
seen that provision and also you can't prevent
00:35:34.780 --> 00:35:38.760
that. Clients can discharge you and then settle
00:35:38.760 --> 00:35:42.460
out from under you and then you have a number
00:35:42.460 --> 00:35:45.260
of rights and likely would be able to get your
00:35:45.260 --> 00:35:47.900
full contingency fee based on the question. I'm
00:35:47.900 --> 00:35:51.079
assuming that's a contingency fee issue. And
00:35:51.079 --> 00:35:53.699
it would either be on quantum Marowitt or another
00:35:53.699 --> 00:35:55.960
basis. And if it's quantum Marowitt and you've
00:35:55.960 --> 00:35:58.260
done all the work to get the settlement, I've
00:35:58.260 --> 00:36:00.559
resolved cases where the full fee is obtained
00:36:00.559 --> 00:36:02.699
for the law firm based on the work that was done.
00:36:02.860 --> 00:36:04.940
And that happens quite often with clients who
00:36:04.940 --> 00:36:07.559
try to get out from paying their lawyer, fire
00:36:07.559 --> 00:36:10.460
the lawyer on the courthouse steps and settle
00:36:10.460 --> 00:36:13.519
around and try to keep the fee. It's never worked
00:36:13.519 --> 00:36:15.900
in matters that we've handled, but it does end
00:36:15.900 --> 00:36:18.119
up costing the lawyer a little bit of money.
00:36:19.599 --> 00:36:24.619
Okay. Can the attorney require the client to
00:36:24.619 --> 00:36:27.010
consult? with an attorney before accepting a
00:36:27.010 --> 00:36:29.570
settlement, you certainly can do that. That would
00:36:29.570 --> 00:36:32.650
be an absolute best practice. It's not necessary
00:36:32.650 --> 00:36:35.889
at all. As long as you've conveyed the good and
00:36:35.889 --> 00:36:37.650
the bad of the settlement, I don't believe you
00:36:37.650 --> 00:36:40.429
as a lawyer need to recommend a settlement or
00:36:40.429 --> 00:36:42.969
recommend a settlement be rejected. Your job
00:36:42.969 --> 00:36:46.860
as a lawyer is to outline the scenarios of accepting
00:36:46.860 --> 00:36:49.679
or rejecting a possible settlement. And if they
00:36:49.679 --> 00:36:51.940
ask you, you can make recommendations. But I
00:36:51.940 --> 00:36:53.860
don't think you need to step into that world
00:36:53.860 --> 00:36:57.980
of making recommendations. I've had cases revolving
00:36:57.980 --> 00:37:00.420
around recommending and not recommending settlements.
00:37:00.519 --> 00:37:02.900
And I think, again, it's not something you need
00:37:02.900 --> 00:37:04.300
to do. And it's certainly not something you need
00:37:04.300 --> 00:37:10.380
to have in your retainer agreement. OK, let me
00:37:10.380 --> 00:37:14.929
jump back in here. Keeping a credit card on file
00:37:14.929 --> 00:37:17.550
advisable. That's more of a collection issue
00:37:17.550 --> 00:37:20.949
if you're to if you're Accepting fees via credit
00:37:20.949 --> 00:37:23.909
card. You can certainly Keep it on file. But
00:37:23.909 --> 00:37:27.110
if they don't they really should be authorizing
00:37:27.110 --> 00:37:29.250
that payment each month I don't think you can
00:37:29.250 --> 00:37:31.309
issue an invoice and then just charge the credit
00:37:31.309 --> 00:37:33.690
card because your clients generally have the
00:37:33.690 --> 00:37:36.389
right to dispute your fees and if Each month
00:37:36.389 --> 00:37:38.070
and so if you're just charging that could be
00:37:38.070 --> 00:37:40.949
a little bit of an issue If I hope I answered
00:37:40.949 --> 00:37:43.519
that question, so Let me pop back in here to
00:37:43.519 --> 00:37:46.460
where we left off. And again, I'll do my best
00:37:46.460 --> 00:37:59.639
to track additional questions. All right. The
00:37:59.639 --> 00:38:04.000
other thing that we see here is withholding client
00:38:04.000 --> 00:38:10.679
files. You really cannot do it. When the representation
00:38:10.679 --> 00:38:14.539
ends, the client's file is their property, other
00:38:14.539 --> 00:38:17.619
than your work product. You can keep your work
00:38:17.619 --> 00:38:20.000
product behind, but once litigation ensues, if
00:38:20.000 --> 00:38:21.920
you were to be a defendant in a legal malpractice
00:38:21.920 --> 00:38:24.059
case, your work product's generally going to
00:38:24.059 --> 00:38:26.739
get turned over as well. But for purposes of
00:38:26.739 --> 00:38:29.719
the client file, if there's a demand that's made
00:38:29.719 --> 00:38:32.280
for it, they're entitled to the original file
00:38:32.280 --> 00:38:34.809
at the end of the representation. this day and
00:38:34.809 --> 00:38:36.849
age original file has become a little bit of
00:38:36.849 --> 00:38:40.170
a difficult thing to understand because paper
00:38:40.170 --> 00:38:43.349
files don't necessarily exist anymore. So it's
00:38:43.349 --> 00:38:46.170
really just your digital file on whatever software
00:38:46.170 --> 00:38:49.150
you're using, iManage or whatever it might be.
00:38:49.449 --> 00:38:51.409
If you're gonna produce your original file to
00:38:51.409 --> 00:38:54.090
your client, be based on their demand, make sure
00:38:54.090 --> 00:38:56.550
you make a copy of it. So for yourself, a lot
00:38:56.550 --> 00:38:58.630
of lawyers turn it over and then they don't keep
00:38:58.630 --> 00:39:01.010
a copy for themselves. And then the original
00:39:01.010 --> 00:39:03.550
file obviously can become tampered with down
00:39:03.550 --> 00:39:08.969
the line and create issues for a subsequent representation.
00:39:10.659 --> 00:39:13.179
Just this is kind of just a very straightforward
00:39:13.179 --> 00:39:17.019
one You also if they haven't paid you you can't
00:39:17.019 --> 00:39:19.159
say I'm not going to turn over your file As soon
00:39:19.159 --> 00:39:21.780
as the demands made you have a reasonable time
00:39:21.780 --> 00:39:24.039
to to provide the file depending on the size
00:39:24.039 --> 00:39:27.559
of the file a reasonable time obviously can differ
00:39:27.559 --> 00:39:29.900
you certainly don't have to do it the next day
00:39:29.900 --> 00:39:33.300
or even the day after You have a reasonable amount
00:39:33.300 --> 00:39:36.099
of time to prepare it and provide it to the client
00:39:38.639 --> 00:39:42.219
So in relation to referral fees, which I'm a
00:39:42.219 --> 00:39:44.619
big fan of referral fees. I think it's a great
00:39:44.619 --> 00:39:50.159
part of in California we can have and we can
00:39:50.159 --> 00:39:54.159
get and and Pay pure referral fees. You don't
00:39:54.159 --> 00:39:56.380
actually have to do work on the case in order
00:39:56.380 --> 00:40:00.280
to get the referral fee But you've really got
00:40:00.280 --> 00:40:04.000
to comply with some basic rules otherwise your
00:40:04.000 --> 00:40:08.510
referral fee agreement it can be voided and This
00:40:08.510 --> 00:40:11.670
isn't necessarily just a client attorney issue
00:40:11.670 --> 00:40:15.150
This can be a lawyer to lawyer issue and quite
00:40:15.150 --> 00:40:18.289
often the disputes that we deal with Aren't lawyer
00:40:18.289 --> 00:40:21.210
client. They are lawyer lawyer, right? It's a
00:40:21.210 --> 00:40:25.130
lawyer refusing to pay a referral fee and oftentimes
00:40:25.130 --> 00:40:30.409
using as a sword rule 1 .5 .1 because it wasn't
00:40:30.409 --> 00:40:34.380
complied with and courts generally have zero
00:40:34.380 --> 00:40:37.539
sympathy for lawyers who fail to comply with
00:40:37.539 --> 00:40:41.480
rule 1 .5 .1 in relation to getting a referral
00:40:41.480 --> 00:40:44.280
fee by and large because it has nothing to do
00:40:44.280 --> 00:40:46.860
with the client's recovery. And so if you didn't
00:40:46.860 --> 00:40:51.119
comply with the rules, you're jeopardizing your
00:40:51.119 --> 00:40:54.619
referral fee. So number one, and I am gonna kind
00:40:54.619 --> 00:40:56.340
of walk through this because it's very, very
00:40:56.340 --> 00:40:59.019
important, the client's informed written consent
00:40:59.019 --> 00:41:03.530
is extremely important. And if you don't get
00:41:03.530 --> 00:41:05.269
it, your referral fee is not going to be able
00:41:05.269 --> 00:41:08.989
to be paid. And it has to be done at the time
00:41:08.989 --> 00:41:12.869
the referral agreement is executed. There's case
00:41:12.869 --> 00:41:16.610
law on point where the client executed the referral
00:41:16.610 --> 00:41:20.010
fee agreement months or years later. They didn't
00:41:20.010 --> 00:41:22.730
object to it. They just did it too late. And
00:41:22.730 --> 00:41:24.769
the court held that the referral fee agreement
00:41:24.769 --> 00:41:27.050
that the lawyer was trying to enforce was not
00:41:27.050 --> 00:41:29.409
enforceable because the informed written consent
00:41:29.409 --> 00:41:32.190
wasn't at or near the time the referral was agreed
00:41:32.190 --> 00:41:34.730
to. You've got to identify the division that's
00:41:34.730 --> 00:41:37.289
made. You've got to obviously identify the lawyers.
00:41:37.670 --> 00:41:40.090
You've got to disclose that the client's fee,
00:41:40.250 --> 00:41:42.550
the client's portion of the settlement is not
00:41:42.550 --> 00:41:44.650
going to be negatively impacted. They're not
00:41:44.650 --> 00:41:47.309
receiving less money because of this referral.
00:41:48.920 --> 00:41:53.300
that both lawyers execute the document. Another
00:41:53.300 --> 00:41:55.639
issue that I see with referral fees, and this
00:41:55.639 --> 00:41:59.199
happens to come into play more often on the plaintiff's
00:41:59.199 --> 00:42:02.539
PI catastrophic injury side, is the referral
00:42:02.539 --> 00:42:06.099
fee agreement is contained in the retainer agreement.
00:42:06.760 --> 00:42:09.860
The reason why that is problematic is because
00:42:09.860 --> 00:42:12.460
the retainer agreement can be voided for a number
00:42:12.460 --> 00:42:15.059
of reasons. And if you void the retainer agreement,
00:42:15.300 --> 00:42:19.809
you're very likely also voiding the 1 .5 .1 agreement
00:42:19.809 --> 00:42:24.469
so best practice in this area is to have a standalone
00:42:24.469 --> 00:42:29.449
One -page document that is its own contract That's
00:42:29.449 --> 00:42:31.909
not tied to any retainer agreement or whether
00:42:31.909 --> 00:42:34.250
you're doing work for that client anymore or
00:42:34.250 --> 00:42:37.010
whether you've been discharged And it's a nice
00:42:37.010 --> 00:42:39.650
clean document that exists and when that settlement
00:42:39.650 --> 00:42:43.929
Comes in you pull it out and you demand the referral
00:42:43.929 --> 00:42:47.239
fee and you shouldn't have any any issues with
00:42:47.239 --> 00:42:52.099
that. So this is a really important rule to comply
00:42:52.099 --> 00:42:56.699
with and a separate document to execute if you're
00:42:56.699 --> 00:43:00.079
in the world of paying or receiving referral
00:43:00.079 --> 00:43:06.340
fees. See how we're doing here. Does production
00:43:06.340 --> 00:43:10.090
of a file Include email communications you had
00:43:10.090 --> 00:43:12.730
with opposing counsel. I would say yes, it does.
00:43:12.750 --> 00:43:15.769
It doesn't include internal emails or memos.
00:43:15.769 --> 00:43:17.989
Again, that's going to be work product, but the
00:43:17.989 --> 00:43:20.469
client file is going to be defined to include
00:43:20.469 --> 00:43:27.349
that. You can put a shorter retention period,
00:43:27.349 --> 00:43:31.489
but you definitely don't want it to be with like
00:43:31.489 --> 00:43:33.789
a year or something like that. You have an obligation
00:43:33.789 --> 00:43:36.909
to maintain the client file for a period of time.
00:43:37.480 --> 00:43:48.920
Sorry, one other question here. Are there standards
00:43:48.920 --> 00:43:51.260
for referrals of hourly rate cases? It's gonna
00:43:51.260 --> 00:43:54.519
be rule 1 .5 .1. So if you referred an hourly
00:43:54.519 --> 00:43:58.219
case and you're getting, I don't know, 15 % of
00:43:58.219 --> 00:44:01.880
the total at the end of the case, or whenever
00:44:01.880 --> 00:44:04.019
you break that down, You're just going to have
00:44:04.019 --> 00:44:07.460
to comply with rule 1 .5 .1. Referral fees certainly
00:44:07.460 --> 00:44:12.099
can be dealt with in hourly cases just like they
00:44:12.099 --> 00:44:13.880
can in contingency. They're just more common
00:44:13.880 --> 00:44:16.320
in contingency fee cases. I have not dealt with
00:44:16.320 --> 00:44:20.760
a case regarding an hourly referral fee gone
00:44:20.760 --> 00:44:27.840
wrong. All right. Oops. Excuse me. OK. So this
00:44:27.840 --> 00:44:30.559
is an issue that comes up from time to time,
00:44:30.679 --> 00:44:34.780
which is the insurance disclosure. This is a
00:44:34.780 --> 00:44:38.599
newer rule. If you don't have insurance, California
00:44:38.599 --> 00:44:41.199
is one of the fewer states that you can provide
00:44:41.199 --> 00:44:44.039
professional legal services in without carrying
00:44:44.039 --> 00:44:46.739
professional liability insurance. I hope all
00:44:46.739 --> 00:44:49.760
of you listening to this have insurance, even
00:44:49.760 --> 00:44:52.139
if it's $100 ,000 through Lawyers Mutual, who
00:44:52.139 --> 00:44:54.800
sponsors these programs. Great company. I highly
00:44:54.800 --> 00:44:58.099
recommend you use them. And I highly recommend
00:44:58.099 --> 00:45:00.260
you have insurance because if you don't have
00:45:00.260 --> 00:45:05.039
insurance, uh being sued uh is becomes very expensive
00:45:05.039 --> 00:45:08.139
very quickly and if you have insurance this is
00:45:08.139 --> 00:45:11.699
a little bit stepping aside from uh retainer
00:45:11.699 --> 00:45:14.659
agreements if you have insurance make sure number
00:45:14.659 --> 00:45:18.280
one you report all potential claims uh at the
00:45:18.280 --> 00:45:20.559
time of your application i have had a number
00:45:20.559 --> 00:45:23.219
of people come to me who've been denied because
00:45:23.219 --> 00:45:26.360
they failed to disclose a potential claim a potential
00:45:26.360 --> 00:45:31.940
claim is i lost at trial the client was mad That
00:45:31.940 --> 00:45:34.619
is how loosely an insurance company is going
00:45:34.619 --> 00:45:37.659
to view that and looking to deny coverage because
00:45:37.659 --> 00:45:40.539
you failed to disclose a potential claim on your
00:45:40.539 --> 00:45:42.500
application. The other thing that's important
00:45:42.500 --> 00:45:45.079
is if you have insurance, is to timely tender
00:45:45.079 --> 00:45:47.460
the claim. We've had a number of cases where
00:45:47.460 --> 00:45:49.460
lawyers come to us because they got denied because
00:45:49.460 --> 00:45:51.440
they didn't timely tender the claim. They thought
00:45:51.440 --> 00:45:53.199
they'd handle it themselves. They thought it
00:45:53.199 --> 00:45:55.539
would go away. Next thing you know, it's a year.
00:45:55.639 --> 00:45:58.449
And next thing you know, they get denied. pay
00:45:58.449 --> 00:46:01.309
money for this product, use it. If you don't
00:46:01.309 --> 00:46:05.449
have it, you need to have this disclosure in
00:46:05.449 --> 00:46:10.409
play. And if it lapses, you need to notify your
00:46:10.409 --> 00:46:14.469
clients right away. So this is, I think, a rule
00:46:14.469 --> 00:46:17.170
that comes into play, certainly for sole practitioners
00:46:17.170 --> 00:46:19.929
who are out there. And again, if this is something
00:46:19.929 --> 00:46:21.869
you're going to do, it is against everything
00:46:21.869 --> 00:46:24.949
that I advise to practice without insurance.
00:46:25.239 --> 00:46:27.480
But this is something you have to put in your
00:46:27.480 --> 00:46:30.519
retainer agreement. And I've seen it in various
00:46:30.519 --> 00:46:34.920
retainer agreements along the way. So the next
00:46:34.920 --> 00:46:38.800
thing I want to discuss, which is it's an older
00:46:38.800 --> 00:46:43.139
case now. This was the biggest case of the time
00:46:43.139 --> 00:46:47.619
regarding conflict of interest, advanced conflict
00:46:47.619 --> 00:46:52.369
waiver deemed to be unenforceable. And I've given
00:46:52.369 --> 00:46:55.170
a number of seminars on this case and we could
00:46:55.170 --> 00:46:57.949
talk for at least an hour about it and the implications
00:46:57.949 --> 00:47:01.550
of it. But it's really important to know here
00:47:01.550 --> 00:47:04.130
because it really touches on quantum marowit
00:47:04.130 --> 00:47:07.409
and the guidelines as to how that's going to
00:47:07.409 --> 00:47:10.670
be treated and it gets applied oftentimes when
00:47:10.940 --> 00:47:13.940
retainer agreements get voided, and you're stuck
00:47:13.940 --> 00:47:16.679
now getting in the world of quantum marijuana.
00:47:16.960 --> 00:47:19.179
So if you haven't read the Shepard -Mullen case,
00:47:19.639 --> 00:47:22.500
you should read it. There's just a very high
00:47:22.500 --> 00:47:26.000
level bullet point summary of what it covers.
00:47:27.119 --> 00:47:30.320
But again, the main takeaway is don't ever have
00:47:30.320 --> 00:47:33.340
an advanced conflict waiver, because they're
00:47:33.340 --> 00:47:36.099
generally going to be... unless it's very specific.
00:47:36.679 --> 00:47:38.559
And then as your conflict changes and evolves
00:47:38.559 --> 00:47:40.659
over time, you may need to update that conflict
00:47:40.659 --> 00:47:43.159
waiver when the actual conflict arises. So you
00:47:43.159 --> 00:47:45.119
have your conflict waiver at the start, and then
00:47:45.119 --> 00:47:49.940
you're going to modify it. So again, this is
00:47:49.940 --> 00:47:52.440
the case that's going to void a lot of agreements,
00:47:52.460 --> 00:47:55.719
and you should know and be familiar with it.
00:47:56.099 --> 00:47:59.699
That said, it does allow quantum error recovery.
00:47:59.820 --> 00:48:05.670
And I talked about quantum error a lot. And the
00:48:05.670 --> 00:48:08.389
case law is pretty clear that even if the violations
00:48:08.389 --> 00:48:11.610
are severe, whether it be the rules of professional
00:48:11.610 --> 00:48:13.929
conduct, the Business and Professionals Code,
00:48:14.010 --> 00:48:17.110
or just California case law, lawyers are entitled
00:48:17.110 --> 00:48:21.210
to get their quantum arrow in, but there are
00:48:21.210 --> 00:48:23.730
gonna be things that are going to take away from
00:48:23.730 --> 00:48:27.300
it. And these factors that are listed here, are
00:48:27.300 --> 00:48:29.079
the issues that are going to come up that you're
00:48:29.079 --> 00:48:31.199
going to be dealing with if you're in the world
00:48:31.199 --> 00:48:34.320
of quantum heroin. And quantum heroin comes up
00:48:34.320 --> 00:48:38.199
all the time. Once you're a defendant in a legal
00:48:38.199 --> 00:48:41.159
malpractice case, if you have a cross complaint
00:48:41.159 --> 00:48:45.539
for fees, it just comes up a lot. And so you
00:48:45.539 --> 00:48:48.739
really want to be careful if you did happen to
00:48:48.739 --> 00:48:50.940
take advantage of your client or you were just
00:48:50.940 --> 00:48:53.420
had your pedal to the metal and were billing
00:48:53.420 --> 00:48:56.119
over billing. these are the issues that are going
00:48:56.119 --> 00:48:58.219
to take away from quantum arrow it and certainly
00:48:58.219 --> 00:49:01.519
the more serious the ethical violations, the
00:49:01.519 --> 00:49:04.659
more serious the conduct, the more willful the
00:49:04.659 --> 00:49:07.300
billing discrepancies are, the less likely it
00:49:07.300 --> 00:49:09.760
is that you're going to get the full value of
00:49:09.760 --> 00:49:12.440
the services. And again, as I noted at the outset,
00:49:12.460 --> 00:49:17.440
that sort of starts with the hourly rate. Let
00:49:17.440 --> 00:49:27.219
me just pop back to our questions here. Okay,
00:49:27.380 --> 00:49:29.500
text messages, are they part of the client file?
00:49:29.980 --> 00:49:32.920
I would argue they would be. I would also argue
00:49:32.920 --> 00:49:36.059
that, or argue, I would also tell you, as the
00:49:36.059 --> 00:49:37.880
question points out, can an attorney inform the
00:49:37.880 --> 00:49:40.219
client not to communicate substantively by text?
00:49:40.900 --> 00:49:43.360
Absolutely. I don't think communicating by text
00:49:43.360 --> 00:49:48.659
is a smart thing to do other than for routine
00:49:48.659 --> 00:49:51.840
tasks, dates, scheduling, things like that. But
00:49:51.840 --> 00:49:53.739
if you're communicating settlement offers with
00:49:53.739 --> 00:49:56.300
your client, I don't think that's smart, because
00:49:56.300 --> 00:49:59.840
as we all know when we text, we talk very casually
00:49:59.840 --> 00:50:04.320
via text. We abbreviate. There's nuance. If you
00:50:04.320 --> 00:50:07.420
throw in an emoji, it gets even worse. You just
00:50:07.420 --> 00:50:09.539
don't want to be communicating about anything
00:50:09.539 --> 00:50:13.480
serious via text message. If you have less sophisticated
00:50:13.480 --> 00:50:17.239
clients, that can become more difficult. So if
00:50:17.239 --> 00:50:19.920
you are going to communicate via text, and certainly
00:50:19.920 --> 00:50:23.769
you can do it, just remember that You need you're
00:50:23.769 --> 00:50:25.570
the lawyer, right? You're not their friend and
00:50:25.570 --> 00:50:28.309
you need to do it formally Send a text like you
00:50:28.309 --> 00:50:31.690
would send an email so it's clear and there's
00:50:31.690 --> 00:50:34.869
no vague Content in there regarding whatever
00:50:34.869 --> 00:50:38.590
important issue there is Okay, let me jump back
00:50:38.590 --> 00:50:40.110
to the presentation here because I'm running
00:50:40.110 --> 00:50:42.289
a little light on time and again I'll answer
00:50:42.289 --> 00:50:48.730
any questions after the presentation Okay So
00:50:48.730 --> 00:50:53.460
this is an issue that's coming into play, which
00:50:53.460 --> 00:50:59.239
is fees that aren't necessarily contingency fees
00:50:59.239 --> 00:51:02.840
regarding these business and professions codes.
00:51:02.880 --> 00:51:05.500
So this is something to just kind of keep your
00:51:05.500 --> 00:51:09.000
eye on depending on if you handle non -litigation
00:51:09.000 --> 00:51:13.599
matters, whether or not business and professions
00:51:13.599 --> 00:51:19.010
code 6147 is going to apply. And we see words
00:51:19.010 --> 00:51:20.590
in retainer agreements, as you can see here,
00:51:20.809 --> 00:51:24.409
like hold back or bonus based on a deal, right?
00:51:24.530 --> 00:51:27.809
If you're getting pieces of the action, A, you're
00:51:27.809 --> 00:51:30.250
going to have conflict issues. But the question
00:51:30.250 --> 00:51:32.210
is going to come up of whether this is more like
00:51:32.210 --> 00:51:35.849
a contingency fee agreement versus something
00:51:35.849 --> 00:51:38.449
that was hourly. You certainly can weave these
00:51:38.449 --> 00:51:41.530
components into an hourly fee agreement if you
00:51:41.530 --> 00:51:43.630
get a kicker at the back end regarding something.
00:51:43.869 --> 00:51:45.789
There just needs to be informed written consent,
00:51:45.789 --> 00:51:48.190
and you just need to make sure that you need
00:51:48.190 --> 00:51:52.469
to comply with the rules. So this is just an
00:51:52.469 --> 00:51:55.309
issue that's coming up that you should understand,
00:51:55.409 --> 00:51:59.670
depending on your practice group. And forgive
00:51:59.670 --> 00:52:01.929
me, I'm kind of going a little fast here towards
00:52:01.929 --> 00:52:05.650
the end just to make sure we get into a couple
00:52:05.650 --> 00:52:09.309
other issues. OK, so these, I believe we've kind
00:52:09.309 --> 00:52:12.900
of discussed this, but this is really The quick
00:52:12.900 --> 00:52:15.920
settlement slide. I'm going to move on from it.
00:52:16.340 --> 00:52:19.980
You just need to understand that other states
00:52:19.980 --> 00:52:23.159
are taking a harder position with respect to
00:52:23.159 --> 00:52:26.400
quick quick settlements and the state bar has
00:52:26.400 --> 00:52:29.360
recognized that other states are doing this so
00:52:29.360 --> 00:52:32.079
they may start to do it and the state bar may
00:52:32.079 --> 00:52:34.739
take one view of something and the California
00:52:34.739 --> 00:52:38.099
Superior Court may take another view of it. So
00:52:38.099 --> 00:52:41.039
if you're practicing in this field, just note
00:52:41.039 --> 00:52:44.219
that. things may change, but I think until a
00:52:44.219 --> 00:52:46.099
California published decision comes out on the
00:52:46.099 --> 00:52:48.000
topic, there's not going to be any issue for
00:52:48.000 --> 00:52:52.559
you. So these are block bill entries and issues
00:52:52.559 --> 00:52:57.159
that we see with the bills themselves and something
00:52:57.159 --> 00:52:59.659
that you're going to see if you look at the bad,
00:52:59.760 --> 00:53:02.480
the red slide there, which we see all the time.
00:53:02.519 --> 00:53:04.920
If you're putting commas in your bills on the
00:53:04.920 --> 00:53:07.260
transactional side or litigation side, it's bad
00:53:07.260 --> 00:53:11.639
practice. Is it Malpractice? No, it's just something
00:53:11.639 --> 00:53:14.599
you should avoid because the same task should
00:53:14.599 --> 00:53:18.380
be separated so that you can see the task, it's
00:53:18.380 --> 00:53:22.059
identified, there's more specificity, and a very
00:53:22.059 --> 00:53:24.579
qualified expert is going to have no problem
00:53:24.579 --> 00:53:28.500
slashing that 5 .5 hours down to 1 .5 hours because
00:53:28.500 --> 00:53:31.179
you just can't tell what was done there and which
00:53:31.179 --> 00:53:34.820
one of those tasks took which amount of time.
00:53:35.539 --> 00:53:39.389
And so best practice here to... Allow you to
00:53:39.389 --> 00:53:41.809
keep your money when you've got that receivable
00:53:41.809 --> 00:53:43.829
and you're filing that cross complain You're
00:53:43.829 --> 00:53:45.730
filing that complaint for fees or your in fee
00:53:45.730 --> 00:53:48.449
arbitration is to have your bills look like this.
00:53:48.530 --> 00:53:52.269
Is it more time -consuming? Absolutely. Are your
00:53:52.269 --> 00:53:55.130
associates gonna give you grief about it? Absolutely,
00:53:55.489 --> 00:53:58.329
but this is the best practice and This is how
00:53:58.329 --> 00:54:02.949
you get your money. So if you're the managing
00:54:02.949 --> 00:54:05.969
partner or you're running your own shop and you're
00:54:05.969 --> 00:54:08.190
billing with commas and semicolons and things
00:54:08.190 --> 00:54:11.570
like that, you should try to avoid doing that
00:54:11.570 --> 00:54:13.769
because I think your bills will tell a cleaner
00:54:13.769 --> 00:54:17.130
story and the bills will be upheld and you'll
00:54:17.130 --> 00:54:22.170
be able to collect your money. Arbitration came
00:54:22.170 --> 00:54:26.949
up in some questions and I definitely want to
00:54:26.949 --> 00:54:31.800
touch upon. Two issues prevailing party fee clauses
00:54:31.800 --> 00:54:35.440
and arbitration clauses There is no one -size
00:54:35.440 --> 00:54:39.039
-fits -all here. It really depends on what you
00:54:39.039 --> 00:54:41.599
want to do I have clients who do not include
00:54:41.599 --> 00:54:44.139
prevailing party fee provisions for a number
00:54:44.139 --> 00:54:47.619
of reasons And it just comes down to whether
00:54:47.619 --> 00:54:50.900
you want one and whether you need one My firm
00:54:50.900 --> 00:54:53.800
generally does have a prevailing party fee provision.
00:54:54.139 --> 00:54:56.900
Obviously, you know the downside of that if you
00:54:56.900 --> 00:55:00.079
lose You're going to be paying fees if you win
00:55:00.079 --> 00:55:02.340
you can get fees the one thing that's important
00:55:02.340 --> 00:55:05.380
to consider I think above all is who are your
00:55:05.380 --> 00:55:09.920
clients and a and b Are you ever going to collect
00:55:09.920 --> 00:55:13.320
a dollar from them if you prevail? If you have
00:55:13.320 --> 00:55:16.320
a prevailing party fee provision and you represent
00:55:16.320 --> 00:55:20.099
individuals With potentially little to no means
00:55:20.099 --> 00:55:22.639
you are never going to collect that money. So
00:55:22.639 --> 00:55:25.920
why have it because if they win you likely have
00:55:25.929 --> 00:55:28.969
Potential money that's collectible if you represent
00:55:28.969 --> 00:55:31.510
big businesses, that's a different story, right?
00:55:31.610 --> 00:55:34.750
They're collectible and it might make sense But
00:55:34.750 --> 00:55:37.110
if you just have it because you've never thought
00:55:37.110 --> 00:55:40.130
about it. That's a bad approach. So you really
00:55:40.130 --> 00:55:44.690
want to think about Whether you want one in your
00:55:44.690 --> 00:55:46.309
retainer agreement and I think looking at it
00:55:46.309 --> 00:55:48.670
from the perspective of who your clients are
00:55:48.670 --> 00:55:52.679
Is the best way to go about it? The next issue
00:55:52.679 --> 00:55:54.579
here, and I know we're running out of time and
00:55:54.579 --> 00:56:00.400
this is the end, is arbitration. There used to
00:56:00.400 --> 00:56:04.940
be this common theme that arbitration was cheaper
00:56:04.940 --> 00:56:07.960
and it was quicker. And it used to be cheaper
00:56:07.960 --> 00:56:10.659
and it used to be quicker. That's not necessarily
00:56:10.659 --> 00:56:13.039
the case anymore. Depending on who your arbitrator
00:56:13.039 --> 00:56:16.199
is, it can be more expensive and it isn't necessarily
00:56:16.199 --> 00:56:19.659
going to be quicker. So again, it before just
00:56:19.659 --> 00:56:22.059
including an arbitration clause in your retainer
00:56:22.059 --> 00:56:25.460
agreement, think about A, do I really want this
00:56:25.460 --> 00:56:27.820
to be private? Do I need it to be private? Am
00:56:27.820 --> 00:56:30.360
I the type of lawyer that I just cannot have
00:56:30.360 --> 00:56:34.739
any public filing against me and period? That's
00:56:34.739 --> 00:56:37.920
the case. So be it. The downside of arbitration
00:56:37.920 --> 00:56:41.559
is the following. We have a tremendously high
00:56:41.559 --> 00:56:43.840
success rate at getting clients out on summary
00:56:43.840 --> 00:56:46.880
judgment motions, anti -slap motions and defense
00:56:46.880 --> 00:56:50.719
verdicts at trial. If you you don't get that
00:56:50.719 --> 00:56:53.380
in arbitration, okay You just don't get an msj
00:56:53.380 --> 00:56:55.860
It's not going to happen even a demur on a statute
00:56:55.860 --> 00:56:58.159
of limitations We get out doing any of those
00:56:58.159 --> 00:57:00.400
things with an arbitrator is extremely difficult
00:57:00.400 --> 00:57:04.079
Your case is going to be heard most likely on
00:57:04.079 --> 00:57:05.860
the merits and you're going to get a decision
00:57:05.860 --> 00:57:09.239
Certainly we prevail in arbitration quite often
00:57:09.239 --> 00:57:12.760
as well But we don't have as many weapons available
00:57:12.760 --> 00:57:15.480
to us. And then of course if things do go sideways
00:57:15.480 --> 00:57:18.780
in arbitration your right to appeal that decision
00:57:18.780 --> 00:57:22.380
is much more limited than it is in the superior
00:57:22.380 --> 00:57:27.380
court. So you really got away whether or not
00:57:27.380 --> 00:57:30.860
arbitration is important for your firm based
00:57:30.860 --> 00:57:35.360
on the various needs that it has. And so again,
00:57:35.500 --> 00:57:38.280
there's no one size fits all and it's a really
00:57:38.280 --> 00:57:41.449
complicated discussion versus the costs. And
00:57:41.449 --> 00:57:43.769
benefits because if you don't need it to be private,
00:57:44.030 --> 00:57:46.889
then honestly, it may not be that important to
00:57:46.889 --> 00:57:50.329
you. I have some insurance companies that tell
00:57:50.329 --> 00:57:53.440
their insurers. If you have an arbitration provision
00:57:53.440 --> 00:57:56.760
before you can invoke it, you have to get the
00:57:56.760 --> 00:57:59.699
permission of the insurance carrier because insurance
00:57:59.699 --> 00:58:02.900
carriers are pretty aware that they get good
00:58:02.900 --> 00:58:04.960
results in the superior court or federal court,
00:58:05.159 --> 00:58:07.920
wherever it might be, because of motions for
00:58:07.920 --> 00:58:11.039
summary judgment that attack causations and other
00:58:11.039 --> 00:58:14.079
things like that. And also, if you don't have
00:58:14.329 --> 00:58:16.949
a high insurance limit, let's say you have a
00:58:16.949 --> 00:58:19.690
half a million dollars, then you're going to
00:58:19.690 --> 00:58:22.090
run into an issue with respect to eroding limits
00:58:22.090 --> 00:58:27.050
because, again, a private arbitrator can unnecessarily
00:58:27.050 --> 00:58:30.989
cost money and erode the limits when it otherwise
00:58:30.989 --> 00:58:35.130
would. So I know that was a little bit quick,
00:58:35.150 --> 00:58:37.289
but those are generally the issues that come
00:58:37.289 --> 00:58:39.929
up with two hot topics, prevailing party fee
00:58:39.929 --> 00:58:43.159
clauses, and arbitration clauses. And I have
00:58:43.159 --> 00:58:46.719
clients go both ways on it, especially arbitration.
00:58:46.820 --> 00:58:49.559
And it is certainly for those same firms. It's
00:58:49.559 --> 00:58:53.579
a discussion that has evolved over time. So just
00:58:53.579 --> 00:58:56.719
lastly, we've touched on these pitfalls. This
00:58:56.719 --> 00:58:58.440
is kind of summarizing everything. And you're
00:58:58.440 --> 00:59:01.860
going to get these slides. So feel free to call
00:59:01.860 --> 00:59:05.519
or email me to discuss any of these issues. These
00:59:05.519 --> 00:59:11.300
are the key takeaways for all of you. And then
00:59:11.300 --> 00:59:14.360
lastly, if you have any issues, feel free to
00:59:14.360 --> 00:59:18.099
call or email me. And I think I cut it right
00:59:18.099 --> 00:59:18.599
on time.