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    Managing Risk: 10 Tips to Unbundle Legal Services

    Offering unbundled legal services can help attract clients who might be unable or unwilling to pay for legal services in tough economic times, but there are risks. Here are 10 best-practices tips when taking on limited scope representation.

    Thomas J. Watson

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    Wisconsin LawyerWisconsin Lawyer
    Vol. 83, No. 3, March 2010

    There have been many signs over the past year that the recession has affected the legal profession. From law firms downsizing to law school graduates having difficulty finding work, it is apparent the economy’s struggles have hit home for many lawyers. There is yet another sign that the practice of law is changing as a result of economic pressures: In my travels around the state this past year, I have spoken about many different risk-management issues, and the issue of unbundled legal services, or limited scope representation, has generated the most interest.

    From Sturgeon Bay to Waukesha, lawyers have told me they are seeing more clients interested in hiring them for only a part of their case. Milwaukee attorney Diane Diel says, “I get asked this question more and more frequently these days. I also see it more frequently. More of my clients want to spend more time talking about how to assure the best deal possible for the clients and secure ‘cut-rate’ legal services.”

    Limited scope representation is one way to close the justice gap as more people are unable or unwilling to pay for legal services in these difficult economic times. As unemployment rates rise, clients’ ability or willingness to pay for the legal services they need seems to be on the decline. Offering unbundled legal services can benefit lawyers and clients. As Milwaukee attorney Carlton Stansbury says, “If handled properly, [limited scope representation] increases access to the court system, promotes effective resolution of matters, and aids the court system in doing its work. From a business perspective, limited scope representation is less time consuming and has a 100 percent collection rate if done properly. From a lawyer image perspective, limited scope representation is more service oriented and clients perceive lawyers as counselors and an important source of information. Limited scope representation minimizes the legal profession’s image as professionals engaged in the practice to make money rather than to help people with their problems.”

    Thomas J. Watson

    Thomas J. Watson, Marquette 2002, is senior vice president and director of communications at Wisconsin Lawyers Mutual Insurance Co., Madison. Contact him at com Tom.Watson wilmic wilmic Tom.Watson com.

    So what’s not to like about offering unbundled legal services? It can help some people who otherwise would never hire a lawyer. And for lawyers, especially solo practitioners and small firms, it’s a way to bring business in the door that they otherwise might not get. Milwaukee attorney Margaret Hickey says, “This is particularly true in family law cases where clients may not be able to afford an attorney for all aspects of a case, but benefit greatly by help on parts of the case, such as a review of the final agreement or by assistance in placement disputes. Clients of limited means are interested in this type of representation as are parties facing economic challenges during this recession.”

    In a recent article in the ABA Journal, it was reported that 41 states have adopted the ABA model rule (or a variation of it) that allows lawyers to take only part of a case. Chief Justices John Broderick Jr. of New Hampshire and Ronald George of California wrote in the New York Times that “for those whose only option is to go it alone, at least some limited, affordable time with a lawyer is a valuable option we should all encourage.”

    But there are potential pitfalls, and lawyers should know them and pay attention to them.

    Proper Safeguards

    According to Tim Pierce, State Bar of Wisconsin ethics counsel, Wisconsin is one of the 41 states to have adopted at least part of the ABA Model Rule, and limited scope representation in Wisconsin is permitted by the Rules of Professional Conduct. SCR 20:1.2(c) reads as follows:

    “A lawyer may limit the scope of the representation if the limitation is reasonable under the circumstances and the client gives informed consent.”

    What does that mean? Pierce says it is the lawyer’s burden to determine whether the limitation is reasonable. “Assisting a party with forms or providing a brief consultation may suffice for a simple uncontested divorce, but may be unreasonable for a matter involving complicated marital property and tax issues.”

    As for informed consent, Pierce says to make sure you define the representation specifically, in writing, and get the client’s confirmation in writing as well. The Supreme Court Rules define informed consent as an “agreement by a person to a proposed course of conduct after the lawyer has communicated adequate information and explanation about the material risks and reasonably available alternatives to the proposed course of conduct.” Hickey, who has done some limited scope representation, says a good written fee agreement is critical. “This should define what the attorney will and will not do and disclose the pros and cons of the limited scope representation,” she says. (For more information on fee agreements, see “Stimulating Growth with Alternative Fee Arrangements” elsewhere in this issue.)

    Another danger of taking limited scope cases is failing to review the entire case, as you would if you were providing full representation in the matter. Stansbury believes the biggest pitfall is providing advice with limited information. “Limited scope cases are not an opportunity to pay less attention. Competency, diligence, and communication remain important considerations. And, the scope of the representation must be reasonable under the circumstances. A lawyer must evaluate fully whether the requested limited representation can be done without creating problems for the client, the court, and the lawyer’s reputation. There is no clear rule on what is reasonable, and each situation is unique. The best policy is to get out of the limited representation early if unforeseen problems become apparent.”

    Sally Anderson, vice president – claims at Wisconsin Lawyers Mutual Insurance Co., Madison, couldn’t agree more. She says some lawyers have been engaged in unbundled legal services for years, but many of them don’t realize it, and she has seen malpractice claims because of it. For example, she says, a lawyer may agree to help prepare some of the documents for a closing. Something then goes wrong at the closing (which the lawyer does not attend). “So who do you suppose the client is going to blame?” she asks. “They figure it has to be the lawyer’s fault, and now you have a malpractice claim on your hands.”

    And the claim may have some merit. A lawyer may have a duty to advise a client of relevant information, even if it falls outside the scope of a limited representation, and to advise the client to seek independent advice if appropriate. Although you should inform your client of the limitations of your representation, and you needn’t provide services beyond the agreed-on scope, you should alert your client to other relevant issues.

    When Limited Scope Becomes Full Scope

    Another danger to accepting a limited scope case is the ease with which the scope of the representation can expand. If you see that happening, you need a new written agreement. Do not exceed the scope of the representation defined in the original written agreement without drafting a new written agreement. Too many lawyers fall into this trap and end up working on parts of a case that they did not originally agree to take on. Stansbury says, “I am finding that many clients will start with a limited scope representation, then request that I undertake a full representation as the matter proceeds. I think that lawyers and parties viewed representation as ‘all or nothing’ for a long time, and now that limited representation is more common, parties are seeking it out as getting the help they need without committing to a business relationship that is more expensive, possibly more contentious, and more work than the client thinks he or she needs.”

    Hickey adds, “Clients have difficulty understanding where one issue ends and another issue begins. Therefore, it is easy to get pulled into related issues on which the attorney is not retained. It is important to remind the client that you are not retained for that issue or segment of the case. Sometimes, because we want to help our clients, we may do more than we originally signed up for. This could be a potential problem.”

    Going to Court

    What about representing a client in court, even if you have been hired for only one issue, or one hearing? Are judges amenable?

    Hickey says, “Limited appearances in court can work and judges do understand if the attorney states that he or she is handling only a part of the case. I expect that judges prefer that the client have some representation than none. The difficulty comes when the attorney must sit silent and the client handles part of the case that the attorney is not working on. Since the attorney is not retained for that part of the case, he or she must refrain from offering advice to the client and from speaking up in court. If asked questions, the attorney must decline to participate. If possible, the attorney should leave the courtroom for the part of the case that he or she is not handling.”

    But some judges may not be willing to accommodate a limited-appearance arrangement. Pierce says lawyers who appear on behalf of a client for limited purposes should inform the court of the scope of the representation. “Nonetheless,” he says, “should a court refuse to permit a lawyer to withdraw upon completion of the limited services, SCR 20:1.16(c) requires the lawyer to continue the representation to the extent ordered by the court.”

    Ghostwriting

    Ghostwriting refers to the practice of a lawyer drafting pleadings, briefs, or other documents filed with a court by a pro se party when the lawyer’s role in drafting the documents is not disclosed. There is disagreement among lawyers as to whether this practice is a good idea, let alone ethical. Even courts and ethics committees can’t seem to agree. Pierce says Wisconsin has yet to address the issue in either case law or ethics opinions. So how should a lawyer handle a request for assistance in drafting documents? Pierce says the ABA model rules do not require lawyers to reveal assistance, so he says it is unlikely a Wisconsin lawyer would face discipline for ghostwriting. However, he adds, “Given that the large weight of case law holds that a lawyer should disclose substantial assistance in the preparation of pleadings, I still think a lawyer would be wise to obtain the client’s consent to such a disclosure.”

    Conclusion

    The demand for limited scope representation appears to be on the rise, and such representation holds the potential to be greatly beneficial for both lawyers and clients. As Hickey says, “Not only does it provide assistance to clients in navigating the legal system at a reasonable price, it can also help in the administration of justice since cases may move faster or smoother due to legal assistance to the client.”

    But lawyers must be cautious, diligent, and thorough. With apologies to David Letterman, here is my list of top 10 best practices when taking on limited scope representation. Many of these apply to any type of representation, so apply them to your practice, whether you offer unbundled legal services or not.

    1. Use good judgment.
    2. Document your file.
    3. Put everything in writing.
    4. Educate your clients.
    5. Do not dabble in areas of law with which you are not familiar.
    6. Be wary of a client’s unrealistic expectations.
    7. Make sure the limitation on the scope of your services is reasonable.
    8. Draft good fee agreements.
    9. Use a checklist of tasks and responsibilities, so your client knows what work you will and will not be doing in the case.
    10. Write a new agreement if the scope of representation changes.   



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