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PLACIDUS AGUWA, ESQ., elected President of Nigerian Lawyers Association.

The Nigerian Lawyers Association (NLA), has elected our partner, Placidus Aguwa, Esq., as President for the 2005/2006 term. NLA, an association of attorneys based in the United States, held its annual general elections at Fordham Law School in New York, New York on Saturday, November 19, 2005. The NLA witnessed a record participation in the elections, with over 70% of its members voting in person or by proxy. At the event, outgoing President, Tinu Awe, thanked members of the association for the support they showed her during her term and promised to continue to be of service to NLA in her new role as a member of the Board of Directors.

On his part, the President-Elect, Placidus Aguwa, vowed to uphold the high standards set by Tinu Awe’s administration and the other past presidents of the association, namely John Edozie, Beatrice Hamza-Bassey, Shamsey Oloko, and Ben Okeke. The President-Elect is a lawyer in New York. He is a partner in the law firm of Placid & Emmanuel, a civil practice law firm. He has also served as Secretary and was a member of the NLA Board of Directors.

The NLA has always been very active in cultivating the science of jurisprudence and facilitating the administration of justice in the United States, Nigeria and elsewhere. In addition, the NLA serves the needs of members of the Nigerian legal community, as well as the Nigerian community as a whole, in their understanding of and access to the law.

Among other events and activities, the NLA holds periodic Continuing Legal Education, (CLE) seminars for lawyers. The association also conducts free legal clinics within the minority communities to assist individuals with various legal issues.

The swearing-in ceremony for the newly elected officers and directors was held on Friday, December 8, 2005, in Manhattan, New York City.

New law requires attorneys to give Letter of Engagement to new clients.

Letters of Engagement

By Patrick M. Connors
New York Law Journal
March 4, 2002

As of today, attorneys in New York State must comply with 22 NYCRR Part 1215, which require a written letter of engagement for representations. The rule was proposed in 2001 and met with strong opposition. The New York State Bar Association endorsed the use of letters of engagement as a "best practice," but concluded that a rule should not mandate the practice. The Appellate Divisions made several revisions to the proposed rule based on complaints and suggestions of the bar, but ultimately decided to join the small number of states that require written letters of engagement in virtually all types of representation.

This article will present an overview of the rule's application and note some of its troublesome points, with an emphasis on avoiding gray areas until those aspects of the rule become settled. Although many lawyers are unhappy with the rule, compliance with its provisions will help attorneys avoid malpractice and disputes with their clients.

The rule applies to situations where an attorney agrees to represent a client on or after March 4, 2002. The rule does not specifically address representations that commenced prior to the effective date, but it does not appear that a letter of engagement is required for those situations. Lawyers need to be careful here. Although the representation may have commenced prior to March 4, the scope of the representation and the tasks to be performed by the lawyer may be altered after that date. If the scope of the representation changes after March 4, the lawyer should treat it as a new representation covered by the written letter of engagement rule, unless "the attorney's services are of the same general kind as previously rendered to and paid for by the client."[1]

The rule covers both criminal and civil representations where the lawyer "enters into an arrangement for, charges or collects any fee from a client,"[2] subject to several exceptions. The rule's broad language covers representations where the fee is entirely contingent on the outcome of the matter or where an hourly fee is deducted from a retainer, and all other fee arrangements in between these two poles.
The rule is silent on an important issue, namely, the attorneys who are subject to its provisions. Obviously, the rule applies to a New York attorney representing a New York domiciliary or a New York corporation in a New York state court action. Does it also apply to an attorney who principally practices in New York, but agrees to represent a New Jersey domiciliary before a federal court in Ohio? New York lawyers should assume that it does until there's a clarification in the rule or through caselaw.[3] In this regard, the recently enacted Fee Dispute Resolution Program in Part 137, which is expressly referred to in Part 1215, applies "to all attorneys admitted to the bar of the State of New York who undertake to represent a client in a civil matter,"[4] unless "no material portion of the services was rendered in New York."[5]

When and How
The rule requires that the letter of engagement be provided to the client "before commencing the representation."[6] The letter can also be provided "within a reasonable time" after representation has commenced if it is "impracticable" to provide one sooner or "if the scope of the services to be provided cannot be determined at the time of the commencement of representation."[7] Lawyers should be hesitant to postpone the letter. Even if the entire scope of the services cannot be delineated at the outset of the representation, a rough outline should be provided, with an updated letter to follow.[8] This will not only assure compliance with the rule, but will help reduce exposure to malpractice liability for matters outside the scope of the agreed legal services.[9]

The rule is silent on "how" the letter of engagement should be provided to the client, but the careful lawyer will maintain proof that the client received it in the event the matter is later disputed. The rule does not require that the client sign it, but a signature by the client acknowledging receipt of the letter of engagement would certainly supply proof of compliance.[10] The signature also serves the additional purpose of providing an acknowledgment by the client of the fee to be charged, which could be important in a subsequent fee dispute.

Who Gets a Letter

The client is entitled to be provided with the letter of engagement, but at times there is a problem in identifying the client. The issue is of critical importance because the lawyer owes the duties of confidentiality and loyalty to the client and if one is mistaken as to the identity of the client, it can result in a breach of duty. For example, a lawyer representing an insured owes the duty of confidentiality to the insured and not to the insurance company paying the bill.[11]

The new rule adds some confusion to this area by stating that a "client shall include any person or entity that is responsible for the payment of the attorney's fees."[12] Therefore, although the insurer paying the lawyer's bill is generally not a client, it is a client for purposes of Part 1215 and is entitled to a letter of engagement.[13] In these situations where a third party is paying the client's fees, the client's consent to the payment is required after full disclosure.[14] The careful lawyer will also provide the written letter of engagement to the actual client, in addition to the person or entity paying the fees, to establish consent and avoid confusion as to the obligations of all concerned.

Contents

The letter of engagement must address several matters. It must contain an explanation of the scope of the services to be provided.[15] A lawyer may limit the scope of her representation of the client, provided the lawyer is able to competently represent the client and the client fully understands the consequences of the limitation.[16] In the wake of the Court of Appeals' recent decision in Darby & Darby, P.C. v. VSI International Co.,[17] many attorneys are addressing whether the scope of their services includes investigation of the existence of insurance coverage for the lawyer's fee. Similarly, personal injury lawyers frequently limit the scope of their representation through the trial phase of the litigation.[18] Essentially, this portion of the rule requires the lawyer to conform to a sound law office practice and will assist the lawyer in the future if any question arises concerning the scope of her duties.

The letter must also contain an "explanation of attorney's fees to be charged, expenses and billing practices."[19] This provision, which is obviously of central importance to the rule, is not generous with detail. Lawyers struggling with the degree of specificity necessary should turn to DR 2-106(D), which lists the requirements for all lawyers representing clients in contingent fee matters.[20]
DR 2-106(D) requires that the lawyer provide the client with a writing stating the method by which the fee is to be determined, including the percentage or percentages that shall accrue to the lawyer in the event of settlement, trial or appeal, litigation and other expenses to be deducted from the recovery and whether such expenses are to be deducted before or, if not prohibited by statute or court rule, after the contingent fee is calculated.

In contingent fee matters, lawyers will want to satisfy the requirements of DR 2-106(D) and §1215.1(b)(2) in the same document. Adding an explanation of the lawyer's billing practices to the items in DR 2-106(D) should accomplish the task. Lawyers retained on an hourly basis should state the hourly rate of each person whose time may be charged to the client and any out-of-pocket disbursements for which the client will be required to reimburse the attorney. The letter of engagement should also state the frequency of billing, payment terms and applicable interest.[21]

The letter of engagement must also state, "[w]here applicable," notice of the client's right to arbitration of fee disputes under the new Part 137, effective Jan. 1, 2002. Part 137 is applicable in a wide range of cases, but will not apply in criminal matters and a limited number of civil cases.[22] If there is any doubt as to the applicability of Part 137, lawyers should include the notice of the right to arbitrate in the letter of engagement because a lapse on this front may jeopardize the right to collect the fee.[23]

Exceptions

In lieu of a letter of engagement, an attorney may comply with the provisions of the rule "by entering into a signed written retainer agreement with the client," provided the agreement includes the contents required in the letter.[24] Presumably, the major difference between a letter of engagement and a retainer agreement is that the latter is signed by the client. Lawyers should opt for the signed written retainer agreement whenever possible. This will help to avoid disputes regarding compliance with the rule and will be far more persuasive in a subsequent fee dispute or malpractice suit.

The rule will not apply to representation of a client where the fee to be charged is expected to be less than $3,000. Will a lawyer who fails to provide the letter in reliance on this exception be precluded from recovering an amount in excess of $3,000? It's a risk not worth taking.

As already noted, the rule does not apply to a representation "where the attorney's services are of the same general kind as previously rendered to and paid for by the client."[25] This exception looms large, but is one lawyers should avoid. If the prior services were not the subject of a written retainer, it may be difficult to prove that services performed after March 4, 2002 were of the same general kind as those performed prior to that date. In any event, lawyers performing substantial services for clients without an express agreement diminish their position in a subsequent dispute with the client.

Finally, the rule does not apply to representation in "domestic relations matters,"[26] which is broadly defined.[27] In a domestic relations matter, the lawyer must use a written retainer agreement conforming to the detailed provisions in Part 1400.28

"Nonengagement"

Although not required by Part 1215, a lawyer who declines representation in a particular matter should forward a letter of nonengagement to the nonclient. This practice avoids confusion and prevents the nonclient from subsequently arguing that the lawyer owes her a duty. This point and many other aspects of Part 1215 that raise trouble are addressed in the March 2002 edition of Siegel's Practice Review, Number 120.

Patrick M. Connors is an assistant professor of law at Albany Law School.

FootNotes:
[1] 22 NYCRR § 1215.2(2). This exception is discussed in section "F" of the article.
[2] 22 NYCRR § 1215.1(a).
[3] DR 1-105, which governs choice of law issues in disciplinary proceedings, does not appear to provide a definitive answer. See New York Code of Professional Responsibility DR 1-105(B)(2)(b).
[4] 22 NYCRR § 137.1(a).
[5] 22 NYCRR § 137.1(b)(7).
[6] 22 NYCRR § 1215.1(a).
[7] Id.
[8] Id.
[9] See N.Y. State Bar Ops. 604 (1989) and 713 (1999) (client may limit scope of lawyer's representation as long as lawyer is able to otherwise competently represent client and client fully understands consequences of limitations).
[10] This type of signature is required by the client in a domestic relations matter to establish receipt of the Statement of Client's Rights and Responsibilities. See 22 NYCRR § 1400.2.
[11] See N.Y. Code of Professional Responsibility DR 5-107(B); see also Nelson Electrical Contracting Corp. v. Transcontinental Insurance Co., 231 AD2d 207 (3d Dep't 1997).
[12] 22 NYCRR § 1215.1(a).
[13] Similarly, if a parent or friend pays the legal bills of the client, they are entitled to a letter.
[14] DR 5-107(A)(1).
[15] 22 NYCRR § 1215.1 (b)(1).
[16] See supra note 9 and accompanying text.
[17] 95 NY2d 308 (2000)
[18] See Vitale v. LaCour, 92 AD2d 892 (2d Dept. 1983) appeal denied 60 NY2d 556.
[19] 22 NYCRR §1215.1 (b)(2)
[20] The Appellate Division Rules also require the filing of "Retainer Statements" in most contingent fee matters, which must include the "Terms of compensation." The Rules also contain schedules of "reasonable fees" which must be adhered to in most contingent fee matters. See 22 NYCRR § 603.7 (1st Dept.); 22 NYCRR §691.20 (2d Dept.' 22 NYCRR 806.12 (3d Dept.); 22 NYCRR §§ 1022.2, 1022.31 (4th Dept.). The Third Department rules do not require the filing of retainer agreements.
[21] See N.Y. State 399 (1975) (not per se improper for lawyer to charge client interest on delinquent accounts provided certain requirements are met.)
[22] See 22 NYCRR 137.1(b) (listing disputes to which Part 137 does not apply).
[23] See Siegel's Practice Review, Nos. 117-119 for an extensive discussion of Part 137's requirements and potential penalties for failure to comply with its terms.
[24] 22 NYCRR § 1215(c)
[25] 22 NYCRR §1215.2(2)
[26] NYCRR §1215.2(3)
[27] See 22 NYCRR §§ 1200.1(j), 1400.1

ACLU Files Suit To Challenge Closed Removal Hearings

The American Civil Liberties Union (ACLU) has filed a federal lawsuit to force the Justice Department to remove a categorical block to open removal proceedings. The case in question involves Rabih Haddad, a Muslim cleric in Detroit, whose removal hearing was ordered closed in accordance with a memorandum signed by the Chief Immigration Judge. Among those excluded from the hearing were the press and Representative John Conyers (D-MI), the Ranking Member of the House Judiciary Committee, which has oversight over the Department of Justice. The plaintiffs include Detriot News, Ins, Congressman John Conyers, while the named defendants include Attorney-General John Ashcroft, and Hon. Michael Creppy, Chief Immigration Judge of the United States. The suit is pending at the United States District Court Eastern District of Michigan, Southern Division.