Insight

The Dangers of Broad Scope Retainer Agreements

A group of lawyers in Florida were sued by their client for a mistake made by the client’s previous legal representation. The case raised many questions about attorney responsibility when inheriting clients from other lawyers.

Man with bullseye face
SC

Sara Collin

July 12, 2022 03:00 PM

Last week, the Florida Court of Appeals released a legal malpractice decision that made headlines after a client successfully sued her attorneys for missing a deadline. What made the case more interesting, however, is that the attorneys she sued had not been the ones to miss the deadline.

In Baum v. Becker & Poliakoff, P.A., the client had retained lawyers to represent her in a probate litigation case involving a $100 million estate. Her attorneys missed a vital service deadline. Soon after, the client retained different attorneys to represent her. However, because of the missed deadline, the client’s case was dismissed.

The client subsequently filed suit against the second set of attorneys for malpractice. On summary judgment, the trial judge ruled in favor of the attorneys. However, on appeal, the Court reversed the decision, ruling that the second attorneys had proximately caused damage by failing to cure the first attorneys’ mistake, noting that they had been “retained, at least in part, to take reasonable steps to avoid the adverse consequences of [the client]'s predecessor counsel's failure to effect service of process."

“It appears Florida's Court of Appeal is comfortable blaming a lawyer for a deadline missed before the lawyer was even retained,” commented Jeffrey Cunningham, a partner at Goldberg Segalla in White Plains, NY, who defends lawyers and acts as outside General Counsel to law firms. “The scope of this decision could have a very broad, chilling effect on attorneys taking on cases from prior counsel if they can be sued for prior counsel's mistakes.”

In Cunningham’s opinion, the case also speaks to a broader issue, stating, “Potentially, risk could be avoided or mitigated through a provision in the retainer agreement disclaiming responsibility for prior counsel's work or at least explaining the risks associated with transferring a case during the course of a litigation. Such a provision could have also alerted the attorneys to the potential and made them reevaluate the case or notice prior counsel's mistake sooner.”

Additionally, as Baum forewarns, Cunningham stated that counsel should be extra vigilant when taking on a client who had previous representation: “Even in the best of circumstances, inheriting a case from another attorney includes a lot of risk—getting up to speed quickly, understanding prior counsel's strategy and navigating whatever obstacles prompted the client to switch counsel all invite problems. Since you usually don't know what prior counsel did until you get into the file, I always recommend limiting the representation as much as you can at the outset—you can always adjust the scope later as needed. While you can't contract away your duties of competent representation in a retainer agreement, you can limit the risk of inherited incompetence."

Thus, according to Cunningham, retainers should be updated periodically to truly capture the scope of the representation to protect both the lawyer and the client. “Most attorneys do not effectively utilize this risk management tool,” he explained.

Cunningham believes that lawyers should be systematically reviewing and updating their retainer agreements—he recommends doing so when you change your smoke detector batteries—as well as custom-tailoring them to each client for each matter and limiting their scope. “Without a solid retainer agreement defining the identity of the client, the scope of services, the fee arraignment, etc. lawyers expose themselves to incredible risk by essentially the only person that can sue them for malpractice, the client.”

Finally, according to Cunningham, attorneys should consider asking for expert advice on the matter. “Retain your own outside counsel to review your retainer agreements. This is not a DIY job and outside counsel brings your firm clear attorney-client privilege protection.”

Headline Image: iStock/ Pict Rider

Related Articles

The U.S. Best Lawyers Voting Season Is Open


by Best Lawyers

The voting season for the 31st edition of The Best Lawyers in America® and the 5th edition of Best Lawyers: Ones to Watch® in America is officially underway, and we are offering some helpful advice to this year’s voters.

Golden figures of people standing on blue surface connected by white lines

IN PARTNERSHIP

Does Your Law Firm Need a COO?


by Esquire Bank

Esquire Bank explains how having a chief operating officer can help with law firm growth plans, business management, client acquisition and daily operations.

Does Your Law Firm Need a COO?

IN PARTNERSHIP

Contingency Fee Law Firm Valuation: What Factors Matter for Financing?


by Esquire Bank

Esquire Bank offers information on the valuation of a contingency law firm and the financing options they offer to support law firm growth strategies.

What Factors Matter for Law Firm Financing

IN PARTNERSHIP

The No-Stress Way to Efficiently Fund a Law Firm


by Esquire Bank

Esquire Bank explains how many lawyers who are starting their own firms can identify a strategic banking partner to offset the difficulties of self-funding.

The No-Stress Way to Efficiently Fund a Law Firm

IN PARTNERSHIP

How to Easily Acquire Smart Financing for Sustainable Law Firm Growth


by Esquire Bank

Esquire Bank explains what private equity is and why many private equity firms are finding it more advantageous over more traditional forms of financing.

Esquire Banks Guide to Financing for Sustainable Firm Growth

The Best Lawyers in Mexico Celebrates a Milestone Year


by Best Lawyers

Best Lawyers is excited to announce the 15th edition of The Best Lawyers in Mexico™ and the second edition of Best Lawyers: Ones to Watch in Mexico™ for 2024.

Sky view of Mexico city scape

Best Lawyers Expands 2024 Brazilian Awards


by Best Lawyers

Best Lawyers is honored to announce the 14th edition of The Best Lawyers in Brazil™ and the first edition of Best Lawyers: Ones to Watch in Brazil™.

Image of Brazil city and water from sky

IN PARTNERSHIP

How Private Equity Investment is Disrupting the Legal Industry


by Esquire Bank

Private Equity loans are changing how law firms operate, but these funding options should not affect the profession's ethical standards or the best interests of the clients.

Four Hands Taking Pieces Out of a White Pie Graph

The 2024 Best Lawyers in Spain™


by Best Lawyers

Best Lawyers is honored to announce the 16th edition of The Best Lawyers in Spain™ and the third edition of Best Lawyers: Ones to Watch in Spain™ for 2024.

Tall buildings and rushing traffic against clouds and sun in sky

Announcing The Best Lawyers in South Africa™ 2024


by Best Lawyers

Best Lawyers is excited to announce the landmark 15th edition of The Best Lawyers in South Africa™ for 2024, including the exclusive "Law Firm of the Year" awards.

Sky view of South Africa town and waterways

The Best Lawyers in Portugal™ 2024


by Best Lawyers

The 2024 awards for Portugal include the 14th edition of The Best Lawyers in Portugal™ and 2nd edition of Best Lawyers: Ones to Watch in Portugal™.

City and beach with green water and blue sky

3 Key Considerations for Navigating Complex Insurance Litigation in Florida


by Best Lawyers

Insurance litigation in Florida can be very complex. Issues related to insurance regulations have created an especially litigious environment. Learn more here.

Living room in a house flooded with water

IN PARTNERSHIP

Circuit Split: Can Federal Courts Award Lost Profits as Part of a Restitution Order?


by Nicholas Oleski

The Sixth Circuit has ruled against awarding lost profits as restitution to a business forced to close due to a robbery, highlighting a growing circuit split on whether lost profits can be included in restitution orders under the Mandatory Victims Restitution Act (MVRA).

Red shop doors with glass broken open

IN PARTNERSHIP

Where’s My Apology Letter? Client Control and Expectations Regarding Representation


by Joseph S. Passanise and Taylon Sumners

Through every interaction with clients, lawyers can practice effective client management, utilizing clear communication, transparency and diligence.

Professional men and women sitting around a table shaking hands and making business deals

Violating the Victim


by Megan Bishop and Thomas R. Ward

Two criminal law lawyers from Colorado detail the confounding ways in which prosecutors violate the victim in domestic violence cases.

Cartoon of woman in blue shirt and hair covering her face

The Courtroom Climate


by Peter Kolla

Recent decisions across Canada have underscored that courts are wary of usurping legislatures—both provincial and federal—when faced with litigants demanding they do something about climate change.

Factory image with courtroom imagery overlaid

Trending Articles

How Palworld Is Testing the Limits of Nintendo’s Legal Power


by Gregory Sirico

Many are calling the new game Palworld “Pokémon GO with guns,” noting the games striking similarities. Experts speculate how Nintendo could take legal action.

Animated figures with guns stand on top of creatures

Announcing the 2023 The Best Lawyers in America Honorees


by Best Lawyers

Only the top 5.3% of all practicing lawyers in the U.S. were selected by their peers for inclusion in the 29th edition of The Best Lawyers in America®.

Gold strings and dots connecting to form US map

The U.S. Best Lawyers Voting Season Is Open


by Best Lawyers

The voting season for the 31st edition of The Best Lawyers in America® and the 5th edition of Best Lawyers: Ones to Watch® in America is officially underway, and we are offering some helpful advice to this year’s voters.

Golden figures of people standing on blue surface connected by white lines

How To Find A Pro Bono Lawyer


by Best Lawyers

Best Lawyers dives into the vital role pro bono lawyers play in ensuring access to justice for all and the transformative impact they have on communities.

Hands joined around a table with phone, paper, pen and glasses

Announcing the 2022 Best Lawyers® in the United States


by Best Lawyers

The results include an elite field of top lawyers listed in the 28th Edition of The Best Lawyers in America® and in the 2nd Edition of Best Lawyers: Ones to Watch in America for 2022.

2022 Best Lawyers Listings for United States

What the Courts Say About Recording in the Classroom


by Christina Henagen Peer and Peter Zawadski

Students and parents are increasingly asking to use audio devices to record what's being said in the classroom. But is it legal? A recent ruling offer gives the answer to a question confusing parents and administrators alike.

Is It Legal for Students to Record Teachers?

2021 Best Lawyers: The Global Issue


by Best Lawyers

The 2021 Global Issue features top legal talent from the most recent editions of Best Lawyers and Best Lawyers: Ones to Watch worldwide.

2021 Best Lawyers: The Global Issue

Best Lawyers: Ones to Watch in America for 2023


by Best Lawyers

The third edition of Best Lawyers: Ones to Watch in America™ highlights the legal talent of lawyers who have been in practice less than 10 years.

Three arrows made of lines and dots on blue background

The Upcycle Conundrum


by Karen Kreider Gaunt

Laudable or litigious? What you need to know about potential copyright and trademark infringement when repurposing products.

Repurposed Products and Copyright Infringemen

The Best Lawyers in Australia™ 2024 Launch


by Best Lawyers

Best Lawyers is excited to announce The Best Lawyers in Australia™ for 2023, including the top lawyers and law firms from Australia.

Australian Parliament beside water at sunset

Best Lawyers Voting Is Now Open


by Best Lawyers

Voting has begun in several countries across the globe, including the United States, the United Kingdom and Europe. Below we offer dates, details and answers to voting-related questions to assist with the voting process.

Hands holding smartphone with five stars above phone

Inflation Escalation


by Ashley S. Wagner

Inflation and rising costs are at the forefront of everyone’s mind as we enter 2023. The current volatile market makes it more important than ever to understand the rent escalation clauses in current and future commercial lease agreements.

Suited figure in front of rising market and inflated balloon

Wage and Overtime Laws for Truck Drivers


by Greg Mansell

For truck drivers nationwide, underpayment and overtime violations are just the beginning of a long list of problems. Below we explore the wages you are entitled to but may not be receiving.

Truck Driver Wage and Overtime Laws in the US

A Celebration of Excellence: The Best Lawyers in Canada 2024 Awards


by Best Lawyers

As we embark on the 18th edition of The Best Lawyers in Canada™, we are excited to highlight excellence and top legal talent across the country.

Abstract image of red and white Canada flag in triangles

Announcing The Best Lawyers in South Africa™ 2024


by Best Lawyers

Best Lawyers is excited to announce the landmark 15th edition of The Best Lawyers in South Africa™ for 2024, including the exclusive "Law Firm of the Year" awards.

Sky view of South Africa town and waterways

Presenting the 2024 Best Lawyers Family Law Legal Guide


by Best Lawyers

The 2024 Best Lawyers Family Law Legal Guide is now live and includes recognitions for all Best Lawyers family law awards. Read below and explore the legal guide.

Man entering home and hugging two children in doorway