Client Care 101: Advising on What You Don't Advise On

The second part of Client Care 101 illustrates the importance of what you say in your retainer letter or in your ROT (or preferably both).

Solicitor Justin from firm ABC receives a call from Mr. Green who asks for a quote on a purchase. During the conversation Mr. Green talks about how it is his dream home but requires a lot of building work as they are intending to carry out a large double storey side extension.

Mr. Green mentioned that his advisers were in discussions with the council and had already had plans drawn up. Justin assumed therefore assumed that Mr. Green had an architect or planning expert on the case. Justin was proud of himself in winning the instruction  and sent Mr. Green the standard client care letter.

The purchase went through smoothly. But, imagine Justin’s surprise when six months later Mr. Green came back to him complaining that planning permission has been refused arguing that he would never have bought the house had he known that planning permission would not be granted.

Imagine if the retainer letter and Report on Title (ROT) had included something like, “I understand that you have planning experts and an architect to advise on the likelihood of obtaining planning permission for your proposed extension , and therefore this retainer does not include advice on planning matters.” or possibly a more generic catch all paragraph saying that the firms does not cover such advice.  Even in the unlikely event the client had still tried to bring a claim, Justin would surely have a strong reference that checking the planning aspect was not within the remit of his advice.

I am making mention here of the ROT as the scope of the retainer may change over the course of the deal and the ROT affords you that last opportunity to redefine the retainer. This is why some firms take the opportunity to resend the equivalent of ROT even on a sale file.  One needs to have a mindset of the retainer as a living document rather than an administrative job completed as soon as the physical file is created.

As if negligence claim is not bad enough the new regulatory regime of outcome-focused regulation where managing client’s expectations is so important means that, now more than ever, client take-on procedure and sophisticated retainer letters should be central to your risk management.

Never, never fall in the trap of thinking that your retainer letter is a static precedent.