In this article, we’ll be drafting a legal client letter example and walking through all the details so you can feel comfortable drawing up new arrangements.
A well-drafted legal client engagement letter is one of the most important documents to have in your arsenal. It serves as the foundation of the attorney-client relationship and, if done properly, establishes clear expectations from the outset.
If you’re looking for a legal client letter example, it’s essential to focus on clear communication and compliance with statutory requirements.
While some may view engagement letters as routine paperwork, they actually offer a unique opportunity to solidify key details regarding the attorney-client relationship.
Additionally, a well-drafted engagement helps build trust by placing both parties on the same page from the outset of the relationship.
In this guide, we’ll walk through the essential elements of a legal client engagement letter, with a focus on best practices for attorneys in California.
We’ll also provide a legal client letter example to help you get started. Of course, we’re not attorneys so before you adopt this sample, you’re going to want to do your own analysis (or, if you’re not an attorney, run it past one).
What is a client engagement letter?
Although it’s termed a “letter,” a client engagement letter is actually a written agreement between an attorney and their client that outlines the terms of their professional relationship.
It serves as both a formal contract and a communication tool. Ultimately, it helps ensure that both parties understand the full parameters of the representation.
In California, client engagement letters are principally governed by Business and Professions Code sections 6147 and 6148.
Section 6147 requires that any contingency fee arrangement between a client and attorney must be documented in a written agreement signed by both parties. This agreement should specify the contingency fee rate, explain how costs and disbursements related to the case will impact the fee and the client’s recovery, and include a statement clarifying that the fee is negotiable rather than set by law.
Section 6148, meanwhile, instructs that a written engagement agreement is also required for most matters not covered by Section 6147 – so long as the parties reasonably expect that the client’s total expenses, including attorney fees, will exceed $1,000.
Agreements falling under this section have to outline the attorney’s compensation structure, provide a general description of the legal services to be rendered, and clarify the respective responsibilities of both the attorney and the client under the contract.
Section 6148 also specifies the billing requirements for such agreements. It’s also important to note that this provision contains certain exceptions to the written fee agreement requirement, such as when the client is a corporation.
The legislature wasn’t kidding around when they wrote these provisions. Indeed, if you fail to comply with them, your client has the option to void the client engagement letter. (Note, however, that even if the agreement is voided, you can still seek to collect a reasonable fee).
So, now that we understand the statutory requirements, let’s dive into the nuts and bolts of your engagement letters.
Key elements of an effective engagement letter
A strong example of a legal client letter does more than satisfy legal requirements – it builds the foundation for a clear, professional relationship between the attorney and client. Here are the essential elements every engagement letter should include:
1. Identification of parties
The engagement letter should clearly state who you will represent and – equally important – who you will not represent. This is critical in situations where multiple parties are involved, such as representing a business or in complex litigation matters.
It may sound basic, but defining who the client is from the get-go helps avoid future confusion. For example, if you’re representing a company, you’ll want to clarify that your client is the entity itself, not its individual officers or employees.
2. Scope of services
The scope of services section defines the legal work that will be performed. Once again, however, it can be just as important to try to identify services that are not included. This part of the engagement letter helps both attorney and client avoid “scope creep,” where a client starts to expect services outside the original agreement without additional compensation.
To illustrate, imagine that you’re representing a client in a real estate transaction. You’ll want the engagement letter to clarify that you are not also providing tax or financial advice (unless you are). This can help prevent misunderstandings and gives you something tangible to fall back on if the client later questions why you’re not doing something outside the agreed-upon scope of services.
3. Fee structure
Obviously, the fee structure is one of the most important parts of an engagement letter because it defines how, when, and what the client will pay you. At a minimum, this section should include:
- Whether the attorney is charging an hourly rate, a flat fee, or working on a contingency basis.
- The hourly rate for each attorney or paralegal involved in the case, if applicable.
- Retainer amounts and how the retainer will be billed against.
- Billing cycle (e.g., monthly, quarterly) and when payment is due.
If you’re charging a contingency fee, be sure to explain how the fee will be calculated and clarify whether the client will be responsible for costs (see below). It’s also a good idea to include an estimate of total costs or an explanation of how costs will be handled.
4. Costs and expenses
Even though we touched on this in the prior section, it’s an important enough topic to warrant its own discussion. Costs can include a lot of things the client may not anticipate – court filing fees, deposition expenses, or fees for expert witnesses often arise during legal representation (for a comprehensive list of potential fees and costs, take a look at Code of Civil Procedure section 1033.5). Your clients deserve to know upfront whether they will be responsible for these expenses.
Also, be sure to include a clear explanation of how costs will be paid. For example, an attorney may front the costs and bill the client later. Conversely, the client may be expected to pay these costs directly. Using transparent language here can help avoid disputes about expenses later in the representation.
5. Conflicts of interest
California, like all states, requires attorneys to avoid conflicts of interest. Indeed, California Rule of Professional Conduct 1.7 instructs that if there is any potential for a conflict of interest, this must be disclosed to the client, and informed written consent should be obtained. Conflicts of interest may arise when the attorney represents multiple clients in related matters, or where the attorney has a personal or financial interest in the outcome of the case.
6. Client responsibilities
In any legal matter, the attorney will obviously handle the substantive work, but we all know that work doesn’t happen in a vacuum. Consequently, it’s important to outline what the client’s responsibilities will be during the course of representation.
Common client responsibilities might include:
- Providing necessary information and documents in a timely manner.
- Participating in the creation of legal strategies.
- Attending court appearances or depositions as required.
- Paying invoices promptly.
By specifying these responsibilities, attorneys can hold clients accountable for their part in the process and let the client know that they have a real stake in the outcome of their matter.
7. Termination of services
An engagement letter should also explain the circumstances under which the attorney-client relationship can be terminated, either by the client or by the attorney. Common reasons for termination include non-payment of fees, a breakdown in communication, or the conclusion of the legal matter.
California Rule of Professional Conduct 1.16 sets forth the precise circumstances and procedures for terminating the relationship and it’s not a bad idea to provide the client with a copy of that Rule as part of the engagement letter.
Additionally, this section should specify what will happen to the client’s files upon termination and how any outstanding fees will be handled. Having this information in writing can help prevent postering and aggravation if the relationship ends on a sour note.
So, with all of that in mind, let’s take a look at what a sample client engagement letter might look like.
Legal client letter example
To illustrate these principles, here’s a sample legal client letter example:
[Law Firm Name]
Client Engagement Letter
Date: [Insert Date]
Client Name: [Insert Client Name]
Re: Legal Representation for [Insert Matter Description]
Dear [Client Name],
Thank you for selecting [Law Firm Name] to represent you in connection with [describe the matter, e.g., “your real estate transaction” or “your litigation against X”]. We look forward to working with you. This engagement letter outlines the terms of our representation, including the scope of services, fee structure, and other important details. Please review this letter carefully, and do not hesitate to ask any questions.
- Identification of Parties
We will be representing you, [Client Name], in connection with [specific matter]. Our representation does not extend to any related individuals or entities unless expressly agreed upon in writing. For example, our representation does not include [other parties, e.g., “your spouse” or “your business partner”], unless otherwise specified.
- Scope of Services
We will provide legal services related to [specific legal matter]. This may include [list services: drafting documents, providing legal advice, negotiating with third parties, appearing in court]. Please note, we are not providing advice on matters outside this scope, including [tax, financial, or other areas unrelated to the legal matter]. Should the need arise for additional services outside this scope, we will discuss this with you and provide a revised agreement for your review and approval.
- Fee Structure
Our fees for this matter will be [hourly, flat, or contingent].
Hourly Fees: The hourly rate for legal services provided by [Attorney Name] is $[insert hourly rate], and the hourly rate for paralegal services is $[insert paralegal rate]. These rates may change periodically, but we will notify you in advance.
Retainer: You are required to pay an initial retainer of $[insert amount], which will be applied to your future invoices. If the retainer balance falls below $[amount], we may request an additional deposit.
Invoicing and Payment: We will send you monthly invoices detailing the services provided and any costs incurred. Payment is due within [insert number] days of the invoice date. Unpaid balances may accrue interest at a rate of [insert percentage].
- Costs and Expenses
In addition to legal fees, you will be responsible for reimbursing any costs associated with your case. These costs may include, but are not limited to, court filing fees, deposition costs, expert witness fees, and travel expenses. We will make every effort to inform you in advance of significant expenses.
- Conflicts of Interest
We have performed a conflict check and determined that we do not have any conflicts of interest that would prevent us from representing you. If any potential conflicts arise during the course of our representation, we will promptly inform you and seek your written consent to proceed.
- Client Responsibilities
To effectively represent you, we require your full cooperation. You agree to:
- Provide all necessary information and documentation promptly.
- Communicate with us openly and honestly.
- Attend any required meetings, court appearances, or depositions.
- Make timely payments for our services as outlined above.
- Failure to meet these responsibilities may result in delays or termination of our representation.
- Termination of Services
You may terminate our services at any time by providing written notice. We may also withdraw from representation under certain circumstances, such as non-payment of fees, a breakdown in communication, or any of the other reasons listed in California Rule of Professional Conduct 1.16. In the event of termination, we will provide reasonable notice and ensure that you have the opportunity to secure alternative representation.
Upon termination, any unpaid fees or costs will be due immediately. We will return all original documents to you, and you may request copies of your case file for your records.
- Conclusion
We are committed to providing you with high-quality legal services and clear communication throughout the course of our representation. Please sign and return a copy of this engagement letter to indicate your agreement with these terms.
If you have any questions or concerns, feel free to reach out to me at [attorney’s phone number] or [email address]. We look forward to working with you.
Sincerely,
[Attorney Name]
[Law Firm Name]
[Attorney’s Contact Information]
Acknowledgment of Agreement
I, [Client Name], have read, understand, and agree to the terms outlined in this engagement letter.
Signature: ___________________________
Date: ___________________________
Conclusion
A well-drafted engagement letter is essential for establishing a professional attorney-client relationship.
By ensuring clarity, transparency, and compliance with legal requirements, such a letter fosters trust and sets the stage for effective collaboration.
I hope this legal client letter example can guide you in creating customized documents that meet these goals.
Whether you’re drafting from scratch or refining an existing template, attention to detail and clear communication are key to a successful engagement process.
