Preventing claims – Limited retainers/unbundling

The following is a summary of Managing the risk of a limited retainer, Insurance Issues: Risk Management, Summer 2010.

For clients anxious to minimize the cost of legal services, the limited retainer’s time has come. Colloquially known as “unbundling,” the limited retainer involves splitting the usual package of work involved in a matter into discrete tasks. The client retains the lawyer to perform only some of these tasks, and maintains responsibility for the remainder.

Unbundling arises in a variety of contexts, including litigants interested in self-representation but requiring some technical assistance and business clients keen to attend to numerous aspects of a transaction themselves.

The risks include:

  • Failing to adequately warn your client of the consequences of a limited retainer
  • Accepting limits that are unreasonable - some matters are simply not appropriate for a limited retainer
  • No shared understanding between you and your client as to who is responsible for what
  • Not adequately qualifying your advice if it is based only on information that the client chooses to provide

To help manage the risk, follow these tips (read more for details):

  • Be clear about the limits, related risks or consequences and any qualifications to your advice.
  • Confirm everything in a written retainer agreement using clear, plain language.
  • Use the initial client meeting to carefully assess the appropriateness of the limited retainer.
  • Avoid making assumptions.
  • Share any limits with others in your office.
  • Be proactive with clients if the limited retainer is putting you at risk.
  • Use checklists to help identify and record who is responsible for what.
  • If you are providing anonymous drafting assistance:
    • Alert your client to the rules that govern Court costs;
    • Warn your client that your role may become public as a result of your ethical obligations.
  • Remember that the risk management practices you employ in a traditional retainer apply equally to a limited one.
  • If appropriate, use the stamp "no legal advice sought or given", and use it effectively.
  • Appreciate that you have ethical obligations in relation to limited scope retainers, as well (read more for details).

Webinar

CLE-TV: Limited Scope Retainers on YouTube – This 2014 course explores the unique opportunities that limited scope retainers present to expand your client base and improve the public's access to legal services, as well as the risks created by the limited nature of the retainer. The presenters discuss practice and ethical issues, risk management and current research and thinking, giving you the tools that you need to make limited scope retainers a valued part of your practice.