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July 2011

Charles Berwanger Authors Article on Engagement Agreements for San Diego Lawyer

In an article in the July/August issue of San Diego Lawyer, San Diego Partner Charles Berwanger explained the importance of having a detailed, multi-page engagement agreement with clients.  The article, titled "Disengaged," utilizes a hypothetical scenario in which a defendant filed a motion to disqualify opposing party's counsel based on that counsel's prior representation of the defendant.  Unfortunately for counsel, he incorrectly believed the attorney-client relationship with the adverse party had ended years prior.

Mr. Berwanger uses humor to make his point by presenting the story of an attorney, Dick Consulate, handling a matter for his most important client "Big Bucks" against the defendant, "Small Fry," a business he had successfully represented in a single matter years before.  Small Fry filed a motion to disqualify Consulate, claiming he had a conflict of interest.  Consulate believes his representation of Small Fry - for which he was never paid - ended at the conclusion of the prior matter.  Big Bucks has told Consulate he is responsible for defending the motion at his own expense and if he loses the motion, Big Bucks will terminate its relationship with Consulate, require Consulate to reimburse Big Bucks for all fees paid to date, and Big Bucks will not pay a large outstanding invoice. 

As Mr. Berwanger notes, Consulate preferred to use a "one-page simple" engagement agreement, instead of a detailed, multi-page agreement that was recommended in a bar association ethics seminar Consulate had attended. Unfortunately, the single page agreement only stated that Consulate would represent Small Fry for a nominal retainer and did not limit the representation to a particular matter.  The article reviews the differences between a "framework agreement" and a "classic retainer agreement," as well as the issues raised in Banning Ranch Conservancy v. Superior Court which holds that the attorney-client relationship continues to exist under a classic retainer agreement until the representation is formally ended.

Though written in a tongue-in-cheek fashion, his article nonetheless underscores the serious consequences that can emerge from the lack of a well-defined agreement.  Please click here to read the complete article.

Charles V. Berwanger