What did they expect?

17 August, 2018

When sued by a client, the reaction from some practitioners is ‘What did they expect for what I charged?’

However, a court will give little regard to your fees when determining the extent of your retainer and whether you discharged your duty. You need to be clear about the scope of your retainer, irrespective of the type and size, and discharge your duty in every matter.

In one claim, the practitioner acted for the nominee in the purchase of an off-the-plan apartment. The practitioner’s costs disclosure form stated that she would prepare the transfer of land and nomination documents as well as arrange and attend settlement. She did not provide any pre-contractual or pre-nomination advice. She said she normally gives purchaser clients the option to have the contract of sale reviewed for an additional charge but did not do so in this instance as the client was eager to proceed with the transaction.

The client alleged the selling agent represented the apartment had an allotted car park. However, the contract did not refer to the carpark and the vendor did not intend to sell a car park with the apartment. Consequently, the client did not become aware of the car park issue until shortly before settlement. She then claimed the practitioner was under a duty to advise of the issue before the nomination was executed.

The practitioner said she did not ask the client what she thought she was buying and only became aware of her expectations and the agent’s representations just before settlement. She did not provide advice on the contract of sale because she did not consider she was retained to do so. However, the limited scope of work was not discussed and clarified with the client.

When acting for a purchaser in a conveyance, practitioners would ordinarily be expected to summarise key issues and unusual aspects of the contract and property, and confirm they are consistent with the client’s understanding. Purporting to limit a retainer to provide less than this is fraught with danger. It requires a clear written scope and advice about the risks of limiting the retainer, so the client can make an informed decision whether to limit the practitioner’s duty.

It is far better to add value for your clients by proactively asking questions and advising clients on all aspects of their purchase and charging appropriately for the service. Be the trusted professional legal advisor. It takes some work to show the value you can add but pays off in the long run.