Illinois Association of Defense Trial Counsel
P.O. Box 7288, Springfield, IL 62791
IDC Quarterly Vol. 12, No. 1 (12.1.19)
Legal Ethics
By: Karen J. Dilibert, ISBA Mutual, Chicago
Reporters trained at the now-defunct Chicago City News Bureau were frequently admonished to
check all of their facts: “If your mother says she loves you, check it out.” Modified a bit for lawyers,
this motto would be: “If your mother says she loves you, get it in writing.”
Documenting important client decisions is not just CYA. It is the foundation of good client
relations. You need to be sure that you understand your client’s instructions. Your client, in turn,
needs to understand the potential ramifications of the decision. Seeing it in writing makes it real for
many clients in a way that an hour-long discussion does not.
And, yes, documentation is good malpractice prevention as well. A recent study indicated that
almost 12% of all claims against lawyers arose from the lawyers’ failure to obtain client consent or
keep clients informed, with another 4% stemming from lawyers’ failure to follow clients’
instructions.1 Being able to prove that your client gave informed consent to a particular strategy or
course of action is critical to your ability to defend against malpractice claims.
This article discusses why, how, and when to document client decisions. As a recent case
illustrates, clients sometimes regret their decisions – even if they turn out well. I’ll identify some
situations that should send you flying to the nearest writing implement. As I’ll show, confirming
important client decisions in writing is often in the interest of both lawyer and client. It’s really not
just CYA – unless you mean covering your assets.
A Case of Settler’s Remorse
The Seventh Circuit’s recent decision of McKnight v. Dean2 shows that clients can experience
“settler’s remorse” even when the settlement turns out well for the client.
The circumstances of this legal malpractice case are rather unusual in that the plaintiff McKnight
alleged that his lawyer, Dean, committed malpractice in the course of settling McKnight’s malpractice
case against another attorney, Gingras.3 Gingras’ malpractice carrier offered to settle the case for the
remaining limits on Gingras’ insurance policy, which amounted to $765,000.4
McKnight accepted the offer. Later, though, he filed a lawsuit alleging, in part, that Dean advised
him that $765,000 was the most he could expect to obtain, and concealed from McKnight the fact that
any excess judgment could be satisfied out of Gingras’ personal assets. McKnight alleged that Dean
committed malpractice in “forcing” him to settle for $765,000, rather than holding out for a larger
settlement and, if necessary, proceeding to trial. Dean denied that he coerced McKnight into settling
the case.5 The District Court granted summary judgment for Dean.
The Seventh Circuit affirmed. Judge Posner cautioned that if McKnight’s allegations were taken as
true, Dean would be guilty of “a form of malpractice (more precisely, a breach of the lawyer’s ethical
duty to the client).” The court explained, “If McKnight was pigheaded and wanted to tilt at windmills,
that was his right. Dean didn’t have to continue representing him in those circumstances, but he could
not, whether to safeguard his fee or for any other reason, use deception to induce his client to settle
against the client’s will. The decision to settle is the client’s alone.”6
Even if Dean had committed malpractice, however, it was harmless: “[Dean’s] negligence injured
McKnight only if, had it not been for that negligence, McKnight could have been expected to obtain
more than that amount in his suit against Gingras.” Indeed, Judge Posner (who had previously
observed that “[i]nsurance companies are not noted for their generosity,”7) opined that Dean’s
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Illinois Association of Defense Trial Counsel
P.O. Box 7288, Springfield, IL 62791
IDC Quarterly Vol. 12, No. 1 (12.1.19)
negotiation of a $765,000 settlement was “impressive given the weaknesses in the case against
Gingras”8, and even remarked that Dean “did McKnight a favor in ‘coercing’ a $765,000 settlement, if
that is what actually happened.”9
The court concluded that McKnight could not prove that he had been injured by the alleged
malpractice, and so his malpractice claim was doomed: “[I]f there is no injury, there is no tort.”10
Stopping up the Road to Remorse11
Obviously, McKnight v. Dean is noteworthy for its holding that a legal malpractice plaintiff who
alleges that his lawyer committed malpractice in recommending settlement has the burden of
establishing that he would have done better by rejecting the settlement offer and going to trial.
But McKnight also demonstrates that clients sometimes “forget” that you reviewed their options
with them before asking them to make critical decisions. McKnight reminds us that some clients will
bring claims even if things turn out well for them. Attorney Dean negotiated an impressive settlement
for his client McKnight – yet McKnight sued Dean anyway, claiming that his decision to settle wasn’t
fully informed. Of course, Dean ultimately prevailed, but he had to litigate the claim all the way to the
Seventh Circuit to do so.
If your file contains a writing outlining your client’s options and confirming your client’s decision,
you will be better able to ward off or cut short the lawsuit that may be filed by a client who regrets her
decision. It is not weasel-like to confirm important instructions. Doing so helps you fulfill your ethical
responsibility to carry out the client’s objectives, and to communicate important information to the
client.12 As a bonus, sometimes a confirming letter can even dissuade a client from a bad decision.
Sending confirming letters is especially important for defense lawyers who deal with corporate
entities or insurance companies. The corporate decision maker or claims handler who wanted to try
the case may be replaced tomorrow by someone who can’t figure out why you didn’t settle ages ago.
Alternatively, her decision may be questioned or criticized by a superior. Your letter confirming the
client’s decision does more than prove that you acted with client consent. It also helps other corporate
employees – subsequent claims handlers, new decision makers, second-guessing supervisors, and the
like – understand the defense strategy taken to date.
But you say, “My client doesn’t want to pay for extra letters. I send report letters only when I’m
asked, to keep costs down.” If a decision is important, consider whether providing the letter at no cost
to the client might be a sound investment in loss prevention. Be sure to include the drafting time as a
“no charge” item on the bill. Everyone – especially a cost-conscious client – likes getting something
for free.
Get Your Mojo Working
Here are some situations that should get your letter-writing mojo working.13
• Settlement decisions. Settlement demands and offers should be documented in writing. Obviously,
you can’t run back to your office and type up a letter in the middle of a settlement conference, but you
can write the offer or demand on a piece of paper and have the client sign it. At a minimum, write
your client a letter at the end of the day, confirming the day’s events.
• Other major decisions. Other important decisions in the litigation should be memorialized, too.
Say your client has decided, after much discussion, that you should not file a motion for summary
judgment. You are in agreement with that strategy, because the cost will be high, the prospect of
success low, and it will tip your hand about other aspects of the case. Confirm that decision in writing.
• Pigheaded decisions. As McKnight points out, clients have the right to make “pigheaded”
decisions – decisions against your advice and against their best interests. Assuming that withdrawal is
not an option,14 you must document your client’s decision to pursue a defense strategy that is contrary
to your advice.
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Illinois Association of Defense Trial Counsel
P.O. Box 7288, Springfield, IL 62791
IDC Quarterly Vol. 12, No. 1 (12.1.19)
Sending a letter confirming an unwise strategy ensures that you have not misunderstood the client.
It also may cause your client to reconsider his decision. Sometimes seeing it in black and white makes
it much clearer to the client. And of course, even if your letter does nothing else, it removes your
client’s ability to argue that he never would have followed such a stupid course of action, had you
only warned him against it.
• Decisions made by troublesome clients. Most lawyers have good instincts about which clients are
going to be trouble. The corporate client whose managers cannot agree on your strategy, the client
who is constantly second-guessing your decisions, the client who is obsessed with cost cutting – all
have the potential to be Clients from Hell. These are the clients who are particularly likely to sue you,
whether it is over your bill or the result in the case – even, as we’ve seen, if it’s a good result.
If you’ve smelled the brimstone, but can’t resist representing a devilish client, you will need to
carefully and continually document the client’s agreement with your strategy. Be sure you consider
the cost of this extra attention as you consider whether or not to take on a difficult client.
Conclusion
Documenting clients’ instructions is not just CYA. It is part of a lawyer’s professional
responsibility to provide information to clients sufficient for them to make informed decisions
regarding the representation. Written confirmation of clients’ options and decisions ensures that you
are acting with your clients’ consent, and ultimately helps you defend against legal malpractice claims
as well.
Endnotes
American Bar Association Standing Committee on Lawyers’ Professional Liability, Profile of Legal Malpractice
Claims, 1996-1999.
1
2
270 F.3d 513 (7th Cir 2001).
3
Talk about a case within a case!
The limit on Gingras’ $1 million professional liability policy had been reduced by the cost incurred by the insurance
company in defending Gingras up to that point – $235,000.
4
5
270 F.3d 513, at 519.
6
Id.
7
Id.
8
270 F.3d at 518.
9
270 F.3d at 519.
10
270 F.3d at 520.
“Make thick my blood/Stop up th’ access and passage to remorse/That no compunctious visitings of nature/Shake
my fell purpose.” William Shakespeare, Macbeth, act 1, sc. 5, l. 43-6.
11
12
Illinois Rules of Professional Conduct, Rules 1.2(a) and 1.4(b).
“I got my mojo working, but it just won’t work on you.” I Got My Mojo Working, McKinley Morganfield, a.k.a.
Muddy Waters. (According to Merriam-Webster’s Collegiate Dictionary, mojo is a noun meaning “a magic spell, hex,
or charm; broadly: magical power.”)
13
14
Illinois Rules of Professional Conduct, Rule 1.16.
ABOUT THE AUTHOR: Karen J. Dilibert is Vice President and Director of Loss Prevention for ISBA
Mutual. Before coming to ISBA Mutual, Ms. Dilibert spent several years in private practice, defending
professional liability actions as panel counsel for many major insurance carriers. She served as a Claim
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Illinois Association of Defense Trial Counsel
P.O. Box 7288, Springfield, IL 62791
IDC Quarterly Vol. 12, No. 1 (12.1.19)
Supervisor in the Midwest Division of DPIC Companies, Inc., where she directed the defense and
settlement of professional liability claims against lawyers, accountants, architects, and engineers.
Immediately prior to joining ISBA Mutual, Ms. Dilibert was an independent insurance agent specializing in
professional liability insurance for lawyers, accountants, architects, and engineers. She speaks and writes
regularly on loss prevention topics, and is an Adjunct Professor of Law at John Marshall Law School. Ms.
Dilibert received her B.A. from the University of Chicago (Phi Beta Kappa) and her law degree from the
University of Chicago Law School.
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