This is a transcript of a podcast discussing the issues relating to the use of
technology in Engagement Letters and Retainer Agreements.
Speaker Key: PBPhil
PB: Hi, it’s Phil Brown. I’m here
with David Whelan, and today we’re going to talk about retainer agreements and
DW: One of the things you may want
to think about when you’re starting to set out your relationship with your
client is how you are going to explain to them the types of technology you use,
and how the technology that you use will impact their information and their
communications with you.
PB: The first thing a lawyer or a
paralegal should consider is, “Am I going to use an engagement letter or a retainer
letter?”, and the answer is, yes you should. It is the contract that you have
that sets out what is expected of you and the client, and how that whole
relationship is going to be treated.
DW: One of the debates that seems to
arise is, “Do I really need to tell my clients about the technology I’m using?”
You’re wondering, “Isn’t that the same as describing where I keep my money in
my bank account and other aspects of my practice? What do you think about that?”
PB: Those are all things that you
don’t necessarily want to share with your client. For example, how often do I
restock the photocopier, how often do I buy new technology, and how up to date
are my computers? Those are things that I don’t think you should necessarily share
with a client. It is more reasonable that your client is going to want to know
where their confidential information is going to be stored, how you are going
to communicate with them, if you will be sending them emails, if you use a
service like Gmail and the cloud, and if you have your own server-based email
with your own domain. I think those are all important information for a client
to have so that they can make a choice and/or possibly opt out of that means of
DW: It seems that if you are trying
to be clear about roles, obligations, and what the risks are, that you want to
include that. There are a couple of choices. One, you can leave it out, and I
wouldn’t recommend leaving out the discussion. But even if you decide to put it
in, you really have two choices: one is to say, “These are the technologies
that I use in my practice. I have developed my practice around using these
technologies and either you are willing to have me use these technologies, or
you won’t be able to have me as your lawyer.” The other way is to say, “I have all
these technologies, but I also have another way to do some of these things. If
you want to opt out of some of these elements, I can allow you to do so and we
can work out different ways for me to communicate with you rather than using
email, for example, or other ways to deal with your information.”
PB: It is the client’s confidential
information that you are storing. You are responsible for its confidentiality. One
of the things that they will want to know is where the information is going to
be stored. Is it in a bucket in your office? Is it in a safe? Is it
electronically kept somewhere else?
DW: It seems fair to say that the
client should be able to choose. They may be uncomfortable, for example, with having
their information moving from country to country or being stored on servers in
a particular country. And I don't know that there’s really any good or bad
country from that perspective, but there may be in particular cases, or
particular matters, that there are certain countries where you don’t want to
store your information. Letting the client know to the extent that you yourself
are able to know where the information is being stored – that would be helpful.
PB: And you bring up two points: (1)
do you know where that information is going to be stored? I know with some law
firms and lawyers and paralegals, the cloud service that they use may just be a
front for a hosting service somewhere else. They may not have the information
themselves; they may be renting space on servers in California or New York or
England or someplace else.
DW: If you use a service like
Dropbox for example, which seems to be one of the common ones that you find
lawyers using, there is a good chance that all of your information is actually
being stored in the United States. So you have to have that discussion, or at
least explain to your client. But that is a best case scenario, because you can
find that information directly from Dropbox. With Google, if you ask them where
their servers are, they won’t necessarily tell you where the servers are and
which ones you’re using. If that is going to be a concern with your client in a
particular matter, it is better to have that discussion up front than at the
end when the client is complaining.
PB: The second point is you might
have a client who has a particular sensitivity with the country that your
information is going to be stored in. For example, they may have assets in the
US, or maybe they are under investigation in the US, and they will not want you
to store their confidential information in that country’s servers.
DW: Another thing to think about is
how it is stored. What sort of encryption is applied to it? How is the
information taken care of? How would you share that information with a client?
PB: I would want the client to know
whether or not the information was encrypted by a third party. For example, if
I sent my information into a practice-management software system in the cloud, and
the information, although it’s encrypted both on the way to that third party
and on their site, there is no doubt that if they were subject to some sort of
search warrant, they would give up that information. The other thing the client
might want to know is if you are going to pre-encrypt that information before
you upload it into the cloud. That is fair to put in a retainer agreement.
DW: It will be tricky to include in an
engagement letter - not to get too technical into the details - which might also
change based on whether you change services in the middle of the matter. Those
sorts of details may change too.
PB: Right. So how the information is
stored might be one thing you want to tell them. Also, how you’re going to
access that information later. For example, if the file is closed will they
still be able to access that information if it is stored someplace? Are there
any costs associated with recovering that information? Those are important
points to put in a retainer agreement as well.
DW: Yes, and some of this you may
not know, or it may change over time. But if you have an opportunity, and if
you’ve really done your work as you’re setting up the technologies that you’re
using in your practice, you probably have a sense of what these costs or what
the considerations would be that you can incorporate. While you may not be able
to give your client every detail, you can give them a sense of the scope of how
you are using technology.
PB: Right. And the retainer
agreement does not necessarily have to be boilerplate. Depending on the client
that you have, you can be flexible and change certain parts of it as you go,
depending on the client’s needs.
DW: That’s a great point.
PB: The key to this whole thing is
client communication; it’s engagement; it’s their understanding of what the
relationship they have with a lawyer or paralegal is.
DW: There is a spectrum; some may be
reluctant, either because of the matter or because of their own technological skills,
to use the technology or to agree to use it in the way that you want to. But you
will also find clients at the other end who will really appreciate the
technology that you’re using, the productivity gains that you’re getting out of
it, and the ability for you to share with them using things like file sharing
online or other tools that are built in to case management products so that
they can stay up to date on the information that’s going on in their matter,
without having to contact you.
PB: It is a good idea to tell the
client that you are using this technology, and it is going to reduce your
costs. You will be more efficient. You are using technology, one of the
requirements lawyers and paralegals have. It is also a good idea to tell them
what your destruction policy is.
DW: Yes. You should spell out how
you’re going to do that. If you have all of this electronic data stashed out
there, what are you going to do with it when the matter is over and how are you
going to store it? Are you going to pull it down off of cloud servers if that is
where you have it stored? Or if you have it in your office, are you going to
delete it off of hard drives?
PB: That’s our look at engagement
letters and retainer agreements. Thanks David.
DW: Thanks Phil.