1.1. Who should read this Guidance Statement?
This Guidance Statement is for solicitors and law practices.
1.2. What is the issue?
In an increasing range of matters that have traditionally been handled by a solicitor from start to finish, solicitors are sometimes asked to assist clients with discrete tasks only under partial or limited retainers. This trend has been called ‘limited scope representation’ (‘LSR’), as well as ‘discrete task assistance’ or ‘unbundling’ and, while it presents new opportunities to serve clients who may not otherwise be able to afford any representation, LSR also presents challenges.
This Guidance Statement is concerned specifically with LSR in the dispute resolution context.
LSR work is an emerging form of practice to address growing client needs. It is an important way to enhance access to legal services for the many people who are not eligible for free legal services, but cannot afford the costs of a traditional full service retainer. The Productivity Commission has recognised LSR works as a potential solution to growing ‘access to justice’ concerns.
For commercial solicitors, the concept is not new, as they more commonly provide discrete legal services, such as reviewing contracts or providing tax advice. LSR can now be seen in areas such as family law and in the community and pro bono legal sectors, but is also emerging in property law and succession.
For solicitors acting in dispute resolution (with which this Guidance Statement is concerned), LSR may mean providing advice on drafting or checking documents only, providing discrete advice about a particular step, representation at mediation or making limited court appearances.
Ultimately, in LSR work the case remains mainly client-led rather than the traditional process involving a solicitor guiding the entire process. The purpose of this Guidance Statement is to outline some of the ethical principles and issues which solicitors should consider when acting on an LSR retainer.
1.4. Status of this Guidance Statement
This Guidance Statement is issued by the Queensland Law Society (QLS) Ethics Centre for the use and benefit of solicitors.
This Guidance Statement does not have any legislative or statutory effect. By having regard to the content of the statement and following the guidance, it may be easier for you to account for your actions if a complaint is later made to the Legal Services Commission.
This Guidance Statement is not legal advice, nor will it necessarily provide a defence to complaints of unsatisfactory professional conduct or professional misconduct.
This Guidance Statement is endorsed by the QLS Ethics Committee as representing a standard of good practice.
2. Ethical principles
While there are no specific Rules in the Australian Solicitors Conduct Rules 2012 (‘ASCR’) relating to LSR, either generally or with respect to dispute resolution, of particular relevance are the following (emphasis added).
Rules 3.1, 4.1.1, 4.1.3, 7, 8.1 and 13.1 provide:
3. Paramount duty to the court and the administration of justice
3.1 A solicitor’s duty to the court and the administration of justice is paramount and prevails to the extent of inconsistency with any other duty.
4. Other fundamental duties
4.1. A solicitor must also:
4.1.1. act in the best interest of a client in any matter in which the solicitor represents the client; …
4.1.3. deliver legal services competently, diligently and as promptly as reasonably possible;
7. Communication of advice
7.1. A solicitor must provide clear and timely advice to assist a client to understand relevant legal issues and to make informed choices about action to be taken during the course of a matter, consistent with the terms of the engagement.
7.2. A solicitor must inform the client or the instructing solicitor about the alternatives to fully contested adjudication of the case which are reasonably available to the client, unless the solicitor believes on reasonable grounds that the client already has such an understanding of those alternatives as to permit the client to make decisions about the client’s best interests in relation to the litigation.
8. Client instructions
8.1. A solicitor must follow a client’s lawful, proper and competent instructions.
13. Completion or termination of engagement
13.1. A solicitor with designated responsibility for a client’s matter must ensure completion of the legal services for that matter UNLESS:
13.1.1. the client has otherwise agreed;
13.1.2. the law practice is discharged from the engagement by the client;
13.1.3. the law practice terminates the engagement for just cause and on reasonable notice; or
13.1.4. the engagement comes to an end by operation of law.
Challenges that a solicitor may face when engaging in LSR include:
- assessing whether a case is suitable for LSR;
- managing and communicating the scope of the retainer with the client so that there is clarity about the service the lawyer is providing, including how it is reflected in any written costs agreement;
- dealing with third parties, including solicitors acting on the other side, so as not to misrepresent the scope of the retainer and to ensure that the ‘no-contact rule’ (ASCR, Rules 22.4 & 33) is being complied with. There is also a risk of miscommunication, where the client is dealing with the other side directly;
- making difficult judgements about how far to go in exploring facts and issues that are related to the work that is within the scope of the retainer, particularly if the solicitor is coming in after the matter has been going for some time.
Scope of an LSR retainer
Solicitors have a duty of care to apply the relevant degree of skill and exercise reasonable care in carrying out the task. While the agreed scope of the retainer is an important factor in determining this duty of care, there remains the risk that a broader scope may be found to exist for the purposes of determining professional negligence, once considerations such as the nature of the task and circumstances of the case are taken into account.
In Trust Co of Australia v Perpetual Trustees WA Ltd and Others 1 McClelland CJ observed:
“The duty of care owed by a solicitor to his client is to exercise reasonable skill and care. What is required for the performance of this duty in a particular case depends on the scope of the solicitor’s retainer, the scope of any additional responsibility assumed by the solicitor and relied on by the client, the nature of the task entrusted to or undertaken by the solicitor, and the circumstances of the case.”
The Queensland Supreme Court has also recently demonstrated a willingness to extend the scope of the retainer beyond that argued by the solicitor.2
In the UK, a court has looked specifically at the issue of professional negligence in the context of LSR work.3 In that case, the Court of Appeal upheld a decision that a solicitor on a retainer to redraft financial orders in a family law matter had no duty to advise on the underlying financial agreement. The court noted the increasing prevalence of limited scope retainers in family law work and its importance to litigants and the court and that good practice is to limit the scope of the retainer in writing.
To help solicitors to overcome the challenges presented by LSR in the dispute resolution setting, and to ensure that the client obtains the greatest benefit of this approach, it is suggested that the following approach be followed:
1. Is the matter suitable for LSR? The limited scope of the proposed representation must be reasonable in the circumstances. Factors include whether the limited role will enable the solicitor to provide proper, diligent and competent representation. Solicitors should therefore have a process in place to assess whether a matter is suitable for LSR, including assessing the:
a. Characteristics of the case. As a general rule, the more complex and contested the case, the more cautious the solicitor should be about providing LSR. This may relate to:
- The facts of the case. The solicitor must be able to achieve sufficient mastery of the facts and evidence to provide competent assistance on a limited scope basis. This may include verifying facts and evidence critical to the success of the matter.
- The law. Where the law is complex, its application in this case may be difficult to assess, making the solicitor’s job more difficult on a limited scope basis.
- The process. Processes designed for self-represented litigants, or in which self-represented litigants are common, are generally more appropriate for limited scope assistance. As the process becomes more complex, the level of knowledge and skill required to succeed in the process increases.
- The level of conflict in the dispute. Cases where there is a history of entrenched conflict between the parties pose obvious challenges for limited scope assistance.
- The stakes. Cases where the personal consequences to an individual are greater (i.e. potential significant monetary losses or risks to an individual’s liberty or reputation) require more careful consideration as to the appropriateness of a limited scope retainer.
b. Characteristics of the client. The client must appear to the solicitor to have the skills and ability to understand and carry out those tasks for which they are responsible in the conduct of the case. Some clients may lack the skills to conduct their part of the case, or their ability may be impacted by other factors such as acute emotional distress, health or logistical problems. Assisting a client to get into a dispute resolution process when they cannot manage the obligations imposed on them by that process may not be in the client’s best interests. This is particularly so when the client is at risk of costs orders against them if they fail.
c. Characteristics of the solicitor. The knowledge and experience of the solicitor in the type of case is a relevant consideration. An experienced practitioner finds it easier to make sound judgements about the extent of instructions required from the client, and is more able to anticipate, recognise and manage problems as they arise.
d. Capacity of the solicitor and client to work together to achieve the desired outcome. Some litigants choose to self-represent because they have rejected the advice of their previous lawyers and want to conduct the case their way. Limited scope assistance is not appropriate unless the solicitor and the client are aligned about the best way to conduct the case, and each willing to play their part in doing so.
2. Review suitability continually. Solicitors should constantly review whether a matter remains suitable for LSR. For example, where there are inadequate or poor quality instructions provided by the client, further clarification from the client should be sought before continuing any assistance.
3. Have a written costs agreement. It is important to have a written retainer, even where a costs agreement would not otherwise be required having regard to the fees the solicitor proposes to charge. This retainer should:
- Identify the work that is within the scope of the retainer, that which is outside the scope and the client risks arising from the limited scope.
This is particularly important where the LSR work involves a departure from the more common or traditional manner in which the relevant services are provided. It may require expressly informing the client that this arrangement differs from the traditional way in which the work is done, the nature of the limitations and the risks of providing legal services in this manner, and how these risks may affect the client.
Ideally, provide a list of things that will be included under the retainer and the things that the solicitor would ordinarily do but which are outside the scope of the retainer and identify the risks to the client’s objectives in excluding that work. The client may also be provided with a list of the risks inherent in the work (for example a risk of a costs order).
- Establish when the retainer will be complete, and the grounds on which it can be terminated prior to completion of the work, for example failure by the client to provide adequate instructions or a divergence in opinion.
4. Clarify roles and responsibilities. In addition to defining the scope of the retainer in writing in a costs agreement, the solicitor should satisfy themselves that the client understands the limited nature of the retainer, and the roles and responsibilities of the solicitor and the client in the conduct of the matter.
The solicitor should keep adequate diary notes of conversations with the client about the limited scope retainer. In some matters, this may require a face-to-face meeting with the client. Evidence of the client’s acceptance of the limited scope retainer and the risks inherent in that arrangement, or an important step in the matter, for example an acknowledgement signed by the client, will assist the solicitor to demonstrate that the client understood and accepted the limited scope retainer.
5. Manage the scope. During the course of the matter, the solicitor should continue to manage the scope of the retainer. For this purpose, it may be useful to define stages of the work, and confirm in writing when each stage is complete. Aligning the fee and payment structure with this staging of work provides a useful mechanism to ensure the solicitor and client recognise when work agreed to under the retainer is complete.
If work outside the scope of the original retainer is to be done, this should be expressly communicated to the client in writing. Alternatively, consider referring the client to another lawyer where advice is needed on matters which are outside the agreed scope. For example, advice on the litigation itself, where the LSR is limited to settlement advice.
6. Confirm when the retainer is at an end. When the retainer is complete, it is good practice to confirm this in writing to the client as soon as possible. When concluding the retainer, particularly where the client is continuing to represent themselves in a legal process, the solicitor should outline for the client in plain language the next steps that they should take, the potential risks and applicable deadlines and time limits, but confirm that the retainer is now at an end. This will be particularly important in the case of individuals or others who are not ‘sophisticated’4 clients. However, the solicitor is not obliged to provide detailed instructions for how the client might conduct the matter themselves and without further legal representation. The written communication to the client should be explicit that the solicitor is taking no further steps in the matter, that the client is now responsible for taking all steps to protect their own legal rights and interests and that the client is responsible for meeting all time limits. For practices insured with Lexon, the Lexon Practice Pack contains a precedent letter that might be used.
7. Dealing with third parties. Where the matter involves dealings with third parties, such as other parties, solicitors or the court, and it is otherwise necessary and proper, those parties should be informed of the limited nature of the representation. Consent may need to be obtained from the client before doing so.
Where a solicitor is aware that an opposing party has representation for part of a matter, consent should be obtained from the solicitor who has provided the representation before communicating with that party directly.5 However, this rule only applies as far as the communication relates to the matter or issue for which legal representation exists. If this is unclear, a cautious approach should be adopted.
8. Remember what has not changed. The usual requirements of good legal practice apply equally to LSR work, in particular:
- The same fiduciary duties are owed to the client. Obligations of confidentiality and the duty to avoid conflicts of interest are no less applicable in this type of work. If working in this way results in a larger number of clients, this may increase the potential for conflicts of interest, so it is important that a firm has in place a robust conflict of interest policy and reliable procedures to support that policy.
- Good file management practices, for example keeping complete files and having a bring-up system to manage deadlines and limitation periods, are equally important in this type of practice. Usual checks such as identification, authority, capacity and undue influence at the outset of the matter are also essential, despite the limited scope of the retainer.
- This guideline is not intended to be prescriptive as each case will be different in the level of diligence required. In 2014, the Law Council of Australia made a submission to the Productivity Commission in which it supported the practice of limited scope works subject to the client giving informed consent and the limitation being reasonable. In the meantime, so long as solicitors have a good understanding of the risks and necessary safeguards, they should not be deterred from this growing area of work.
5. More Information
Solicitors are referred to The Australian Solicitors Conduct Rules 2012 in Practice: A Commentary for Australian Legal Practitioners, Queensland Law Society, June 2014.
For further assistance please contact an Ethics Solicitor in the QLS Ethics Centre on 07-3842 5843 or firstname.lastname@example.org
1 (1997) 42 NSWLR 237 .
2 See Robert Bax and Associates v Cavenham Pty Ltd  1 Qd R 476 . In that case, the solicitor argued that he was only engaged to prepare and stamp mortgage documents. The court held that a letter written by the client’s bank manager to the solicitor was evidence of a more extensive retainer, and that the scope of the retainer extended to providing advice as to the most effective method to protect the client’s interest in the financing transaction. The court also found that the solicitor could not undertake the retainer “without ascertaining the extent of the risk the client wished to assume in the transactions, evaluating the extent of the risks involved in the transactions and advising in that regard”. Further, the court found that the duty to advise “does not depend on advice or information being specifically sought by the client”. Consequently, even in the context of a limited and specific retainer, it is possible that a solicitor’s professional liability is triggered by reason of a general duty to advise their client.
3 Minkin v Landsberg (practising as Barnet Family Law)  EWCA Civ 1152, .
4 Legal Profession Act 2007 (Qld), Sch 2.
5 Australian Solicitors Conduct Rules 2012, rules 22.4, 33.