Hiring an Attorney – Some Thoughts

By: Eric C. Camp

Here are some things individuals and companies (collectively called “Clients”) should consider when hiring an attorney.

1) Conflicts of Interest

A preliminary issue is whether the professional responsibility rules regarding conflicts of interest prohibit the attorney from representing the prospective Client. These rules generally prevent attorneys from representing Clients in matters that directly (and sometimes indirectly) conflict with current and former Clients’ interests. Most attorneys do a “conflicts check” within their firms prior to beginning any new representation to comply with these rules.

If the attorney is “conflicted out”, the prospective Client can still ask the attorney for a reference.

2) Competence

Another issue is whether attorney is competent enough in the relevant legal subject to adequately represent the Client. The first substantive rule in the American Bar Association’s Model Rules of Professional Conduct is entitled “Competence” and reads “A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation.”

Lawyers are like doctors in this respect – there is just too much law to be an expert in every area. While lawyers may be very good at many areas of the law, Clients should always ask their prospective attorneys about their experience and expertise. Simply put, just because an attorney did a great job preparing a Client’s Will or handling a Client’s personal injury case, does not mean the attorney is competent to handle the Client’s oil and gas issues and vice versa.

3) Compensation

Attorneys and clients tailor many different compensation structures to suit their needs. The four most common arrangements are hourly, contingency, hybrid, and fixed fee.

Under hourly arrangements, the most traditional compensation structure, the Client pays the attorney a certain amount per hour the attorney works on the matter. Depending on the situation, the attorney may require a retainer to ensure payment. This arrangement works well for Clients with the resources to pay attorneys’ bills each month and can be cheaper in the long run than a contingency fee arrangement. This is also a more stable option for attorneys because, while there may not be a huge payday like in a contingency case, they get paid no matter the outcome.

Another common compensation structure is the contingency fee. Here the attorney is paid a percentage of the proceeds received by a Client. The attorney’s share can be as high as 40% or more. But, if the Client doesn’t receive anything from the representation, the attorney gets nothing. This option is attractive to Clients who can’t afford to pay an attorney’s hourly fee. From the attorney’s standpoint, this is much riskier than hourly billing because of the possibility of getting nothing.

A third structure is the hybrid. As the name suggests, it is a mix of the traditional hourly and contingency compensation arrangements. Usually this entails a lower hourly fee and a lower contingency fee percentage. For Clients, this can be beneficial if they have some money to pay the attorney’s bills but not enough for full price. For attorneys, this lessens the risk associated with regular contingency cases.

A fourth structure is the flat fee. Clients pay a flat fee for a specific service. Clients like this because they know exactly what will be charged and can budget accordingly. Attorneys use this to simplify billing. Under these agreements, both parties should carefully define what services are included and excluded in the flat fee to avoid later confusion.

Picking the right compensation structure is important to both the Client and attorney. Both parties should come to an understanding prior to beginning the representation.

4. Communication

Communication is key to a successful attorney / client relationship. The client needs to know the attorney (1) has the client's best interests at heart, (2) will give the client honest assessments about the strength (and weaknesses) of the client's position, and (3) will quickly respond to client status inquiries. These issues are all addressed in the Rules of Professional Conduct but are not always performed as well as they could be in practice.

The attorney also needs to feel comfortable that the client is completely disclosing relevant information and will also respond to communication requests.

Bottom line, if either party is not completely honest with the other, the representation won't work for anyone - except maybe the opposing side!

Another part of "communication" involves compatibility. People have different personalities and some people rub others the wrong way. If this is the case, the parties probably shouldn't begin or continue the professional relationship. Doing otherwise may indirectly and even inadvertently hurt the client's position.

Conclusion

The issues identified above are general things a Client should think about and address with its prospective attorneys to help ensure the Client gets a qualified and competent attorney to whom it can effectively communicate and afford. Having these conversations on the front end of a representation can save both parties from future headaches.



Eric C. Camp is an attorney in the law firm of Decker, Jones, McMackin, McClane, Hall & Bates, PC in Fort Worth, Texas. He is licensed in Texas and North Dakota and practices exclusively oil and gas law. Contact him at 817-336-2400 or ecamp@deckerjones.com.

Disclaimers

This article is not intended as legal advice and should not be relied upon as such. If you need legal advice, seek independent legal counsel.

These comments are the author’s own and not the official or unofficial position of any bar association. The author is an attorney licensed in Texas and North Dakota, not Louisiana.

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Comment by J B Nabors on April 9, 2009 at 2:54pm
Hiring an Attorney: Based on recent experience, I recommend that nobody sign any oil lease without competent representation. However... If you truly don't want to pay a lawyer, and are willing to do a little of your own homework, try this: identify the savviest mineral owners / players you know in this arena. Make a list. Then go to your local courthouse and look at leases these mineral owners have signed. Be sure to closely check the addenda and appendices pages and get copies made. These are the kinds of clauses you want to consider in your own leases.
Comment by Eric Camp on April 6, 2009 at 10:20pm
Parker,

I completely agree with you about communication and I edited the blog to reflect your wise advice.

Thanks!

- Eric Camp
Comment by Bobi Carr ("parker") on April 6, 2009 at 8:44pm
I got a memorandum of lease way back when I signed @ $200 per acre. Those extras have kept me a happy camper.

But you are right, DO YOUR HOMEWORK. You should be a team with your attorney IMHO.
Comment by Two Dogs, Pirate on April 6, 2009 at 8:41pm
Well what you want is what the lawyer got when he signed his lease in the same hood. Do your homework, go look up what they signed for, if is a memo of lease and your full lease is recorded then he/she got something better than you did.
Comment by Bobi Carr ("parker") on April 6, 2009 at 8:34pm
I don't mean it just on that level, but if you can't communicate to them in a way that they understand what you want, they can't help you.
One problem I can see is that some people want to go to an attorney for the attorney to tell them what they want.
If you don't know what you want no one can help you get it. They can only tell you what someone else wanted and whether they got it or not.
Comment by Two Dogs, Pirate on April 6, 2009 at 8:27pm
I am with you Parker, so many lawyers have a complex or air that seems to put them, in their own mind, above you. I would send one of these sorts down the right-of-way kicking a can.
Comment by Bobi Carr ("parker") on April 6, 2009 at 8:19pm
I would add that one of the MOST important things to consider is do you feel like you and an attorney communicate well. If not none of the other things matter.

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