Practice Pointer: “No evidence that the Parties Executed a Retainer Agreement…” = BAD.

The Minnesota/Texas law firm of Droel pllc had its lawsuit against a client thrown out of Minnesota court for lack of jurisdiction even though the law firm had exchanged “hundreds” of communications between themselves and Turnkey, their Texas client.

Regular readers of Minnesota Litigator know we have a preoccupation with the doctrine of personal jurisdiction under U.S. law.

Specifically, the analysis focuses on whether someone “has reasonable expectation of being haled into court” and whether someone “purposefully avails himself of of the privilege of conducting activities in a particular state.” This reasoning has some obvious problems and needs some fixing. (The first factor is circular logic. The second is extremely ambiguous.)

But it is what it is. For now at least, it is the law of the land.

What is important about the recent unpublished Minnesota Court of Appeals decision in Droel v. Turnkey for Minnesota litigators is the cautionary tale in Droel’s failure to open the matter with an engagement letter (aka a retainer agreement).

Photo by Jonathan Rotondo-McCord

LEVENTHAL pllc is a law firm dedicated to Minnesota civil litigation, with a particular focus on plaintiff’s side legal malpractice.

One of the simplest pieces of advice that we can give lawyers to mitigate against the risk of professional malpractice is HAVE AN ENGAGEMENT LETTER (or retainer agreement, if you prefer).

Basic elements of engagement letters include: (1) identification of who, exactly, the client is, and (2) what, exactly, the legal task to be performed is. How useful these two simple communications are cannot be overemphasized.

It is also common for engagement letters to include some disclosure of how disputes will be resolved (that is, the client might acknowledge and agree that disputes should be resolved in the law firm’s home state), which would have avoided the landmine that Droel stumbled on.