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1

Determining the Existence of a Cause of Action

Although formal litigation begins when a lawsuit (a complaint) is filed in court, a litigator's responsibilities begin much earlier. One of the first considerations facing an attorney is whether a potential client has a legitimate case. Before a party has a valid basis for a lawsuit, that party must have some injury or damage caused in such a way that the law recognizes the right to sue. In other words, a legal right to recover damages must exist. This legally recognized right to relief is known as a cause of action. Whether a cause of action exists is a legal question and must be made by an attorney. However, as a litigation paralegal, you might assist in researching this issue. Your research requires that you examine both the law and the facts of the case. In examining the law you should determine what factors or elements must be present before a cause of action is created

2

Once the elements of a cause of action are identified, the final step in determining whether a cause of action exists is to review the case itself to see if facts support each of the elements

Preparing a table or chart is helpful in this review. Identifying the elements of a cause of action is important in the litigation process for various reasons. Probably most important is that each of the elements must be proven at trial for the plaintiff to prevail. In other words, to win the case, the attorney must present evidence that supports each element of the cause of action. Also, in some state jurisdictions the initial pleading must allege facts that support each element of the cause of action. Knowing the elements of the cause of action in a particular case is essential to any litigation paralegal assisting the attorney in pretrial preparation. Understanding what the attorney must prove at trial enables you to gather appropriate evidence and conduct relevant discovery. It also equips you to prepare pleadings that comply with legal requirements and to review opposing pleadings for legal deficiencies

3

The ultimate information source for identifying elements of a cause of action

generally statutory or case law (or both). However, many secondary source books are of great help. Practice books and form books, which often contain explanations and legal analysis of the forms, are especially helpful. A popular resource is "Causes of Action 2d" published by Thomson Reuters.

4

Feasibility of the Lawsuit

Even though an attorney determines that a case has merit-that is, a cause of action exists-he may nevertheless decide that the lawsuit is not practical. Litigation takes a great deal of time and can cost a great deal of money, not only in attorney fees but also in costs. For example, it may be necessary to hire expert witnesses to establish certain facts. Experts charge substantial fees for their services. Numerous witnesses may need to be questioned and deposed. This also is costly. before accepting a case, attorneys usually review it to see if it is practical. This involves reviewing the damages suffered by the plaintiff so that the value of the case can be determined. If the injured party's injuries are slight and result in little out-of-pocket expenses, the case might cost more than is reasonable. Preliminary investigation might also involve some research into the defendant's ability to pay a judgment. As a litigation paralegal, you might be asked to assist in doing this

5

Turning Down A Case

If an attorney decides not to accept a case, she must clearly communicate this to the individual concerned. This should be done in writing so that there is a record of the fact. Many attorneys have been sued for malpractice by individuals who claim that the attorney led them to believe that their cases were being handled and learned only after the statute of limitations had expired that the attorney had not, in fact, accepted the case

6

Time Limitations

Different time limits exist for different kinds of cases. As a paralegal you must be aware of these time limits. Any time a new case is accepted by a law office, it must be carefully calendared and reviewed so that a lawsuit is filed in court within the proper time limits

7

Statute of Limitations

The basic time limit for filing a lawsuit in court is known as a statute of limitations. Unless a case is filed within the appropriate statute of limitations, it will be dismissed, regardless of the merits of the case. Statutes of limitations are found in state and federal codes and vary from one jurisdiction to another. Statute of limitations also differ depending on the type of case

8

Tolling the Statute of Limitations

Certain events sometimes toll, or extend, the statute of limitations. When a statute of limitations is tolled, the time stops running. A common reason for tolling a statute of limitations is that the plaintiff is a minor. In such cases, the statute is tolled during the minority of the plaintiff and begins to run once the minor reaches the age of majority. Thus, if a 10-year child is injured in an automobile accident and the statute of limitations is normally 2 years, that 2-year period does not begin to run until the child reaches the age of majority. The statute would expire on the child's 20th birthday (2 years after reaching the age of majority). Do not assume, however, that the statute of limitations is always tolled during a child's minority. You must check the appropriate statutory law. For an example of a statute that incorporates a tolling period, read 28 U.S.C. Section 2401(a). This statute is tolled during a person's legal disability or during any time the person is "beyond the seas."

9

Claim Statutes

Some types of cases are governed by special statutes known as claim statutes. This kind of statute requires that a written claim be presented to the defendant before a lawsuit is filed. The time for filing the lawsuit is usually determined by the date that the claim is denied. Claim statutes are common when a governmental entity is sued or when the defendant is deceased and a probate is pending. Naturally, there are time limits for presenting the claim, time limits that are often shorter than the statute of limitations for similar cases. Time limits for filing claims are often not tolled during minority or other legal disabilities.

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Basically, a written claim requires the following:

-notification to a prospective defendant of intent to sue
-identifying information about the person making the claim
-description of the nature of the claim
-the amount of the claim

11

Laches

In addition to the statute of limitations, equitable cases (cases in which the plaintiff is asking for something other than money damages) are governed by another time limitation known as laches. Laches is an equitable principle that prevents lawsuits from being filed

12

Tickler Systems

Missing a statute of limitations or a claim statute can result in a malpractice claim against the law firm. Therefore, all litigation firms have calendar or tracking systems to remind them of these and other important dates. These calendaring systems are known as tickler systems. Before the advent of computers in the law firm, reminders were kept by hand. A firm might have used a special calendar or a small file box organized by dates. Today, numerous software programs help firms keep track of important dates

13

Even though a firm uses a computer, certain precautions should always be followed:

First, when a case is tickled for the statute of limitations, it should be calendared early enough to allow for preparation of the complaint and for obtaining any necessary signatures. Second, the file should be re-calendared for a date near the statute of limitations, at which time it should be checked to verify that the complaint has in fact been filed. Third, if calendaring the case is not your responsibility as a litigation paralegal, you should still check cases assigned to you to make sure that proper calendaring has occurred. You might even wish to keep your own calendar, in addition to the firm's calendar, for cases assigned to you

14

Ethical Considerations in Accepting a Case

All attorneys are subject to a certain code of conduct. Ethical rules for attorneys are found in state law, although many states pattern their rules after the American Bar Association Model Rules of Professional Conduct. Ethical rules generally apply to attorneys rather than to paralegals, but you must still know and follow these rules. If a paralegal works under the direction or supervision of an attorney, and the paralegal violates any of the rules, the attorney is often held responsible and may face disciplinary action by the state bar. Ethical considerations control the entire litigation process, beginning with the decision to accept a case. Several ethical considerations influence the attorney's decision to accept or reject a case. Other ethical standards govern the attorney's and the paralegal's conduct during the course of litigation

15

Competency to Handle the Case

Obviously, an attorney should not accept a case if he does not possess the ability, knowledge, or time to handle it. This decision is up to the attorney, and the paralegal has little, if any, input into it. However, competency means more than simply having the ability to handle a case. It also means that attorneys are prohibited from neglecting cases that they have accepted. This can concern a paralegal. When you are assigned to work on a case, you should make sure that the case is not ignored. A tickling or calendaring system should be established to remind the attorney or paralegal to regularly review all cases

16

Frivolous Claims

Lawsuits that have no merit should not be pursued. Again, this is usually determined by the attorney, but the attorney may rely on your research in making this decision. If an attorney handles a frivolous case, he risks being sued himself by the defendant in the action, in addition to subjecting himself to disciplinary proceedings by the state bar association. Furthermore, pursuing any claim or defense that has no evidentiary support is also a violation of Rule 11 of the Federal Rules of Civil Procedure. Any attorney violating this rule is subject to sanctions or penalties imposed by the court

17

A law firm generally cannot accept a case if a "conflict of interest" exists. Conflicts of interest can arise in a number of different situations:

1. A conflict might exist where the opposing party in the new case was a prior client of the firm or of any attorney in the law firm
2. A conflict might exist if a paralegal worked on a prior case in which the prior client is now an opposing party
3. A conflict might exist if any of the attorneys or paralegals have personal relationships with attorneys or paralegals representing the opposing party

A conflict of interest usually arises when a firm is asked to sue a party whom it currently represents or previously represented in another case. Although prior representation does not always result in a conflict, the potential for a conflict exists and must be closely examined before accepting the case. A conflict is determined by whom the firm represents, rather than by whom any particular attorney in the firm represents

Most law firms, especially larger ones, now have centralized computerized lists of all clients. This makes the conflict check simple and more accurate

Not all conflicts of interest revolve around the clients or parties in a potential case. Some conflicts are created by relationships between attorneys or paralegals in opposing law firms.

Even if a conflict does exist, the firm can still handle the case if the prior client agrees in writing to waive the problem and if the conflict does not interfere with the ability of the attorney to represent the client. In the event that a conflict is not waived, the firm cannot accept employment in the new case.

18

Communication with the Client

Lawyers owe a duty to their clients to keep them advised about the status of their cases. Failure of lawyers to do this is the basis of one of the most common complaints against attorneys. Litigation can sometimes take years, and much of the litigation process does not personally involve the client. If a lawyer fails to communicate with his client on a regular basis, the client may think the attorney is doing nothing on the case. As a paralegal, you can be an asset to the attorney in maintaining communication with the client. In fact, parties often feel more comfortable dealing with the paralegal. In any event, if you have been assigned to a case, you should establish some procedure for regularly advising the client about the status of his action. This requires that you calendar cases for regular review. In addition, the most important rule to remember is to always return phone calls promptly. You should also keep a record of all telephone calls

19

Communication with the Opposing Party

Attorneys or paralegals violate ethical rules when they personally contact an opposing party who is represented by his own attorney. Contact must always be made with the attorney. If the opposing party is not represented by counsel, communication is allowed. If you are required to contact an opposing party, you should first verify that the opposing party is not represented. Naturally, an opposing party can be contacted to ascertain whether he is represented and who is representing him. However, once that information is disclosed, all further communication should cease.

One situation that sometimes occurs is that the opposing party, who is represented by an attorney, contacts you by telephone. (This is often a result of the failure of the opposing party's attorney to return telephone calls.) In such a situation you must tell the party that you cannot talk to him. You should also advise the party's attorney that her client attempted to talk to you about the case

20

Confidentiality

Communication between a client and an attorney is confidential. The attorney is prohibited from disclosing any information revealed to him by his client. Even mentioning the client's name, without discussing the facts of the case, may be a violation of this ethical requirement. As part of the litigation team, the paralegal is bound by the same rules. Whether you are present during conferences between the client and the attorney, whether the client directly communicates with you, or whether information is relayed to you by the attorney, you must honor the confidentiality. You should not discuss the case with anyone not directly involved in the case

21

Honesty

An attorney must never knowingly make a false representation about a case to a court or other tribunal. Although paralegals do not usually appear in court, you may frequently assist in the preparation of documents that are filed in court. You must be careful that factual and legal information is true and accurate.

In addition to honesty with the court, attorneys and paralegals should always be honest in their dealings with other attorneys and other paralegals. Aside from basic ethical considerations, a firm's reputation will be destroyed if its attorneys and paralegals cannot be trusted by other firms

22

Attorney Fees and Ethics

Attorney fees present several ethical concerns. Only the attorney is allowed to set fees. Professional guidelines prohibit a paralegal from being involved in establishing fees in a case. However, you should be aware of the fee structure in case a question arises about a billing entry during the course of litigation. The fee should not be unreasonable or unconscionable. The fee arrangement, including any additional expenses, should be clearly explained to the client and it should be in writing. Some state laws require a written retainer agreement. Another important ethical rule prohibits sharing of fees with nonattorneys.

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Flat fee

A fee in a litigation case can be set in a number of different ways. At the outset of the case, the attorney could simply set a flat fee, or fixed sum, to handle the case. For example, an attorney and client might agree that the attorney will handle the client's contract dispute for $10,000. Because the amount of time needed to properly litigate a case is hard to predict, it is rare to see a fee set in this manner. However, if the fee is set this way, the attorney must make a reasonable, good-faith effort to make the fee commensurate with the expected work in the case

24

Hourly billing

More commonly, the attorney and client will agree to an hourly billing. In an hourly billing, the client is charged a fixed amount for each hour the law firm spends on the case. The hourly rate cannot be excessive, but there are substantial differences in fees charged by lawyers, often depending on the attorney's experience. It is also common for firms to bill for paralegal time. For example, a firm handling some complicated business litigation might charge the client as follows: Senior Litigation Attorney-$350/hr; Junior Litigation Attorney-$225/hr; Paralegal-$125/hr. It is, of course, unethical to bill the client for time not spent on the case

25

Contingent fee

An alternative way of setting a fee in litigation is the contingent fee, a common arrangement in personal injury cases. In the contingent fee agreement, the attorney takes a percentage of whatever recovery is obtained. If no recovery is made, the attorney receives no fee. In this type of fee arrangement, there are times when an attorney receives a large fee for little time spent. Such a result, however, does not make the arrangement unreasonable. Contingent fees have been allowed on the theory that they permit people to pursue cases they could not afford otherwise

26

Costs

Courts require filing fees to process documents. Investigators and experts are often needed to help prove the case, and process servers have to be paid to serve papers. Out-of-pocket expenses such as these are known as costs. Most attorneys expect that the client will pay the costs of suit in addition to the fee that is charged. Even if the case is handled on a contingent fee basis, the attorney may request that the client put up funds to cover expected costs. Sometimes the attorney will advance or pay for these costs himself, expecting reimbursement (in addition to his fee) when the case is settled. It is important for the attorney to make this clear to the client

27

Standards regarding fee sharing

In addition to ethical standards regarding the amount of fee a lawyer may charge, there are also standards regarding fee sharing. Generally, an attorney cannot share a fee in a case with a nonlawyer. This includes a paralegal.

28

Fee arrangement in writing

The free arrangement between the client and the attorney should always be in writing and signed by the client. In some jurisdictions, this is now required by law. However, even if not required, common sense dictates that the agreement should be clearly set forth in writing to avoid any dispute. The fee arrangement is usually included in a document referred to as a retainer agreement (a legal fee imposed at the beginning of a legal action, usually intended to be applied to future attorney fees actually incurred)

29

Property of Client-Trust Accounts

An attorney cannot commingle his own assets or property with property belonging to a client. To handle this kind of a situation, attorneys have special bank accounts, known as trust accounts, into which they deposit all money belonging to their clients. It is allowable to have one trust account for many clients, as long as accurate records are kept.

In litigation, trust accounts are used for 2 main purposes-advances by the client and settlement or satisfaction of judgments. First, if the client gives the attorney money that is specifically designated for costs, then the money should be deposited in a trust account until the cost is actually incurred. The attorney should not deposit the funds into his general account. Likewise, if the client gives the attorney a fee advance, that should also be deposited into the trust account until the fee is actually earned. Second, when a case is settled, the attorney must exercise care regarding any money he receives. A settlement check is primarily the property of the client. However, the attorney wants to be certain that he receives his fee and costs. In fact, the attorney may have a lien against the settlement if so provided in the retainer agreement. Because of the client's interest in the check, however, the attorney cannot deposit it into his personal account. The attorney must deposit the check into the trust account. After he makes certain that the settlement check has cleared, he can make proper disbursements from the trust account, paying the client his share and reimbursing himself for his costs and fee. If the trust account contains money for more than one client, the attorney should always make sure that the check has cleared before making any disbursements. Failure to do so could result in the property of one client being used for the benefit of another. The importance of proper control and management of trust accounts cannot be overemphasized. Intentional misuse of clients' funds is theft and is punishable criminally. Negligent misuse of client funds results in disciplinary proceedings against the erring attorney. This is one area where bar associations are especially strict

30

Confidentiality and Client Communications

A recent U.S. Supreme Court case allowed a government employer (a police department) to search the text messages of one of its officers. However, in its opinion, the Court recognized that many legal questions remain unanswered. The Court said, "Prudence counsels caution before the facts in the instant case are used to establish far-reaching premises that define the existence, and extent, of privacy expectations enjoyed by employees when using employer-provided communication devices...At present, it is uncertain how workplace norms, and the law's treatment of them, will evolve." (City of Ontario v. Quon, 130 S.Ct. 2619, 2629-2630[2020]). Whatever privacy rights do or do not exist, an ethical attorney or paralegal must use caution and common sense in using technology to communicate with clients